Oz Federal Election 2013 - Discussion and Comments

[eastwest101]

The last I checked, ALP had (thankfully, rightly) given up their pie in the sky dream of attaining surplus this year.

Yes they gave up the promises that they dogmatically made from 2009 to now, and apparently delivered if you believe the recent pamphlets that were published by the member for Lilley.

And its Joe and the Liberals, and not the Government, that have been beating their chests about attaining a surplus each and every year; without realising that Hockey is no Costello, and Howard hasn't left much in the coffers to sell.

We will only see Hockey's actual defecits/surplus if the coalition wins an election in September 2013 - even then, they will be affected by previous governments performance and defecits/surplus.

I've never quite understood the obsession people have with the Government achieving surplus, and then comparing the balancing of Government Budget to balancing ones personal finances.

I don't know - I am no economist either, but I suspect it has something to do with government defecits being funded by borrowing which then means that the government is paying it back with interest. This money is then unable to be used to provide government services etc.

Thankfully, it hasn't reached the proportions seen in the states yet, despite sections of the Liberal Party taking on a distinctly Tea Party like flavour.

Its actually really interesting to read up on the original Tea Party stuff in 1774.

It's The Australian that is apparently raising that issue of additional taxation on superannuation and the class warfare stemming from it.

If you are invoking a News Ltd conspiracy then how come the ABC and the Association of Superannuation Funds of Australia are discussing it?

http://www.abc.net.au/news/2013-02-08/industry-warns-govt-off-superannuation-taxes/4508610

Hard decisions are going to be made, and no party will please everyone. Despite being in a bracket that will benefit from Abbott's tax cuts and rebates, I can't find myself agreeing to what his "vision" is for this country, and as if it came down to a dichotomy between ALP's "proposed" increased tax on Super Balances beyond a certain threshold against Abbotts reduction or abolishment of Superannuation related tax concessions for those at the lower end of the income spectrum, I know where I stand.

I agree with you - hard decisions will have to be made. in the future I would prefer a root and branch look at the entire state and federal tax and welfare system rather than piecemeal fiddling around the edges with targeting tax hikes for people unlikely to vote for you and tax breaks for your own constituents - that's a recepie for division, chaos and lack of investment in our economy and society.

 

[medhead]

Did you read the article?

Here's another Cookies must be enabled. | The Australian

This is not a swipe at ALP or Libs/Nats. It's a comment on all of them.

My comment was about all as well. The defined benefit scheme has closed. No new members can join. The rort has ended, no more Bill O'Chee's or whoever.

My issue is you seem to be suggesting that the remaining members should be kicked off the scheme. That there employment conditions should be significant varied. I cannot agree with that, because, rightly or wrongly, that was/is their super scheme and they are entitled to the benefits if they have properly participated. To retrospectively take that away because we now say it's too generous means my employer could do the same to me or you.

 

[medhead]

So you accept that "Despite being sold as such, carbon Tax had almost nothing to do with increasing the tax free threshold to $18K." No argument from me - but perhaps you had better tell the Assistant Treasurer that, as claimed by him on a Sky News interview this morning:

"Joe Hockey's plans - if you unwind the mining tax, you unwind the carbon price - is to unwind the tripling of the tax free threshold," Mr Bradbury told Sky News

What Bradbury clearly understands is that the tax free threshold was increased in the carbon tax legislation. Repeal the carbon tax legislation you repeal the increase in threshold. An opposition that uses simple phases like axe the tax without bothering to explain (or demonstrate knowledge of) the full consequences.

The last time I checked, the ALP are the ones whom have been in government since 2007 and it is incumbent on the Treasurer to announce policies that will ensure their expenditure is less than their revenue otherwise they will go further into defecit.

This is on the wrong paradigm. The government is dead. What they say or do is irrelevant. Their policies are irrelevant because they will never happen. What we must have is a full outline of the alternative. That means the coalition really must articulate their vision if they want an informed electorate. But perhaps they don't want us informed incase we decide we don't want their vision afterall. In which case they would stay silent. That is why the pressure is on them. We're not buying what the ALP is selling and we don't know what the coalition is offering.

 

[amaroo]

My comment was about all as well. The defined benefit scheme has closed. No new members can join. The rort has ended, no more Bill O'Chee's or whoever.

My issue is you seem to be suggesting that the remaining members should be kicked off the scheme. That there employment conditions should be significant varied. I cannot agree with that, because, rightly or wrongly, that was/is their super scheme and they are entitled to the benefits if they have properly participated. To retrospectively take that away because we now say it's too generous means my employer could do the same to me or you.

Not kicked off the scheme - just the rate of tax to be changed. Tax changes occur all the time.

Conditions of employment change all the time.....nothing retrospect about it.

Can't see any dramas......it's just swallowing the same pill they force everyone else to swallow....plus - it's a promise that JG made when she announced the changes. IMHO she deserves full marks for making the undertaking to do it.

 

[medhead]

Not kicked off the scheme - just the rate of tax to be changed. Tax changes occur all the time.

Conditions of employment change all the time.....nothing retrospect about it.

Can't see any dramas......it's just swallowing the same pill they force everyone else to swallow....plus - it's a promise that JG made when she announced the changes. IMHO she deserves full marks for making the undertaking to do it.

Kicking them off would be retrospective. I thought that was your suggestion. My mistake.

I don't care about the tax rates. I'd rather see them have to wait until legal retirement age like the rest of us. Hence my Bill O'Chee comment.

 

[amaroo]

I don't care about the tax rates.

I'm sure they do!

From the article posted earlier.......

SENIOR politicians and judges remain immune from paying an increase in superannuation contributions tax, - despite federal government claims the rise would hit all high-income earners.

The loophole has allowed Prime Minister Julia Gillard to avoid paying $151,000 in annual tax on her generous post-career pension, while also gifting Treasurer Wayne Swan and Opposition Leader Tony Abbott $80,000 and $70,000 respectively.
In its budget last year the government announced it would double the amount of tax on superannuation contributions from Australians who earn more than $300,000, taking the tax from 15 per cent to 30 per cent.
But amid claims of double standards, federal politicians who were voted in before changes to the pension scheme were enacted in 2004 are not required to pay the tax on their defined benefit scheme - their for-life pensions - because they weren't deemed to be contributions.

 

[Pukka]

A good comment I saw today was that we have a great choice in September between-
1/A government that wants to buy your vote and fund it by raising taxes on their enemies or
2/An opposition that wants to buy your vote and fundit by raising taxes on their enemies.

I'll go for the latter thanks

 

[Pukka]

I think it would have to be $1 million per beneficiary. I've also heard a couple of options a) increase the tax on fund earnings, or increase tax on contributions. Or both I guess.

Option a) would seem most applicable if they are talking about value of fund as a criterion. You could have low income earners with large balances and vice versa. I really don't see any benefit in changing investment strategy in this case, well unless you are going to get the earnings down to zero. Zero earnings would defeat the whole purpose of savings.

Option b) I guess you might want to decrease your contributions to the fund. But I would have thought an income trigger would be more appropriate, as per above reason. Still if they increase the contributions tax to 30% and you're paying 40%+ income tax you'd probably still be ahead with super contributions.

I can understand that if you're 55+ but really if you're 40 is it fair to tax it at 30% against say 43% and lock it up until you're 60 !! I don't think so, there is no real benefit at all

 

[drron]

I can understand that if you're 55+ but really if you're 40 is it fair to tax it at 30% against say 43% and lock it up until you're 60 !! I don't think so, there is no real benefit at all

Then there is this-
Australia's super system not so super compared to others: Research

 

[Pukka]

I'm sure they do!

From the article posted earlier.......

SENIOR politicians and judges remain immune from paying an increase in superannuation contributions tax, - despite federal government claims the rise would hit all high-income earners.

The loophole has allowed Prime Minister Julia Gillard to avoid paying $151,000 in annual tax on her generous post-career pension, while also gifting Treasurer Wayne Swan and Opposition Leader Tony Abbott $80,000 and $70,000 respectively.
In its budget last year the government announced it would double the amount of tax on superannuation contributions from Australians who earn more than $300,000, taking the tax from 15 per cent to 30 per cent.
But amid claims of double standards, federal politicians who were voted in before changes to the pension scheme were enacted in 2004 are not required to pay the tax on their defined benefit scheme - their for-life pensions - because they weren't deemed to be contributions.

I don't want to be unreasonable but really I would be happy to burn them all at the stake. Talk about one rule for them and one rule for everyone else

 

[Pukka]

Then there is this-
Australia's super system not so super compared to others: Research

Yeah I read that if only I'd earned as much in England as I do out here!! Still if still rather be here and be screwed by Gillard than be in England. England is broken.

 

[Sprucegoose]

Yeah I read that if only I'd earned as much in England as I do out here!! Still if still rather be here and be screwed by Gillard than be in England. England is broken.

yes the devil you know!

 

[medhead]

I'm sure they do!

From the article posted earlier.......

SENIOR politicians and judges remain immune from paying an increase in superannuation contributions tax, - despite federal government claims the rise would hit all high-income earners.

The loophole has allowed Prime Minister Julia Gillard to avoid paying $151,000 in annual tax on her generous post-career pension, while also gifting Treasurer Wayne Swan and Opposition Leader Tony Abbott $80,000 and $70,000 respectively.
In its budget last year the government announced it would double the amount of tax on superannuation contributions from Australians who earn more than $300,000, taking the tax from 15 per cent to 30 per cent.
But amid claims of double standards, federal politicians who were voted in before changes to the pension scheme were enacted in 2004 are not required to pay the tax on their defined benefit scheme - their for-life pensions - because they weren't deemed to be contributions.

As I said, the defined benefit scheme is in the past. The "contributions" have been made already. You can't tax them again retrospectively. So they haven't avoided anything. I'm also not sure what the situation is for them post 2007, did they have to open accumulation super accounts? If they did all contributions into those accounts would be subject to the applicable tax rate.

But anyway, contributions tax does not apply to withdrawals. However, were they should be taxed is on withdrawals before the age of 60. (even if I think they should have to wait until 60.

 

[medhead]

I can understand that if you're 55+ but really if you're 40 is it fair to tax it at 30% against say 43% and lock it up until you're 60 !! I don't think so, there is no real benefit at all

Well that's the choice we all have to make. Of course, super is a long term system really. The thing that frustrates me is that they have practically removed the ability to make larger extra contributions once your 50 or 55+, so no more $100K top ups later in life when I can afford it. Which means I really should be putting in extra now to compensate for that, but I can't afford it and paying the mortgage is going to give much greater returns. I don't think the system is broke, but there are significant limitations.

 

[amaroo]

As I said, the defined benefit scheme is in the past. The "contributions" have been made already. You can't tax them again retrospectively. So they haven't avoided anything. I'm also not sure what the situation is for them post 2007, did they have to open accumulation super accounts? If they did all contributions into those accounts would be subject to the applicable tax rate.

But anyway, contributions tax does not apply to withdrawals. However, were they should be taxed is on withdrawals before the age of 60. (even if I think they should have to wait until 60.

Hmmmmm, is has nothing to do with the past. Current FY & beyond is the deal.

They need to eat the same s*#* sandwich they serve to the rest of us.

 

[medhead]

Hmmmmm, is has nothing to do with the past. Current FY & beyond is the deal.

They need to eat the same s*#* sandwich they serve to the rest of us.

It's a spurious argument as per what you quoted. Defined benefit schemes are different, they work different and I really can't see how it's possible to apply accumulation account principles to them. If there is no contribution how can you charge a contributions tax. There is also the fact that they don't get traditional investment earnings - The benefit id defined regardless of whether the fund makes 5% a year of 20% - Assuming that the scheme is fully funded.

As I said the real rort is not the lack of taxation. It is the eligibility period to collect the pension before normal retirement age. They get paid X% of their final salary once they leave parliament. So in the case of Senator O'Chee he left parliament about age about 35. He was a senate whip when he left. I have no idea what they get paid, but lets say $100000. So he might get 75% of that per year for the rest of his life. 75000 a year for 20 years until he gets to 55, the age at which the rest of us can get our super. That's $1.5 million for just one senator.

So again I really do not care about the lost contributions tax, it pales into insignificance against that lack of an age limit.

BTW I'm not singling out Mr O'Chee. Just he's the only example I can think of, I'm sure there are plenty of other examples.

 

[Skyring]

BTW I'm not singling out Mr O'Chee. Just he's the only example I can think of, I'm sure there are plenty of other examples.

Natasha Stott-Despoja springs to mind, though she had a longer career and is now well into her sixth decade.

 

[Hvr]

Natasha Stott-Despoja springs to mind, though she had a longer career and is now well into her sixth decade.

Actually she is 43 according to Wiki.

 

[Skyring]

Actually she is 43 according to Wiki.

She was born in 1969, so the Sixties were her first decade...

 

[Deleted member]

Then there is this-
Australia's super system not so super compared to others: Research

The problem with this article is that it doesn't tell you a lot. Contribution caps are actually higher than stated. Because there are concessional caps and non concessional caps. But it does make interesting points on how it compares to the rest of the world.
It is fair to say that even before compulsory super , successive governments have constantly stuffed around with it. I seem to recall that in one year in the 80's there were over 50 major and minor changes.

I really think super is a bit of a soft target , if you compel someone to do something ( which they may prefer not to be doing) it is incumbent upon you to at least provide some benefit they would not have were they to do Something different.
The tax free retirement income is a case in point.
That Maybe was a bit generous, so maybe a flat tax of say 5-10% would have been better.
In any event super does have some major attractions over the alternative . But as soon as the tax payer funded defined benefit schemes for public servants and politicians is brought into line with what the rest of us have to have , the better