Tax  Tigers  are  prowling
Land tax is the most efficient tax, according to leaked South Australian documents, stating that this tax allowed communities to share in wealth from increases in land values. Unfortunately, the documents seem to support unjust taxes such as payroll tax, which bring the States 25% of their tax revenue. The High Court in August 1997 declared State taxes such as those on alcohol, tobacco and fuel to be illegal. The W. A. Treasury has proposed: 15% wealth tax on people earning more than $1 million, 14% W.A. income tax, 12% Value Added Tax (VAT) which approximates a GST, and taxing carbon dioxide emissions from industry.
'IN this world nothing can be said to be certain except death and taxes."
  Benjamin Franklin's cryptic 1789 quotation can with equal certainty be taken a little further, once a government introduces a new tax, that tax is here to stay.
  No matter how the Opposition of the day rails against new taxes, when it attains government it invariably has an excuse to keep them.

57 Contents 

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  Fringe benefits tax and financial institutions duty (FID) caused an outcry when introduced but a change of government has not seen them scrapped.
  It is small wonder the public is suspicious about any new tax.   In 1993, voters showed this when then Liberal leader John Hewson campaigned on a Goods and Services Tax (GST).

  It is history that Dr Hewson lost the unlosable election and Labor's Paul Keating was returned on the back of a GST scare campaign.

  Now the spectre of a GST has raised its head again with taxation reforms on the agenda.

$25,000  TAX   REFORM CHALLENGE
Land Values Research Group
BOX 2688X GPO, Melbourne 3001, Australia
Ph: 03 9670 2754 Fax: 03 9670 3063
Email: lydiak@earthsharing.org.au

Closing 31 March 1998, entry $10, limit 4000 words on A4
See fuller details, including a Summary and the DOCUMENT to be rebutted, on http://home.vicnet.net.au/~earthshr/Challeng.html

and the original version of the Summary put on the Internet by the organisers of the National Tax Reform Summit, on http://impactservices.com.au/acci/submission/pdday.htm
or see our Website's brief Challenge document on http://www.multiline.com.au/~georgist/essay.htm
or our Website's copy from the original Summary only of the document to be rebutted on http://www.multiline.com.au/~georgist/day-phil.htm


  But the passage of time has seen big changes in Dr Hewson's GST.

  His intention was that a 15 per cent GST should replace all taxes, except income tax.

  That means no inequitable wholesale tax, fuel tax, payroll tax or the miscellany of taxes that bedevil business.

  Now discussions about a GST, which appears to have wider public support than in 1993, do not involve plans to replace payroll tax or fuel tax.

  A discussion paper, prepared for the States and leaked in South Australia, flags a GST -- now called a Value Added Tax (VAT) -- but suggests broadening State-based taxes such as payroll and land tax.

  "For as long as land tax and payroll tax remain under-exploited, State claims about Vertical Fiscal Imbalance (VFI) will ring hollow," the bureaucratically-prepared discussion paper says.

44       SUNDAY  TIMES,  OCTOBER  12,  1997
My   View

Janet Wainwright

Republished by THE REFORMERS' CLUB 10 Broome Street, South Perth, Western Australia, 6151.

  For readers not schooled in the language of government treasuries, VFI is the increasing gap between what the States give to Canberra and what they get back.

  The High Court decision in August which made illegal State taxes such as those on alcohol, tobacco and fuel robbed the States of 17 per cent of their tax base.

  But it did accelerate debate on the need for long-overdue tax reform.

  However, in seeking ideas, treasury officials have been unleashed to put together discussion papers which would pose increased taxes rather than streamline and reduce the tax burdern.

  The leaked SA document found land tax, which will yield WA $168 million this year, the most efficient tax.

  It rationalised that this form of wealth tax allowed communities to share in wealth from increases in land values.

  And it found payroll tax, which accounts for 25 per cent of the States' taxation revenue, should be broadened.

[ Top of Document ] [ Foot ]
THE Court Government has been slowly increasing the threshold on which payroll tax is applied.  This means a business with a payroll of less than $675,000 is now exempt.

  Yet this year WA will still increase its receipts from this tax from $682 million to $737 million.

  As well as broadening the base for payroll and land tax, the SA paper wants to implement State VATs, which could be as high as 21 per cent.

  And it wants States to be able to levy income tax.

  Equally controversial, the WA Treasury has proposed a 15 per cent wealth tax on people earning more than $1 million (already ruled out by Premier Richard Court) and a carbon tax -- possibly $80 per tonne -- on carbon dioxide emitted by industries.

  It also proposes a 14 per cent income tax and a 12 per cent VAT, if the Federal Government agrees to relinquish some of its taxing powers to the States.

  Opposition Leader Geoff Gallop supports handing income taxing powers to the State but not a VAT or GST or whatever guise the consumption tax may take.

  Equally important as a referendum on the Constitution, people should get a chance to put their views on taxation changes.

THE END


OBJECTIVES:   Social Justice, Land Rights for All, Collection of Site Revenue and Resource Rentals, Environmental Protection, Sustainable Development, Decentralisation, Opposition to Anti-Enterprise Taxes and Monopolies, Proportional Representation, Responsible Government Expenditure, Exclusive Land Occupation, Collection of Misappropriated "Economic Rent," Natural Public Revenue, Abolition of Involuntary Unemployment, Wealth Producers to keep Full Value of their Production and Enterprise, Reducing Speculation, Freedom, Civil Liberties, Human Rights.

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