Remove (nearly) all taxes and replace with a single nett value tax.
Remove (nearly) all taxes and replace with a nett value tax.
ATO spends vast amounts of time and effort chasing the entire population of Australia and all of its companies and overseas companies, for loads of different taxes. Why not just work out the budget for Australia's lifestyle (e.g. social services, public education, roads, etc. etc.) and then tax value rather than activity/productivity. It would be a much fairer, more frictionless, efficient system.
OLD: Currently, I (and millions of others) have some shares, every year I fill in paperwork to pay my taxes on my dividends, and if I sell my shares I pay taxes on my profits, and I claim the brokerage against my tax and I claim the account who really does the paperwork against my tax, etc. etc. The companies earn profits and pay their taxes, they use other companies products which they pay GST on to make their products, they claim back some of the GST, but also pay payroll tax, and the company employee's pay their taxes. People buying the company products pay GST. On and on and on!
NEW: Once a year, ATO calculates each companies nett value via its share price and levies the matching tax. That amount of tax is initially levied to be the same (on average) as would have been collected via the OLD way.
The government gets the same amount of money, but cheating and paperwork for everyone reduced.
No shareholders fill in any paperwork, but their expected dividends might be slightly lower.
No artificial financial friction in the system. i.e. decisions would no longer be based on relative tax rates.
NOTE: For overseas companies, the same tax applies but you scale their nett worth to % income generated in Australia. Eg. Say Google makes 5% of its income in Australia, so they pay 5% of tax of their total nett worth. This scales nicely when all the other countries copy our NEW tax system.
2. "Personal" Property (i.e. any property not held in a company/trust, which is dealt with above)
DEFINED: Mainly land/buildings, but also art, gold, etc.
OLD: Every time you move there is stamp duty. If you rent out your property, there is income tax, and GST when you sell. Building depreciation tables. Claiming for all sorts of minutia.
NEW: Personal nett worth is taxed in the same way and at the same rate as companies.
DIFFERENCE? Simpler, no cheating. Some people (especially overseas buyers who get taxed at the top level) don't even bother to rent out their properties. People will be more motivated to make their property productive if ownership of a "piece of Australia" requires you to support Australia. People who merely hoard resources and don't put them to work would slowly lose them. Use it or lose it.
NOTE: There would be a $ limit for personal nett worth for simplicity and ease of collection, and also to include a person's main residence, e.g. less than ten times Australian personal average nett worth (currently about $500,000, so $5 mil) would be tax-free. Anyone who is paying tax on their nett worth is quite wealthy and a) can afford it, b) should be proud of the fact they are doing well enough to be paying tax.
The NEW tax, collects based on total value of Australia.
Not on foolish things like how often people move home. How often people buy petrol, etc. etc.
The only taxes that would need to be left are ones for correcting other health/environmental issues.
e.g. tax on cigarettes, alcohol, carbon, sugar? etc. etc.
This NEW tax encourages activity/productivity and discourages sitting on resources.
I would expect the economy to hit full healthy speed under such a tax system.