April 27th, 2022Kyle’s Rant
I DO love this country but my God we pay a lot of tax.
In Australia, our highest PAYE tax bracket is 39 per cent and GST is 10 per cent, so why do we pay so much tax when other countries such as Alaska use alternative sources of revenue that can offset the need to tax residents, revenue like tourism and natural resources.
Alaska generates 90 per cent of its revenue from its oil and gas industry and boasts a zero per cent income tax rate. Oil-rich countries like Oman and Qatar are also in the same boat. Then there are countries like the Bahamas or the Maldives who generate enough revenue from tourism to fund a government without the need for an income tax on residents.
Meanwhile Australia is rich with mining and has proven reserves equivalent to 2.9 times its annual consumption so is able to export oil, gas, iron ore and that horrible contentious black rock. Australia also has a huge international tourism market that, although a little stunted now, is forecast to spring back to full steam by mid-2023. But we still insist on pressuring our residents with a butt-load of tax, in fact, pound for pound one of the biggest butt-loads in the world.
It does make you think/angry when you take time to drill down into the figures what your earnt dollar in Australia is worth after all the little tax piggies take a nibble.
Before you bring that dollar home you pay around 30 per cent, leaving you with 70 cents and don’t forget the drive home. Before they removed some of it, the excise on fuel was around $0.44 cents per litre and then you pay GST on the excise. WTF?
I reckon by the time you have paid PAYG tax, GST, fuel excise, car registration and all the other small taxes that go unnoticed, such as rates, every week you are left with a post-tax take home wage of 25 cents on the dollar that you earn, ouch.
Meanwhile the various levels of government greedily carve up your taxes of which 80 per cent of the initial 75 cents in the dollar they took, is spent on government self-management and due process rather than outcomes.
At least we don’t pay is a death tax but my accountant Matt from Cooke and Foley Ballarat says one of the biggest tax traps is the misconception that your principal place of residence is always tax-free.
If you happen to own a home and have the chance to get some money out of the price boom by subdividing and realising the value of your home the mongrels at the ATO can clip the ticket on the piece you subdivide once sold for capital gains tax.
So, even though you scrimp and save your post-tax take-home wage of 25 cents on the dollar and manage to pay off the biggest investment of your life, your home, subdivide it to feather your nest and of course help the housing crisis, once again the taxman comes calling.
To add insult to tax-sucking injury we now have to toss up who gets to run the swamp up there in Canberra. Both candidates come with a shopping list of idiosyncrasies. In the right corner you have a dude who every time he seems to mention Jenny gets into media trouble, and in the left, a fella who doesn’t seem to be across the numbers. God help us all. 2021/2022 Tax rant over…