We should be grateful to Labor, Bill Shorten and Chris Bowen for one thing at least. They have switched the Canberra vaudeville to off at least for a few days and taken the nation to a place where we can once again discuss the relative merits and deficits of government and opposition rather than standing aghast at the tawdry comings and goings in the nation’s capital.
Indeed, it was such an abrupt departure from the freak show that one cartoonist, musing on the difficulties of drawing a cartoon on the humour free zone of franking credits yesterday, took to social media to implore Barnaby Joyce to “do something.”
Let’s start with what Shorten’s announcement isn’t. It isn’t taxation reform in any substantial way. The Australian taxation system is and will continue to be unnecessarily complex and complicated, an ongoing garden party for accountants and lawyers but dismally incomprehensible to almost every other Australian.
A week or so ago I joked that Shorten’s media advisers should instruct him to have a long lie in, go into the office late, take the rest of the day off and continue to do so until the next election. Cynically, this is perhaps Shorten’s best pathway to the Lodge.
Before the last election, Labor determined to get a lot of policy into the public domain and while they fell short of forming government, the view is the party’s strategy was the right one. After the 2013 landslide win for the Coalition, Labor’s policy rollout in 2016 put them within one seat of forming minority government.
The Shorten tax proposal is more of the same with an eye to the next federal election.
As Adam Creighton observed in today’s Australian, “Australia’s tax system is shockingly tilted in favour of older, wealthier people, with little justification. Without a proper overhaul, in an era of stagnant wage growth and elevated house prices, that only fuels resentment.”
Labor’s proposals mine that resentment deep and hard. The government’s rhetoric then and now of a Shorten-Labor faux class war does not paint even half the picture. The old resentments between haves and have nots certainly exist and are palpable in the electorate but they find deeper expression across generational divides, among those who despair about housing affordability in the major capital cities with inflation stalking tepid wage growth.
Put succinctly, if by soulless marketing demographics, Shorten’s approach pits Baby Boomers v the rest — the Millennials, the Gen X-ers, the Gen Y-ers and whatever other absurd monikers the marketing folk attach to people these days. Whatever, the iron laws of arithmetic tell us there are more of them than there are of the boomers and in politics, that is enough to win elections.
The take home message is that Labor believes self-funded retirees do not as a rule vote Labor and the political consequences are likely to be minimal. Little downside, lots of upside is the prevailing view within the party at this point in the political cycle.
Labor’s proposal pushes the government further into a corner. Malcolm Turnbull knows he cannot get his company tax cuts through the Senate and has gone to a Plan B of personal income tax cuts but these will come at the expense of adding to the budget deficit and with it, the government’s claims of superior economic stewardship become sorely tested. Ongoing personal tax cuts of any impressive magnitude are almost impossible to fund without wholesale tax reform. The government will be left to tinker at the edges, leaving a benefit to average wage-earning folk of the packet of Chicken Twisties and can of diet Coke variety.
Bear in mind, the 2018-19 Budget will almost certainly be the Turnbull government’s last before the next election. A half Senate election is due no later than 19 May, 2019 (the Reps by 2 November, 2019) and one very much doubts the Turnbull government would create a circumstance where the punters would be obliged to trudge off to the polls twice in one year. Just as likely is a federal election in the latter part of this year.
To paraphrase Black Adder, Bill Shorten has “a plan so cunning you could put a tail on it and call it a weasel.” And without wanting to press the Vaudeville activation button, that weasel is Chris Bowen. Bowen is cast from the NSW right, an economic policy wonk and Keating acolyte. While he is invariably across his brief, it is his skills as a salesman that often fall short.
The reforms-that-aren’t approach is bold, and boldness or courage is not always rewarded in politics as it often veers into callow stupidity when the numbers are scrutinised and fall short or the government of the day spends each and every day picking the policy off to the point where an opposition is left befuddled and paralysed with embarrassment.
But if Chris Bowen can pull it off, Labor has just taken a step closer to forming the next government.
This is interesting & scary…
https://www.theguardian.com/commentisfree/2018/mar/15/our-government-is-boiling-the-water-we-swim-in-but-we-can-still-jump-out 🐸
” modelling showed that 75% of benefits of dividend imputation flowed to households with incomes in the top 10%. Almost half the benefits go to individuals earning over $180,000 who make up only 2.2% of the population.”
By $ amount but not in numbers of people.
If you are paying the top tax bracket, of course you will get more back in imputation benefits and you will have more shares.
Those on the on the lower incomes, if they have shares, proportionally benefit There are more of them than the top bracket people so can do more harm to Shorten..
“Luckily for them, Peter Costello changed the law in 2000 to allow any surplus credits to be swapped for cash meaning that rather than paying no tax, they get paid $3000 by the taxpayer.” “Remember, this act of extreme generosity comes from our revenue-starved budget and has blown out from initial budget cost of $500 million per annum, to what is estimated to soon be $8 billion a year” “Australia is the only developed country in the world in having the cash rebate provision that Costello and Howard introduced”
http://www.tai.org.au/content/how-some-wealthiest-australians-pay-negative-tax
it’s all budget repair budget repair budget repair budget repair….oi hang on! , funny as hell
$5K hit to my super this week. Thanks Bill.
Whaat? have the proposed changes been passed through both houses already? Or are you claiming a fall in the market is due to the proposed changes? Seriously you gotti be kidding.
Already ??
I had to check whether some details were updated. (As you know, Unisuper’s admin processes are last century.) So checked every couple of days this week. Yep, between the announcement and yesterday, -$5K. I am heavily invested in the share market riding the US boom. But, about 30% in local shares.
Superfund going up and down like a yoyo, Dwight. I don’t look daily anymore. International shares have done well though. Just hope someone is buying when they are on a downer!
I took a hit too Dwight, but that was last month, I dread to see what’s going to happen this month. Might have to sell everything we own in Australia, live and travel around in our caravan….still I can think of worst fates 🙂
So who’s fault was it when the Markets dropped 5% in Feb.? Seriously get a grip.
Seriously, you should loosen your grip and pull your head in, Dismayed. Your constant shrill, hysterics produce only laughter and pity, in equal measure. The infantile abuse, that is your stock standard response, sends out alarm bells to the smarter, more experienced, worldly, and often better read, types on here [and even me!] that sing out your ignorance on things you pretend to know, and your sad and dismayed awareness of your own inferiority. Rather than take your frustrations out on strangers, in a cowardly way, strive to be a better and bigger man.
You have been sent a Koala Stamp
Well put Milton but he hasn’t got it in him.
Milton you should stop drinking and posting late at night or early mornings and put your efforts into trying to find out what “comprehension” is, you seem to have a huge deficit in that regard. I feel sorry for those around you with your obvious health issues. ARBD is a serous issue and requires long term treatment.
https://americanaddictioncenters.org/alcoholism-treatment/mental-effects/
I note you’ve stolen JB’s hackneyed attempt at silencing. About time you grew up. son.
Dismayed is right. You can’t possibly blame Bill Shorten for losses incurred last month. I took quite a large hit back in 2008 when the whol world was in turmoil financially. That is the risk you take, blaming politicians is silly, however the banks and financial institutions are another story
To be frank, the imputation that any future government should be given credit if they simply slip their sticky fingers into previously hardworking pensioners’ hip pockets is outrageous. Particularly so, if it’s to seemingly redistribute the meagre takings to others within our community who, though able, may never have raised a sweat or struck a blow in anger (or even worse).
It would be especially galling for those folk who made sacrifices throughout their working life by placing any of their “spare” hard earned into local equities and thereby demonstrating their belief, not only in the ongoing success of the enterprises, but being hopeful their decision would provide a small supplementary but regular dividend as they prepare to embark upon their new journey of expected unimpeded endeavour during their twilight years.
Hip pocket incursions of the aforementioned category are usually conducted by the insidious hardhearted who take much delight in perpetuating a phoney war of social disharmony and envy.
More of the same selfish whingeing from the generation that the rest of Australia paid for throughout their lives and continue to subsidise above reasonable limits. No one should get back more than they have paid unless it is capital stock for the use of generating more business. The unfunded Howard taxpayers largesse was wrong when implemented it is wrong now. Stop whinging about everyone else getting a minute concessions that the older and mostly wealthier have been getting since howard bought their votes with every taxpayers money. the coalitions deeming changes had a much greater effect than this. the coalition Modest Super changes had a greater effect than this.
Dismayed, you clearly demonstrate your ignorance of the corporate tax system involving dividend imputation and franking credits being passed on to shareholders when you refer to it as a “double dipping lurk”. If it was a dodgy scheme (which it isn’t), your mob went along with it when introduced by the conservatives. However, your mob may have erroneously thought it was a “lurk” (which it wasn’t) and that’s why they agreed to it. As you know Dismayed, your mob is closely affiliated with experts who are in the “lurk” business.
But putting all that to one side, I understand that anyone who has a “house full of fridges and freezers, a pool, a sauna, etc, etc and who runs their aircon 24/7 and pays $2100 power bills” couldn’t give a hooty- toot about a few pensioners and whether or not they may rely on those few extra dollars each year, thanks to a legit government policy.
cotc, stop your whingeing you have had decades of taxpayer funded largesse with all the concessions paid for by future generations of taxpayers and accessing this double dipping tax rort. It is clearly double dipping because the marginal tax rate is lowered then you want to claim again with a bonus top up? People will still get their franked credits to reduce the marginal tax rate. you just wont get to double dip for the cash bonus. those crying poor because their taxable income is $ below the threshold or $0 have done so through utilising the system. those that have $500K in assets still receive the full pensions and every other concession too bad if you have to actually start using your capital. The proposal to remove this rort has again highlighted just how greedy and self serving wealthy older Australians are. No Surprises. Oh and $2100 Per Year on electricity is a small price to pay to have facilities for young Australians to be able to stay healthy ( I did not mention the fully decked out gym in the back yard) and gather together to chill and hang out rather than them hitting the streets or pubs or having accidents in cars etc. you have again just highlighted the sad and insular selfish mindset of many of your generation.
Dismayed, so in addition to the absolute swag of exotic household paraphernalia you have previously itemised on here, you now reveal that you also possess a ” fully decked out gym in the back yard”!
May I suggest Dismayed, given your penchant for tedious carping, be careful not to extend yourself on the dumbells lest you be seen as one of those peevish nouveau riche, Johnny-come-latelys stranded in a malaise of unrequited recognition.
But you still make me laugh mate. 😆
You reckon it was unfunded.
Stop rewriting history.
http://www.budget.gov.au/2000-01/highlhts/glossy.pdf
Unfunded. Its a rort. No debate. At least you found your way back here. Stay cool you know how you get.
JS are you trying to say the 00/01 budget applies to the current fiscal equation? Man put down the mirror and look to the front.
No – it was you who stated “Howard’s unfunded ” and was just pointing out that you were twisting history, as usual, to suit your inane arguments.
Hello JS, was going to drop you a line to see if you were ok and all.
Still here thanks TV.
I have been lurking and wondering why JTI puts up with some of us.
More patience than Jesus.
TV, can you e-mail me anyhow – I have lost all your details.
Hey JS. I was wondering what had happened to you! welcome back to the loony bin 🙂
Thanks
I fit in perfectly 🙂
Also tweaking the super rules (for the umpteenth time) does not qualify as a phoney war of social disharmony and envy. Stop channelling opinionistas from the IPA. Btw did you have that opinion when the Libs refused to up super, hence the difference between Keating’s projections and reality now. Hands up all those with a vested interest through share ownership. I am one and in my early sixties with retirement on the horizon and I don’t have a problem with it. What is yours? The elderly are a bunch of whingers anyhow. Have you not noticed? My mum lives alone on a full pension and banks 40% of it. Continually giving away money to great and grandchildren so as not to have assets problems. Australians are incapable of living within their means hence the national indebtedness private and public. All the whinging about the tweak comes from the need to feed on the public teat to support the lifestyle to which they have become accustomed.
Good to see back and firing again CoHD. your concise analysis has been missed.
I thought my old mum and dad were the only people who actually saved on the pension! Since the old fella passed I’ve actually been getting her to spend a bit on some travel but it isnt easy. They come from a frugal generation.
My dad still gives money to the likes of the Guide Dogs and so on. Finds it somewhere.
Imagine if you can just how dire it is for those pensioners who have never owned their own home and have no superannuation to draw on. It’s these people I see everyday, it’s these people who are always a fortnight away from homelessness & it’s these people who struggle to put one decent meal together in the last few days before the next payment.
As homeowners a couple on the age pension saves a lot less than a single pensioner does, but without todays exorbitant rents.
I just hope that the folks who’re upset about their current super ‘losses’ know just how well-off they really are in our increasingly unjust society. Not everyone had the education nor the opportunities.
Bella – has qld got rid of most housing commission places? and not knowing what rental assistance is $$wise I’ve no doubt that even after that there’d be sufficient funds even for a modest and satisfactory existence. I’ve long promoted the idea of humanely designed 1 or 2 bedroom apartments, solidly built, inner city, with communal gardens, solely for those that require it. Surely that is not beyond the wit of our 3 tiered govt.
I don’t understand this, Bella:
“As homeowners a couple on the age pension saves a lot less than a single pensioner does, but without todays exorbitant rents.”
No education for my mum and dad Bella. Just hard work.
Hear hear Bella, hear hear.
Post got lost so repeat. I see Carl that you subscribe to Hockey’s lifters and leaners model. I also not that you consider super contributions as a sacrifice for a better society. Most super comes from employers like me. People make contributions to super because of greed. They think they will be better off by doing so. Also reduces tax. Nothing to see, no altruism here, move along Carl. It is only self interest . I pay my staff the full 12.5% it should have been by now if not for the indifference of the Libs to super. It is why the aging population is a problem. But to be fair Carl they were pretty words in the right grammatical order but so is most propaganda.
The Libs not paying interest to super could be construed as covert class warfare
The Libs not paying interest to super over the years could be construed as covert class warfare
CoHD
Curmudgeon, I have noted your various posts and I’m going to cut you some slack and give you the benefit of the doubt that your past and/or your present incapacities (whatever they may be) has most probably caused you to assert that “the elderly are a bunch of whingers anyway”. As you have referred to your elderly mother’s situation in one of your posts, I assume you include her in the cohort you now disparage.
I dare say that if I had ever uttered such a view re my Mum I’d seriously have to consider cutting my tongue out. I hold, and have always held that mothers are the most precious folk on this earth bar none, irrespective of their faults or failings. To deny that sentiment is to rebuff our very existence.
Having got that off my chest and notwithstanding our differing points of view during past years, I’m genuinely pleased that you’re up and about and feeling your old self again. Any chap who looks after his employees as you obviously do is a good and decent fellow. I wish you well with your ongoing health issues and trust you’re on the right path to improvement.
My 91 yo mum thinks that pensioners are a mob of whingers too. Sorry that you had to twist my words as an attack on the elderly and particularly mothers but that has been your M.O. for quite a while, so no surprise there. I sympathise with pensioners who don’t own a house and personally have helped many homeless people in my life. I also know many retired people who whinge because they can’t go on all the cruises that they wish or can only afford one servant in their Bali villa. The sense of entitlement in our society does not exclude the elderly.
CoHD
“Whingers” – those who whine, carp, grouse and complain persistently in a peevish and irritating way.
As a recognised Carer for a number of years, I wouldn’t categorise the elderly as above. But then again, perhaps I may largely encounter a more resolute and undaunted group.
PS. my apologies for perceived “twisting”.
As soon as I am able to get my hands on my Super I’m grabbing the lot to try and keep the pollies grubby little hands off it. It’s currently in Australian Super, high risk fund and is making better money than the Insurance company I had it with before but no doubt Shortens latest brain fart will have implications for shares all down the line.
Notice this morning he’s talking about compensating those at the lower end of the spectrum, so what’s the bloody point?
Every time they come out with the fix the bottom line mantra ( both sides) they hand out yet more largesse …..reform the tax system Richard Craniums, Super was never meant to be a way of dodging tax but that’s what’s its become and those of us who do the right thing are the ones who will wear it.
The Bloody point is to save $6 Billion and rising per year that mostly goes to Wealthy people who pay no tax. You should look a little deeper to understand the point. You are stating Super was never meant to be away of dodging tax and complain about a very fair way to fix some of that dodging. Every effort to reform the tax system has been stopped with hysterical screeching like yours and in every article in the Australian and by a misleading coalition. I get it. those close to retirement don’t want to be effected, they don’t want to lose the tax lurks they put in place for themselves, let the next generations deal with the problems the ones before created. These are the Howard/Costello unfunded decisions on tax, Super and various other concessions across multiple areas that the Nation has been paying for and will continue to pay for. Perhaps you should start to have a look at your team for a change.?
Howard/Costello?? Surely Rudd, the genius treasurer Swan, and Gillard could have sorted out those failures you perceive of the coalition in the time they had? They even had the Henry whatever it was, and Rudd, Swan, Gillard squibbed it. Shorten, i’m guessing, has less spine than that trio of mediocrity.
Yes the Henry review recommended removing this tax rort. As has just about every real economist. As we have seen the last couple of days the hysteria and media efforts to misinform on labor policy announcements makes it very difficult to try and work in the National interest. The failure of the Howard/Costello regime are far from perceived they are real and very costly to Nation. Your rear view mirror version of events again highlights you should seek advice from someone who has a grasp on actualities.
My rear view mirror observes we’ve had a labor govt since Howard/Costello. Why didn’t labor fix what you consider real failure’s?
Stop talking sense Milton.
sigh. for 5 years your man the idiot abbott refused to support savings measures. Milton get someone to explain what is actually happening on the planet to you between pints.
I was under the impression that labor via RGR got a record number of matters through parliament. And they were in a coalition with the Greens. And you blame Abbott. What a nonsense you waffle.
Dismayed says: “…. you should seek advice from someone who has a grasp on actualities.”
Probability not much use seeking your advice Dismayed, your “grasp” capacity seems to be mostly in overdrive mate.
Goodness Mr Insider, I am a self funded retiree who has voted both Labor and Liberal down through the years. Thank you Bill Shorten for helping me to make up my mind who to vote for some possible 18 months from an election, in my case neither major of minor parties unless the light shines a lot brighter before then. Bill of course is tapping into the masses who cant stand Turnbull and his weak government and to be honest I think he will be PM come the next election, god help Australia!
Bowen is certainly no salesman, nor has he Keating’s ability to articulate complicated money matters so the person in the street can understand them. Though you may be right in suggesting this could set labor apart from a stumbling, visionless coalition. So far they’ve fallen since that majestic 2013 landslide win led by…..
Chicken twisties and a diet coke? Luxury, bloody luxury.
I prefer cheese twisties Milton and a Coke Zero….in fact I love cheese twisties so much, I wouldn’t share my packet with my grandaughter once and she’s never forgotten it.
yes for cheese twisties and yeh for cheezels. with the latter I like to overwhelm them in my mouth, without biting, and press out the cheesy flavour until i’m left with a soggy husk.
as far as anything goes, I go full, xxxx heavy, coke, smokes, cream, butter, coffee etc. I can’t see the point, and am suspicious, of decaf, light beer, diet whatever etc…And the vitamins that Bassy mentioned, in contrast to fresh food.
Sadly we now have a PM light and little to combat it.
and you obviously love your twisties, Penny! I recommend eating the top stuff away from prying eyes.
I’m suspicious of the chemicals used to de-caffienate coffee. Methylene chloride? Ethyl acetate? Alkaline metals?They don’t sound good to me. https://coffeeconfidential.org/health/decaffeination/
Methylene chloride is the ‘least toxic’ of the dichloromethanes. Produced by ‘scrubbing’ methane with chlorine at high temperature. Then they ‘scrub’ the green coffee bean with it to remove the only reason to drink coffee at all. Ethyl Acetate is ethylene treated with acetone. Another method uses boiling brine and arsenic, an alkaline metal.
” … don’t mind spots on my apples, leave me the birds and the bees … ”
Joni Mitchell, ‘Big Yellow Taxi’
Dead right there. Bowen came up to the Tweed to speak to his flock. I got sick of his local followers
massaging his ego. I had had enough and got up and gave him a huge serve on facts and figures. He is debater I destroyed him. After the show quite a few people came up and thanked me for saying what many were thinking. I would have Jim Chalmers, Andrew Leigh or Jason Clare in that slot. Bowen has the personality and delivery of a housebrick. He knows his stuff but cannot sell it. Tries too hard to be a gentleman.
In Liberal party speak cash handouts to wealthy retirees good. Cash handouts to the unemployed and disabled bad.
And as for the sob story in todays SMH about the former labor supporters from Glebe; this self-managed fund couple have 85% of their super in a few high-dividend Aussie shares and are on $85K per year. Hardly struggling battlers. Lives in Rozelle too, luck them.
https://www.smh.com.au/money/super-and-retirement/labor-voter-fury-over-losing-30pc-of-income-under-shorten-plan-20180314-p4z4b1.html
Saw that UQ, rusted on Labor supporters my foot (polite terminology).
I hoping to keep working for a few more years yet, but have managed to do very well out of UniSuper who have invested my (our) money well. I have always known I would never qualify for a pension and to be perfectly honest I don’t think I should. My generation really did do well by Paul Keating’s policies as we have property, super and money in the bank. The Tax Office owes us money from when we wound up our business in Australia 10 years ago and we’ll look at claiming that when we have time.
The pension worked fine for my parents, in fact they are the people who earned it and did it tough….well mine did anyway.
Some of these people claiming hard luck stories really should look around them and see the people who really are doing it tough. But because it’s the Labor party, who as far as I can see from the face of it are looking out for people who aren’t at the top end of the income bracket, the LNP think they’re on a winner here.
Let’s wait and see and I don’t agree with Bassman who says bring it in after they’ve been elected…..at least we have a policy that’s out there and being discussed
Hear Dr Penny, Hear Hear. But not sharing your twisties with the little one? dear oh dear.
I know Dismayed, but I did buy her a packet for herself, it was just smaller than mine. One of life’s lessons that will hold her in good stead.
Dr Penny. Life lesson? What that you should keep more for yourself and stuff everyone else? ( only joking, sort of ) I think that is what this blog is all about.
I used to like putting twisites of either flavour in a fresh bread roll with butter. You can keep the coke it is no longer the “real thing” or “adds life” “is it” ?
I have to admit I was lying about the Coke Zero, never drink the stuff. I’m on a ginger tea thing at the moment, along with lemon juice in the morning. Eating garlic is good too, thankfully Malaysian cuisine uses a lot of garlic and chili. One thing I’m not looking forward to is shopping in Australian supermarkets. Fruit and vegetables wrapped in plastic, eggs that really aren’t free range, sausages with too many preservatives, meat that tasteless etc. etc. Hopefully we can find farmers markets in our travels.
With regard to putting twisties into fresh bread, never tried it, but as a youngster I did like chips in a bread roll…chip butties I think they were called.
Gottliebsen’s analysis of what happens to battlers:
The Battlers: These people have been struggling to fund their pensions given low interest rates and normally have well under $1.6 million in superannuation. Their money is in pension mode and therefore the income is tax free.
For every $100 they receive in franked dividends they gain a franking credit of just over $42 which takes their taxable income to $142, which is currently tax free. But under the ALP proposal they receive no return of their franking credit so they are just over $42 in every $100 of franked dividends worse off. Their privately-funded pensions will be reduced. That’s a huge blow to the hundreds of thousands of Australians in this situation given the pitiful interest rates being received on bank deposits. Some may get partial compensation from the government pension but it will not be enough.
And those over $1.6 million pay 15% tax on their super earnings and consequently will get 50% of their franked dividends back.
So the “rich” will benefit more than the “poor”.
Oh my Gotti? you have got to be kidding? You purport to be some sort of Economics teacher? and you are propagating rank propaganda. Tell us Dwight why should people get back more than they pay? Why should the wealthiest be given another handout at the taxpayers expense? From reading various sites over the last couple of days, real economists are saying this was bad when implemented and should have been removed years ago. There is no debate. Those complaining about having this tax rort removed are talking from pure self serving selfishness.
When you can keep a civil tongue in your head you’ll get responses from me.
Dwight, if that was not a response from you then I don’t know what is. No further response required. There is nothing uncivil in my comment. It would not have been posted if there were. Gotti. is less than a provider of factual information. He is looked upon in the world of economics as a spruiker for his investments and investments advice and preferences. His misinformation on Energy and Power was lampooned and derided and rightly so across the board likewise his latest self interested efforts. It is very sad that those who want to further the understanding of economics do so through skewed delivery method. I always believed education was about empowering others to Consider and Question not to deliver ideology.
I prefer Ernie Dingo as Robert Gottliebsen in Fast Forward.
Stick with me and you’ll always be in the Black.
Tax return? Why they call it a tax return? That money ain’t never coming back…