Tax increases by Stealth
We might have thought that the worst of the inequity of the Abbott government’s 2014 budget was stymied. Not so! They have continued their upper-class war against the poor by stealth, with the support of Labour Opposition, who seem to be more and more betraying their labour ideals, through a number of revisions of the tax system.
A man on a relatively low income goes to his tax agent expecting about $2900 in a tax refund. This year he gets no refund. Why? The dependent spouse and the seniors rebate have been abolished from 1st of July 2014. On top of this there has been a number of revisions to Medicare. If my calculations are right, and at the moment they are provisional, the person on $50,000 taxable income per year loses a deduction through the loss of the dependent spouse rebate of around $1600. This loss is that the person is higher tax rate of 32.5% of which only around $13,000 is at this rate.
When you consider the Government’s refusal to tackle the inequity of superannuation and the advantage that this gives to people who earn more, together with the advantage that people on a higher tax rate get for their tax deductions, the inequity is barely comprehensible.
It his thoughtful article ‘Democracy is losing the plot, to our peril’ (The Age 6/8/15*), Chris Zappone suggests that in the current global context, democracy has lost its narrative and two of the great champions of democracy, the United States and Australia are becoming less egalitarian.
“In the US, wages were stagnant for decades, as the rich got richer. In Australia it’s another variation: wages rose but home prices have risen ever faster, driving a stake through the heart of the egalitarianism Australia was once famous for”.
This means that together with the secularisation of society many Western countries are neither egalitarian in theory or practice. Capitalism has destoyed the ethos of service of many of the professions and replaced it with the greed of profit.
The revisions of the tax system are yet another example of our loss of the egalitarian ideal both in narrative and practice.
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