Thoughts on Taxes?

[syednaeemul]

I read this article just now and felt it was very attacking (it literally uses the words "attack the rich" too!) towards the wealthy. What are your thoughts?

My own opinion is the wealthy didn't just jump into a money pit suddenly, and they're already taxed at higher rates under Australia's graded system, so why grab more?

Also found it a bit silly that the article refers to the rich taking trips to Paris as business expenses; maybe there are some like that, but surely the wealthier are not so stupid / would get scrutinised by the tax office more?

http://www.theage.com.au/comment/how-to-hit-the-rich-where-it-really-hurts-20160211-gmr7c8.html?google_editors_picks=true

[Drifterrider]

"Tax the Rich" is a ploy most often used to get people to increase taxes on themselves (without them knowing it). 

When the US introduced an income tax is was only on "them rich people".  Probably the same everywhere.

People love to vote a tax on their neighbors not realizing their neighbors are doing the same thing.

[alsoknownasDean]

Yeah the article didn't ring with me either. And as mentioned in the article,  those with higher incomes can do more to minimise their tax bill, especially if they're not spending the lot.

Although our government has been going on about a 'budget emergency' for years. Some of the measures they have suggested to cut expenditure have been unpopular, so maybe it's more politically palatable to focus on the revenue side, especially if it's perceived to not hurt the 'battlers'.

What has a greater economic impact, asking the poorest 20% to contribute $1 each, or the wealthiest 4% to contribute $5 each?

Although the other issue here in Australia is that of Federal - State relations. Many of the portfolios traditionally handled by state governments, the federal government is involved in. Should there be a clearer delineation between Federal and State responsibilities? Should states be given more power to levy their own taxes?

For the non-Australians here, sales tax (GST) here is a uniform rate nationwide, collected by the Federal Government and distributed to the states, and states do not impose their own income taxes.



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[FINate]

I can't help but wonder about unintended consequences. Would the wealthy downsize housing and shift capital to other investments? If so, would this be common enough to depress the value of high end real estate? It reminds me a bit of the luxury tax the US attempted in the 1990s. Demand for luxury items (yachts, luxury watches, and luxury housing) are highly elastic so demand dropped and the costs of the tax was primarily paid by the people working in those industries.