Thread: Expenditure Tax.... the Gamechanger?

Originally Posted by BMKal

Ricardo Bosi is a scamming con-man who probably should be locked up somewhere. The Australia One Party is a collection of gullible fools that he had sucked in - many of whom still haven't caught on that he has scammed them for some money and that the "party" they contributed to and were stupid enough to believe in is not even registered with the Australian Electoral Commission.

As for a "spending tax" - it was proposed many years ago by Joh Bjelke Petersen and was at the time called a "consumption tax".
The proposal was to tax ALL income at a flat rate (I think it was 25% from memory), and then to apply varying levels of "consumption tax" to spending, with different rates for life's essentials / luxury items etc. "Income" included ALL income, both personal and company, so would have been a much higher number than what is raised via today's "income tax" as all companies with an income gained in Australia would have paid 25% (or whatever the figure was) of that income in taxation.

The proposal didn't really go anywhere, as Joh was considered a bit of a nutter throughout Australia (except for in Queensland, where "politicians" like Joh, Russ Hinze, Bob Katter, Pauline Hanson, Clive Palmer and others are all part of the furniture). However, the original proposal for the "GST" was loosely based on this "consumption tax" idea, but was bastardized even before it was introduced and became just another tax on top of those we were already paying.

Not quite - GST actually replaced a number of taxes, most notably wholesale sales tax (which varied widely according to what the item was and bizarrely according to what it was intended to be used for), and motor vehicle tax. It was supposed to replace a number of state taxes, but the follow through of this by states has been markedly incomplete.

Originally Posted by 3toes

There is an economic theory that no government has ever actually needed tax income to operate. This is based on the reserve bank or whatever alternative exists. The government sets these up and then puts in their constitution that they have an account with an unlimited overdraft. The reserve bank does not have the right to refuse to write any cheque the government asks for.

Taxation is to control the economy giving favour and making some activities less attractive due to the added cost of tax. It should also cover the cost of collecting the taxes. Under this theory Taxation has nothing to do with repaying the national debt it is about managing economic activity

If there was something in that it would be more than a Theory by now…

This theory has been around for a long long time. There are people pushing variations of it at the moment to support their view of why countries can spend spend spend with no repercussions in the longer term. Think those who say the government budget is not like a household budget and so does not need to be balanced. Of course we now ask what does balanced actually mean

The beauty of economics is that there are no wrong answers just badly justified ones. You can find a theory to justify almost any economic policy you want

Originally Posted by 3toes

The beauty of economics is that there are no wrong answers just badly justified ones. You can find a theory to justify almost any economic policy you want

'Spending money on things that aren't really a necessity' would be a good theory topic.

Originally Posted by JDNSW

Not quite - GST actually replaced a number of taxes, most notably wholesale sales tax (which varied widely according to what the item was and bizarrely according to what it was intended to be used for), and motor vehicle tax. It was supposed to replace a number of state taxes, but the follow through of this by states has been markedly incomplete.

The big difference, was the GST was added to labour costs.

Originally Posted by Saitch

'Spending money on things that aren't really a necessity'

Something my sons are experts at