NetNews Usenet Archive 1992 #31/NN_1992_31.iso/spool/aus/politics/2123

Text File | 1992-12-23 | 4.2 KB | 94 lines

Newsgroups: aus.politics
Path: sparky!uunet!munnari.oz.au!titan!root
From: [e-mail] (Chris O'Neill)
Subject: Re: Fightback! the politics and the sums
Message-ID: <[e-mail]>
Sender: [e-mail] (System PRIVILEGED Account)
Organization: Telecom Australia Research Laboratories
References: <[e-mail]> <[e-mail]> <[e-mail]> <[e-mail]>
Date: Tue, 22 Dec 1992 23:44:52 GMT
Lines: 82

In article <[e-mail]> [e-mail] (Ray Loyzaga)
writes:
>In article <[e-mail]> [e-mail] (Chris
O'Neill) writes:
>>In article <[e-mail]> [e-mail] (Ray Loyzaga)
>>writes:
>>>In article <[e-mail]> [e-mail]
>>(Mark Jose) writes:
>>>>Original Message From: [e-mail] (Chris Maltby)
>>>>I agree. The fact that the upper tax brackets will get two adjustments
>>>>to their tax thresholds is a slap in the face for all those middle
>>>>income workers on the average wage or below who have suffered for
>>>>years under a totalitarian wages regime.
>>>
>>>One of the reasons for this is to bring the highest bracket down to
>>>the corporate rate, which should eliminate most of the dodgy things
>>>people do with personal companies etc.
>>
>>i.e. instead of forcing people to do dodgy things to reduce their tax, the
>>government just gives up and reduces their tax anyway.
>
>Well it is raising the company tax to 42% from 39, and lowering the
>highest marginal rate from 47 to 42.

Thanks for the history lesson.

>>>>The big selling
>>>>point seems to be "well you'll get more in child endowment". Well what
>>>>happens if you are single or married and without children. Does this
>>>
>>>Tax cuts below $15k average 4.8%,
>>
>>Where do you get this figure from?
>>
>>Earlier this year, I posted the following table showing the Fightback tax
cuts
>>versus income calculated by Dr. John Quiggin from the Australian National
>>University Dept. of Economics.  This was published in 'The Age' on 28th
>>November, 1991.
>>
>>Income level    Real tax cut   As % of       As % of
>> $91-92          $91-92        gross income  net income
>>
>> 7000             118.94        1.7           1.8
>> 8000             156.94        2.0           2.1
>> 9000             194.94        2.2           2.4
>>10000             232.94        2.3           2.6
>>15000             422.94        2.8           3.2
>>20000             144.99        0.7           0.8
>>25000             418.99        1.7           2.1
>>30000             818.99        2.7           3.5
>>35000            1218.99        3.5           4.6
>>40000            2065.51        5.2           7.1
>>50000            3065.51        6.1           8.8
>>60000            4267.67        7.1          10.7
>>
>>This table assumes an average inflation rate of 4% between now and 1995-96
when
>>the package would be in operation.  The real tax cut takes account of the
>>fiscal drag that would occur because of this inflation. (Note that the Hewson
>>tax scales must be based on dollars in 1995-96 or there will be a $2.9
billion
>>We can see that the only people better off with a 4% rise in indirect tax as
>>a result of GST will be those earning more than $30000.  This is a minority
of
>>people.
>>These figures take into account the $1.2 billion that the coalition expects
to
>>reap from the black economy.  The coalition expects such a figure even though
>>Mr. Reith (their shadow Treasurer) has attended a seminar at which officials
>>from Canada and New Zealand denied their GST systems had produced big gains
>>from the black economy.

<Argument saying that Fightback does not intend to compensate for fiscal drag
between now and when it is implemented, deleted.>

So you're actually agreeing that the Coalition was planning to allow fiscal
drag, that the benefits/losses under the old Fightback were as John Quiggin
calculated, and that the Coalition was keeping quiet the fact that it was
relying on fiscal drag and hence the fact that people with incomes of less than
$30,000 would have been worse off than they are now.  Well, the Coalition and
Ray Loyzaga certainly know how to put up a slippery argument.