medhead
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- Feb 13, 2008
- Posts
- 19,074
Anyone with half a brain who'd watch a couple of episodes on Minder could have told you the black economy would take off. Just that some of use can't avoid GST, whereas others can. e.g. tradies who always get paid in "cartons" and who pay for everything with cash.If I remember correctly, one of the biggest points the Coalition made when wanting to introduce the GST was that it would get rid of, or reduce the 'black' cash economy.
I am pretty sure that I have read reports that under the GST, the opposite has happened and the 'black' cash economy has grown significantly.
In terms of the lower personal income tax, that is very true. income tax is lower. But from my budget research, (bearing in mind this research is a few years old) the tax take is basically unchanged it is just the mix that has changed. The tax take as a percent of GDP ran at about 22%to 25% under Howard, with a GST. Any cut in income tax was more than made up for by the increase in GST collected. IIRC Keating had the tax take as low as 19%/20% of GDP in some years, but typically in the range 21% to 24%. so he was kinda always 1% to 2% behind Costello.
You know I might have to really look into this all again. Maybe my memory is failing and I've got this completely wrong.
Ok I looked it up and my memory is failing:
http://www.budget.gov.au/2009-10/content/bp1/html/bp1_bst10-05.htm
Looking at the Receipts as a percent of GDP during Keating period (83 to 96) the average was 24.45%, Howard continued on at about the same rate until the GST kicked in and then his average jumped to 25.98%. so regardless of how much some taxes fell Costello was collecting about an extra 1.5% of GDP. Just to avoid accusations of basis in my calculations the average for all howard years is 25.7%.
That table has a fair bit of other information but I leave that to anyone who is interested. Also this might sound like a sprited Keating defence, but really i'm more about highlighting the not so trues of Howard and Costello. That doesn't mean I'm not aware of the good things that they did.
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