The Pickering Post
Friday, 15th December 2017

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A FLAT RATE OF TAX IS THE ANSWER

... but who’s game to ask the question?

Larry Pickering

Four-time Walkley Award winning political commentator and Churchill Fellow, has returned to the fray over concern that the integrity of news dissemination is continually being threatened by a partisan media.

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Australia has one of the highest and most convoluted tax regimes in the world and each time politicians attempt to reform it, it becomes even more abstruse and outrageously costly to administer. In the late 60s, Doug Anthony, a one-time leader of the Country Party (now the Nats) came up with a solution: A flat rate of tax at 25c in the dollar.

What a great idea (one would have thought). Whatever anyone earns, be they individuals or companies, they simply pay 25% of profits or pay packets to the Government. No arguments, no deductions, no GST, no mining taxes, no wealth taxes, no employment-inhibiting payroll tax, no lawyers, fewer accountants and no need for tax havens or an amorphous ATO.

In fact the Federal and State Public Service could be halved... but the ensuing massive growth in the private sector would ensure productive employment for all, even Public Servants could learn to be productive. Current myriad forms of tax are mostly lost in administrative costs.

Total Government taxation revenue in 2012–13, as a proportion of GDP, was 27%, with the Commonwealth receiving 22%, State Governments 4% and Local Government 1%.

Per capita taxation in the same period was $18,108, an increase of 5% from the previous year and certain to soar further with bracket creep.

Right now there is no incentive for a productive employee to work longer hours because it pushes him/her into a higher tax bracket.

A flat rate of tax will lure a workforce to greater productivity while rendering the non-productive administrative sector redundant.

In the same 2012-13 period ABS figures cite total taxation revenue collected in Australia had increased 6% to $25,227m, taxes on income increased 5% to $10,886m while taxes on property increased 7% to $2,419m and taxes on provision of goods and services increased 3% to $2,877m.

In the same year, taxes on income represented 58% of total taxation revenue for all levels of government and taxes on goods and services, including the GST, represented 23% with some taxes usurped by 60% in administration costs.

With debt and deficits reaching chronic levels, a 25% flat rate of tax appears a no brainer, not for what it would raise but for what it would save.

A semi-trailer could deliver the Tax ACT to the nearest tip and Governments would be flush with funds for their pet social experiments.

With one third of the total Federal budget spend going to welfare ($150 billion) and almost a million malingerers claiming some sort of disability at the expense of the genuinely disabled, ballooning baby boomer pensioners living to 110 via an unsustainable Medicare system and recalcitrant Senates that refuse to allow a government to govern, something has to give.

Our taxation regime will never be reformed by simply fiddling at the edges with more white papers. It needs a complete overhaul and a rethink.

Of course it’s a waste of time even suggesting a flat rate of tax... governments thrive on circuitous wastage and bloated PS departments to administer their excesses.

A flat rate of tax breeds confidence, attracts foreign investment and allows both the taxpaying employee and the multinational to plan for the future in a vibrant predicable economy.

Bill Shorton’s Left is determined to bash the top end of town only, but the top end will simply move elsewhere (quite legally) leaving a gaping unemployment hole adding to the welfare bill.

There are too few workers and too many loafers taking advantage of 55 separate forms of social welfare that cannot be sustained on an entrenched and broken tax system.

Don’t know why I even bothered writing this piece because governments will always remain addicted to convoluted systems of raising revenue supported by an unintelligibly chaotic Tax Act and a devious ATO.

Oh well, sorry to have wasted your time.



Comments

I have been saying this for years. But we wouldn't even have to pay 25c in the dollar, we could pay about 15c. Australia would be the wealthiest country in the world and have full employment - well those that want to work anyway.

The whole tax system should be replaced. It is well past it’s ‘use by’ date, is far too complex and is not fair. It does not and can not generate sufficient funding in order to meet government spending. It does not meet the needs of the 21st Century digital economy. It’s capture base is continually diminishing. It can be & is ‘managed’ and manipulated by those with the resources to do so. It is subject to political & self interest group influence. Should I go on ???

Why should we waste money & resources trying to fix something that is obviously un-fixable and in any case is not ‘fit for purpose’ ? Tax review after tax review has proven this.

What do we replace it with ? Simple… A tax system that is not encumbered by the above. A system that does not rely on income tax, company tax, GST and the like, as does the current system.

A tax system that is based on the broadest tax base possible and aligns perfectly with 21st Century ‘e’ everything, The capture point is Financial Institute monetary transactions. Everyone and every entity is connected to a bank account somehow. No-one or nothing escapes, unlike current tax base capture points. It is EFT based and therefore provides a 24/7 revenue stream and the technology for implementation is already with us.

Australia’s Financial Transaction system is huge. A suggested 1%,,, yes 1% impost on every transaction has been modelled to provide approx. 3 times current tax revenues. It replaces all current taxation regimes. It’s benefits are too many to list on this forum.

So why hasn’t it been considered before this ? You would have to ask current and past governments, Treasury tax strategists, economists, taxation academics, other tax policists and external governmental influences for an answer to that.

It is nothing new and has been put to previous tax reviews with no consideration. A similar system has been used successfully overseas in recent years.

We have been asked by Treasurer to Re:think Australia’s current and future taxation dilemma. We simply cannot keep doing the same thing over & over again and expect a different outcome. We HAVE to do something DIFFERENT in order to have a chance of a better outcome.

I am going to suggest that Re:thinking the current system is pointless as we already know that it is well beyond repair.

Just THINK about the possibilities of using the currently un-tapped Financial Institute transaction system as the capture point for FUTURE taxation revenue.

Like

The Tiny Dot - by Larken Rose
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https://www.youtube.com/watch?v=a7uPPkZqPCQ

Dictatorship by Taxation

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http://www.colorado.edu/econ/courses/roper/sustainable-economics/debt/archives/msg00545.html

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http://www.restoreaustralia.org.au/history-of-the-commonwealth-bank/

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The Nation's Credit: Senator Richard Darcey, 1941 ( ALP ...

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http://www.alor.org/.../the-nation-s-credit-senator-richard-darcey-1941-alp-tas...

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Aug 27, 2012 - ALOR Blog ... In 1937, he was elected to the Australian Senate as a Labor Senator for Tasmania. He held ..... The Royal Commission on Banking and Monetary Systems, in paragraph 630 of its report, stated that Parliament is ...

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On the 12 November 1941 : page 258-264

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Senator DARCEY.- The banks can create as many millions of pounds as are required. It must be remembered that 21/2 (two and a half) per cent on a certain sum is equal to 5 per cent. on half of that amount. In December, 1937, Australia's national debt amounted to £1,262,911,649 0s. 1d. One person in the community, who signed himself "Patriot", was concerned about the magnitude of the debt, and accordingly he sent a 1d. stamp to the then Treasurer with the object, as he said, of reducing the debt to a round figure. Ufortunately, his purpose was not achieved, because between the time that he saw in the newspaper the amount of the national debt and the time when he sent the 1d. stamp to the then Treasurer, the national debt had increased at the rate of £1 13s. 4d. a second. The debt grows so quickly that it now amounts to £1,000,000 a week. It is still growing. Compound interest on that debt has got Australia into a deplorable state. Some persons in the community are forced to work five months in the year in order to pay their taxes. That is the position already when taxes have really only started.

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Senator MCBRIDE- I should have thought that the honorable senator would have convinced a Labour government that taxation is not necessary.

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Senator DARCEY.- At the moment, I am trying to convince the Opposition. I have stated facts in this chamber for several years, but previous governments have not heeded them.

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Senator COOPER.- Even if the honorable senator were to convince the Opposition now, he would be too late.

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Senator DARCEY.- Things are becoming so bad that the Opposition will be forced to listen to what I have to say. This country cannot pile up huge war debts and hope to meet its liabilities by means of taxes. I am obliged to tell the Opposition these facts because it is fighting against a budget which I am defending. There is only one way to avoid inflation.

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Senator ARTHUR- What is inflation?

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Senator DARCEY.- Inflation is the lowering of the purchasing power of the wages of the people. In South Africa efforts have been made to prevent inflation. Prices of commodities have been fixed, and heavy fines may be imposed on those who sell above such fixed prices. A man may be fined as much as £500, or given two years' imprisonment, for departing from the fixed price. In. Australia persons convicted of exceeding fixed prices were fined a mere £3 or £4............."

Larry , you have wasted no one's time . And certainly brought to the surface a hell of a lot that most never even dreamt about. But trying to move the masses is too big a job for just a few . They don't, and cannot be bothered listening or doing anything about it . Leaving the scurrulous dogs that want to wreck everything , free to play at whatever they like .The masses will only move when their lives are interrupted to the stage they can no longer enjoy each day. And then most will just continue hoping they won't get killed or something like that .You only have to look at countries like Russia , Cuba, and others of similar ilk , to see that the people would rather suffer , than fight. Seems that's the way of the human race .

Public servants have a very powerful influence over government ministers. No public servant in the Treasury Department will allow a flat tax. Their empires must be protected at all costs. Self interest will ensure the taxation system will get more and more complicated requiring bigger departments and an army of pen pushers.

W F M !! I have been pumping this since 1996 . John Howard at Burwood and Brisbane said NO ! Won't work and the wheel isn't broken !!?? Plus many medias n same mindless answers!! Bullshit ! The very simple move would SAVE AUSTRALIA from where the mad ffff....rr...s are pushing us!! LEADERS!!?? My ass !! No vision and NO guts!!

Scary stuff. Pollies only legislate popular laws in the hope of returning to 'Govern" at the next election. This is the first time I am fearful of the future. Previous Labour Gov's would stuff up & look after welfare & unions but we could look forward to a Lib/Nat gov reversing the situation..... Not this time...what a sad Gov we have. So many oppertunities lost & now too late. Welcome Short Willie...God Help us. Sibcat

WHY DON'T WE HAVE A FLAT RATE OF TAX? SAY 10%... OK Larry. I asked the question. It's so bloody simple, even that idiot "wanna be" Treasurer could understand it. (Maybe.) But I guess that wouldn't suit them. The thieving bastards couldn't lie about things. Hope you had a wonderful Anzac Day mate.

I seem to recall a story about an industrious ant and the loafing grasshopper, that is also our problem, to many grasshoppers, not enough ants.

Sir Joh proposed a 20% flat tax on income in the 1980s. We had John Stone (who had just quit as head of Treasury) as guest speaker for a sell-out lunch of 550 guests at the newly opened Sheraton Hotel in Brisbane in November 1984. Senator Glen Sheil met with him there and asked him would Joh's flat tax work? Stone said yes it would if you cut the cost of government. As a result of that lunch, John Stone became a National Party Senator for Queensland and I wrote a book about an even flatter tax, a 2 percent spending tax which would achieve extraordinary advances in increased motivation, productivity and minimisation of churning taxes within government departments - ergo cutting the costs of government and growing the economic cake.

The last time I looked, about 30 years ago, the Taxation Act was 10cm thick!

Simple really - get everyone - and I mean everyone including companies to pay 5% tax on income. Goodbye tax dept.

So your solution is to kill all 1.5 billion of them?

Taxation is theft! And elections are merely the advance auction of stolen goods!

Been saying exactly this for 50 years - trust you haven't wasted your time Larry -

Russia and China: Watch Out Moody’s, Here We Come!
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Over the past approximate quarter century of so-called economic globalization, Wall Street’s ability to be the home of the only dominant “global” rating agencies to bestow ratings on the credit-worthiness of the world has been one of the most effective weapons of financial warfare in the Wall Street arsenal. They rate nations as well as private corporations. Now an answer to the Moody’s-Standard & Poors-Fitch US rating monopoly is coming. Not from the EU, where it is long overdue. It is coming from Russia and China, as so many bold and challenging initiatives of late.
First appeared: http://journal-neo.org/2015/01/22/watch-out-moody-s-here-we-come/
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Today, despite repeated financial crises where the New York Big Three credit rating agencies either failed or acted with clear political bias to rate, a virtual global monopoly is held by Moody’s, Standard & Poor’s and Fitch Ratings. The ‘Big Three’ as they are called, issued 98% of all credit ratings in the United States and roughly 95% worldwide. That’s influence, brother........
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........The Dollar System that I describe in detail in my book, Gods of Money: Wall Street and the Death of the American Century (Der Untergang des Dollar-Imperiums), has been at the center of the power of the Wall Street Money Trust (as it once was correctly named) and the American oligarchs ever since they created the Bretton Woods Treaty in 1944.
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Now that same dollar system is facing an existential crisis and the power of those same oligarchs to increase their power through wars everywhere—wars financed by the savings of other nations such as Germany, or Japan or China or Russia—is threatened as never before. To survive they are unleashing global financial sanctions wars against countries like Syria, Iran, Russia; currency wars and now a de facto “rating war.”
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After the defeat of Germany and the Axis powers in 1945, the families who controlled the banks of Wall Street and of Lower Manhattan—Chase Bank, Citibank, or Morgan Stanley, Lehman Brothers, Merrill Lynch–built a de facto empire in which, according to the rules they imposed on a defeated world, including a bankrupt Britain, would be based on the supremacy of the US dollar in the world....."
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http://journal-neo.org/2015/01/22/watch-out-moody-s-here-we-come/

"Despite more than a year of claiming otherwise, the US-backed government of Ukraine is now openly acknowledging their close association with NATO. Although the rhetoric is carefully guarded so as not to admit that Ukraine has become a de facto NATO member, the inescapable fact is that it is in all but name..........In what can only be described as an insult to the intelligence of international observers, and an affront to decency and truth, Yatsenyuk justified this new partnership with NATO by describing the organization as “fighting for global peace.” If NATO is fighting for global peace, the world can only shudder to think how it might act if it were spoiling for war........"
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http://journal-neo.org/2015/04/24/ukraine-partnering-with-nato-to-the-surprise-of-no-one/

They introduced a carbon tax to dissuade people from using so much electricity. What does income tax dissuade people from doing

Not sport shooting muzzies and they prefer combat when your back is turned