There's a trend here, I seem to be going for organisations or governments rather than individuals but this week's Friday Fuckwit is the ATO. The Australian Taxation Office. Tax here is so, so, complicated. Frankly I'm an advocate of a flat tax rate 10% that's what I charge my kids in board . . .that way the everyone pays what they can. And the middle class as always, just muddle on. Instead, we have a graduated taxation system, a Goods and Services Tax (extra 10% on everything goodsy and servicy), Sales Tax (which was supposed to have been abolished since GST), Ecsie on alcohol, cigarettes and petrol, Stamp Duty on property purchases - for Christ's sake how much does whacking a rubber stamp on a changed deed cost? All I can say about our Government and it really doesn't matter which party is in power - is that there's a massive bureaucracy dependent upon a complex tax system. I am the first to put my hand up for free education and medicine and don't mind paying tax to fund such things but . . .
You know . . I am the Google Queen (bow down and pay me lip service) but no amount of Googling will tell me how many employees there are in the Australian Tax Office. No there aren't a bunch of nerds in some centralised underground bunker crunching numbers. The heavily accented ones are all over the shop. Although EVERY time I ring for a work related issue, I find myself talking to someone in Hobart, Wollongong, Taree, Newcastle . . no-one knows where that 1300 number will lead them and it ain't to Ms Dusky voice . . ."Call me . . .*deep sigh* call me now!"
Calculating income tax is proportionate and therefore complicated. You pay no tax for the first $6000, then a bit more for the next $30,00 then a bit more . . .
2008 Tax Rates:
0- $6000 tax on this income - none
$6,001 – $34,000 tax on this income 15 cents in the dollar over $6,000
$34,001 – $80,000, tax on this income $4,200 plus 30c for each $1 over $34,000
$80,001 – $180,000, tax on this income $18,000 plus 40c for each $1 over $80,000
$180,001 and over, tax on this income $58,000 plus 45c for each $1 over $180,000
Then there's the drama of working out your deductions. If you're Pay as You Go, you're pretty stuffed because your employer pays for any likely deductions. But there are business deductions, charitable deductions, superannuation deductions, pension deductions, Health Care deductions . . .I'm sooooo, over-undeducted. If you're in your own business you have to lodge a quarterly Business Activity Statement (BAS) and annual IAS and no that doesn't stand for International Aids Society. Then there's the actual tax return where nobody tells you exactly what you can claim.
Sorry for the rant, I'm going through doing Clare's tax return which is going to fund her next voyage and today I've had numerous phone calls from an over zealous accountant who refuses to acknowledge that my Labrador is a guard dog and clearly doesn't know what Graphic Design is, let alone what can be claimed - she's driving me insane. Gooch you're a pooch . .where are you when I need you most. You got her a $3000 return last year and now you've abrogated all responsibility because Jem isn't your lover! Piss weak and poor form! You're not sliding on my slippy slide this January! You no-longer deserve a place at my sausage sizzle!
Can we all please just pay a flat rate. . . no deductions . . based on earnings . . .is that a bad thing or am I just a simplistic oaf . .please . .someone explain what the best tax system might be . . .
I think the Danes have it right. By taxing everyone, no deductions (with a few exceptions) they've reduced their bureaucracy (which is paid for via income tax anyway). Despite high taxation, the economy is otherwise quite unregulated and Index of Economic Freedom ranks Denmark the world's 11th most economically free country (4th in Europe). From 2006 to 2008, surveys ranked Denmark as "the happiest place in the world," based on standards of health, welfare, and education. In the 2008 survey, the Global Peace Index ranks Denmark as the second most peaceful country. Australians might reel at paying Danish-level taxes - they take 50 per cent of top earners' incomes. But hey, they're happy, educated and doing their tax returns must be a snack! Can I claim my obsession with Cirque du Soleil as an 'art grant' on tax?