IR Reform: Let Banks Collect P.A.Y.E. Tax

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The Howard government’s industrial relations agenda attacks the wages and conditions of workers as if this were the only way to reduce the cost of hiring. What about the administrative costs imposed by government? For example: If you become an employer, you must also become a tax collector and tax agent, deducting and remitting pay-as-you-earn […]

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Negative Gearing: Incompetence Or Conspiracy?

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A rental property is said to be negatively geared if the owner’s expenses (including mortgage interest and maintenance) exceed the rental income, so that the property makes an annual loss. If the tax system allows negative gearing deductibility, that loss can be deducted from other income for tax purposes. Abolition of this deductibility, loosely known […]

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IR Reform: Who Really Wins?

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Who are the real winners and losers under the Howard government’s industrial relations reforms? We think you can work it out for yourselves. Here are some hints: 1. If workers in firms with less than 100 employees have lost their protection against unfair dismissal (not to be confused with unlawful dismissal), and if all other […]

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IR Reform: Unmentionable Barriers To Job-creation

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The Howard government’s industrial relations agenda is supposedly about job-creation, as if the cost of labour — including wages and salaries, penalty rates and other perks, and the difficulty of reversing bad hiring decisions — were the last remaining barrier to full employment. Sorry that we have to state the bleeding obvious, but: Jobs cannot […]

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Infrastructure: No Pork Barrel Needed

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In every marginal electorate, politicians promise to take revenue raised by nationwide or statewide taxes and spend it on projects that confer purely local economic benefits. This practice is corrupt and unnecessary — corrupt because a minority of taxpayers are bribed at the expense of the majority, and unnecessary because, if a project is economically […]

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Infrastructure: Free Riders on the Tollway

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The Mitcham-Frankston tollway, also known as EastLink, will reduce commuting times in suburbs serviced by the tollway and in suburbs serviced by alternative routes, such as the untolled Springvale and Stud roads, whose congestion levels will be reduced by EastLink. The market value of this benefit (net of tolls) will be manifested as uplifts in […]

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Globalisation: Shortcut to the Bottom

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In this age of internationally mobile capital, we are repeatedly told that if we want to attract and retain investment, we must make our tax system more “competitive”. Very conveniently for the investors, competitive taxes are taken to mean low taxes, in which case governments must engage in a “race to the bottom” — competitively […]

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The Progressive Flat Tax

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The flat tax fanatics are back. They say that if there were only one rate of income tax, the system would be simpler, and the rich couldn’t reduce their tax by converting one kind of income into another kind taxed at a lower rate. In the case of a pure flat tax — that is, […]

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FHOG Reloaded: New Home Builders’ Grant

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SPIN: The First Home Owners’ Grant (FHOG) helps first-time home buyers enter the market. FACT: More precisely, the FHOG helps first-time buyers to compete with other buyers who can use the equity in their old homes to bid up prices. But by increasing bids from first-time buyers, the FHOG also raises prices, especially at the […]

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The Property Owner’s Suicide Bomb

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In 1978 the voters of California, resentful of increases in property tax assessments caused by rapidly rising land values, enacted Proposition 13, which added Article 13A to the state constitution. This Article limited annual property taxes to 1% of the assessed value, capped annual increases in the taxable value until the property was sold, and […]

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