cry of the banshee wrote:
Right, I missed this.
I think that a flat rate, straight across the board, tax is the only fair method.
Everybody pays the exact same percentage of their wealth.
And whatever the revenue is, that is the budget the government has to work with.
100% agree.
There's a practical component too. Simple tax systems are easier for business and individuals to work with, less costly to implement and are generally more effective at capturing revenue than complicated ones.
The tax system in Australia has become unmanageable given how complex it has become to take into account every possible manner of social good and ill.
Here's how the tax system works for an individual
For every 0-6000 of income you pay 0% on the dollar
Between $6,001 and $35,000, you pay 15% tax on every extra dollar earned.
Between $35,001 and $80,000 it's 30% for every extra dollar
Between $80,001 and $180,000 it's 38% for every extra dollar
Over $180,000 it's 45% of every extra dollar
Then there's the following add-ons:
Medicare Levy: 1.0% if you earn over set amount
Extra Medicare Levy: 1.0% extra if you don't have private health cover.
These are offset by Family Tax Rebates and Private Health Cover rebates.
Figures don't include deducations for earning an income.
Then you regularly pay the following taxes:
Goods and Services Tax (VAT): 10%
Excise tax: Applicable to cigarettes, alcohol, fuel (varies)
Stamp Duty: ad hoc and slapped on many items including taxes.
Then there's corporate taxes.
A report about 5 years ago stated that even accountants don't fully understand the tax system.
It's a system so full of holes that it's easy to get away from paying anything if you have a good accountant.
It's complexity is a big hinderance to business.