Australia: A true Tax haven


Camp Julia and her band of collectors have come up with another brilliant idea to stop a budget gap: a tax increase. The medicare levy more specifically is to be raised from 1.5% to 2%. 

Australia really is becoming a tax haven, for the government that is. Companies must be behind the eight ball, as when they loose money, they resort to almost archaic concepts such cutting spending, restructuring or increasing their output to aid their bottom line. Not so this government, or most governments for that matter. Why? Simply because they don’t have to. The federal government is in a monopoly position. There is no else to compete against when it comes to raising taxes. If companies agree with their competitors to increase prices to prop up their bottom lines they get the ACCC knocking. This burden does not befall the government. Not enough money? No problems, we’ll just get some more. There is less incentive to spend wisely. When you see the bottom of the well you simply get some more water seems to be the adage used by the Gillard government. Sure, Wayne Swan keeps beating his chest that in absolute $ figures our spendable income is more than prior to ’07. This however is pseudo economics by the Treasurer as he does not take into account inflation and the rising cost of living. A slab of beer, loaf of bread or your power bill is definitely dearer now than prior to ’07. 

Resorting to taxing the populace more and more on the one hand and giving money back with the other, through benefits, rebates etc. is another symptom of inefficiency. What company would charge their customers more upfront and then refunding part of the increase after the purchase while they foot the bill for administrating the refund? Right, no solvent company on the planet. Yet this is all this government seems to do. The best example is the much debated carbon tax, a complete folly as far a the purpose of taxation is concerned: the majority of Australian would be better off after the tax (?). Would it not be better not to have the tax and save us the (exorbitant) administration costs? They cost savings would then be allocated to fund sustainable energy projects. Not possible, we love our numerous taxes, just like our numerous codes of football. Not having weather like in the UK, unemployment like in Spain or overpopulation pretty much everywhere else, what would be left to complain about?
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