Dose

The Budget

111 posts in this topic

 

You are not entitled to do the same with your wage or salary

 

 

 

I think more and more people are going to find out how easy this is to do (the tax reduction thing). If I was a 20 something I would see the changes being posted on forums by people like myself and go to my boss and say "hey if I go contract you save money, I save tax, it's a win win thing yeah" Granted currently it is expensive ish (upfront costs) but highly rewarding (without even being dodgy like the real corporates do with the multi nation switches). The only reasons I can see for any person wishing to stay in their country (people going ex pat obviously are have to be in a really weird scenario to not do it) to not do it is if

  • they can't convince their boss the savings in payroll tax, workers comp, etc are not worth it (that will only last til the first person does it)
  • they are in debt (and so all money comes back to service the debt which makes the upfront costs pointless)

Then any government choosing to treat their citizens as capital will have to rethink. They won't of course as they truly seem to believe that they are honest and doing their best for the country generally. As the stone starts rolling it will, I think, become a massively powerful force for democracy. I have no real feelings about government being too big or too small (I think point 6 is a good idea, breeders should be encouraged, I think it should be at a huge cost to government, that would encourage lots of breeding, I'm not going to because I don't need the cash but if anyone wants the status quo to continue it is obvious the country needs a pyramid base, plus I am generally well disposed towards parents spending time with their kids, less crime that way I figure).

 

If you were an average wage American would you vote in a single matter poll for more wars which would impoverish you or take your chances with terrrrrrrrrrists? I'd be pissed if the girlfriend got killed in a terrrrror thing but more kiddies of poor people have died in the wars than the terrrrs achieved and now vast numbers of my US'ian friends who were comfortably middle class are unemployed / divorcing etc. Could be coincidence of course but I doubt it.

 

Given how fast Uber, AirBNB etc have taken place in the states I think there is a trend towards the understandable "get more money" and "save more money" trend.

 

Once people realise that it is pretty damn simple to say "Nope, I don't give a toss about the invasion of refugees or the shiny new stealth fighter, I want a government that just makes the sh*t I want to work work" and go hands free it will become a massive groundswell and countries doing daft stuff like Singapore or Norway will become the coolest places in the world to give your taxes to.

 

Think of it this way: I have paid lots of tax to the australian government over the years, they expect it to keep coming and base their budget on that (not just mine obviously). I don't vote because I can't say what I think is important. My tax to the australian government goes to close to zero in about 8 weeks. My accountant indicates there are a few people asking for how I did it and so on. My singapore accountant told me I am lucky to have started early as she is swamped with incoming requests.

 

Australians are not Americans; Americans threaten to leave but don't (they are one  of two? countries that don't allow "not resident for tax purposes"). Australians apparently do.

 

Looks like a good day for democracy to me.

 

Now of course to remind the singaporean government exactly why we choose them, it sure as hell wasn't their human rights. I may not vote in a booth but I vote with money and I think they might want to get their sh*t together on that.

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During an appearance on the ABC's Q&A program last night, Mr Hockey told the audience he was now looking at areas such as superannuation to better prepare Australians for the change.

Mr Hockey told host Tony Jones that the Government would have "more to say about retirement incomes further down the track".

"In this term?" Jones asked.

"Well, I suspect it will be in this term," Mr Hockey replied.

http://www.abc.net.au/news/2014-05-20/hockey-flags-changes-to-superannuation-before-next-election/5463618

 

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It does seem absurd that on the one hand the government increases the age before you can get the pension but not the age when you can get a hold of your super. I also don't see why your super balance is not available as only in the form of an annuity. The current system encourages people to take their super as a lump sum, p1ss it up in holidays and buying expensive trinkets, then go on the government pension when they've got nothing left!  :wacko:

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I forgot to mention that Hockey stated that a (political) party does not have to lie to get into power!!  :lol:

 

link

Edited by cobran20

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It does seem absurd that on the one hand the government increases the age before you can get the pension but not the age when you can get a hold of your super. I also don't see why your super balance is not available as only in the form of an annuity. The current system encourages people to take their super as a lump sum, p1ss it up in holidays and buying expensive trinkets, then go on the government pension when they've got nothing left!  :wacko:

It does seem odd that the preservation age hasn't been raised. 

 

I'm in two minds about annuity only. There cases where a lump sum is justified IMO. Perhaps things like expensive unexpected maintenance of a house or medical expenses. Maybe just some restrictions on lump sum. 

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It does seem odd that the preservation age hasn't been raised. 

 

I'm in two minds about annuity only. There cases where a lump sum is justified IMO. Perhaps things like expensive unexpected maintenance of a house or medical expenses. Maybe just some restrictions on lump sum. 

 

you have to be careful with exceptions - once you introduce one, there will be a queue of other 'valid' exceptions. The only exception should be if you're terminally ill where (like many life insurances) you get a payout in advance to help pay for the (palliative care) bills.

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you have to be careful with exceptions - once you introduce one, there will be a queue of other 'valid' exceptions. The only exception should be if you're terminally ill where (like many life insurances) you get a payout in advance to help pay for the (palliative care) bills.

 

you have to be careful with exceptions - once you introduce one, there will be a queue of other 'valid' exceptions. The only exception should be if you're terminally ill where (like many life insurances) you get a payout in advance to help pay for the (palliative care) bills.

Your post seems so important that SS has decided to double up! How can I argue with that?

 

It's hard to define what would be a fair and equitable reason for a lump sum, so perhaps an upper limit(%?) to draw down PA? 

 

What's odd in the current system is that there is a min draw down of super, 3-14% of the balance. https://www.ato.gov.au/Rates/Key-superannuation-rates-and-thresholds/?page=8

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I was thinking...

 

You could say something like, "Ok, you want your super funds before 65? (pension age) Ok, but no pension for you until 75-80." (close to life expectancy) That way people can get access to their own savings when they want but they can't piss it all away just in time for the government pension to kick in.

 

Benefit to retiree - instant access to super funds, greater self-determination.

Benefit to government - (potentially) 10-15 years less paying out a pension.

 

If a pensioner pisses away their savings then it was their own decision to live in poverty. The major chink in this is if there are significant medical costs which eat up a lot of savings... though I am sure there are others.

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I was thinking...

 

You could say something like, "Ok, you want your super funds before 65? (pension age) Ok, but no pension for you until 75-80." (close to life expectancy) That way people can get access to their own savings when they want but they can't piss it all away just in time for the government pension to kick in.

 

Benefit to retiree - instant access to super funds, greater self-determination.

Benefit to government - (potentially) 10-15 years less paying out a pension.

 

If a pensioner pisses away their savings then it was their own decision to live in poverty. The major chink in this is if there are significant medical costs which eat up a lot of savings... though I am sure there are others.

 

Disagree. Those that p1ss it away early will only place a burden on charities like the Salvos and then the loony left will cry that we're not looking after our less well off, resulting in social welfare being offered to those who blew their super.

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Disagree. Those that p1ss it away early will only place a burden on charities like the Salvos and then the loony left will cry that we're not looking after our less well off, resulting in social welfare being offered to those who blew their super.

That may be true, but the government could point the finger at those who 'piss away their savings'. If enough people agreed "oh look that those irresponsible oldies, well they only have themselves to blame" then it may be viable.

 

Mass psychology can be weird especially when influenced by effective propaganda. For example, one time a Russian friend was telling me about Russian psychology. I was told they (Russians) like to cause suffering (i.e., burn someone's house down due to envy) and then console and support the victim. It's not rational but the way people think.

 

Another example is the at times bizarre demonisation of refugees (boat people) while immigration is running at record levels. It's ok for corrupt rich Chinese to migrate here but not ok for poor people fleeing from war-torn places.

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All Canberra has been abuzz with doom and tales of narrowly averted disaster since the budget. One can't enter a food mall without overhearing talk of why a public servant in a position shouldn't be left alone as opposed to the lazy, feckless bastard in the next cubicle. Fascinating! ^_^

 

It's not like some of the other budget issues where there is condemnation like the end of universal health care or higher education enslaving the young in debt before they even get the chance to enslave themselves in property (proper) debt. No-one is defending the mass sacking of the APS. 

 

I'd volunteer for a package me self except that these packages are way over subscribed and all the surplus are doing is adding themselves to a future hit list of employees unhappy working for the dept.  :unsure: 

 

Luckily for me, I can barely contain my enthusiasm for the work I undertake in my current department...

 

All hail Lord Protector Abbott!

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I read in today's paper (can't find on-line) some more detail about the scrapping of FHSAs in the budget for existing account holders...

 

From 1 July 2014 govt contributions stop.

From 1 July 2015 the account will be treating like any other bank account. Tax concessions will stop and the balance can be withdrawn and spent however you like. 

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I read in today's paper (can't find on-line) some more detail about the scrapping of FHSAs in the budget for existing account holders...

 

From 1 July 2014 govt contributions stop.

From 1 July 2015 the account will be treating like any other bank account. Tax concessions will stop and the balance can be withdrawn and spent however you like. 

 

ATO

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I read in today's paper (can't find on-line) some more detail about the scrapping of FHSAs in the budget for existing account holders...

 

From 1 July 2014 govt contributions stop.

From 1 July 2015 the account will be treating like any other bank account. Tax concessions will stop and the balance can be withdrawn and spent however you like. 

 

 

So to maximise the last ever year on an existing FHSA one should plonk in at least 6k (to get the max 1k govt contribution) before June 30 and up to 90K maximum balance to maximise the benefit of 15% tax for the financial year up to 2015? 

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So to maximise the last ever year on an existing FHSA one should plonk in at least 6k (to get the max 1k govt contribution) before June 30 and up to 90K maximum balance to maximise the benefit of 15% tax for the financial year up to 2015? 

I guess so.

 

There is the tiny tiny risk that it won't get through parliament and you end up with money locked away that you thought you could spend on coke and hookers after July 2015.

 

I can't see it getting blocked however - perhaps delayed. If it get's delayed till the new senate then there's the possibility that the govt contribution might have to be paid till it's passed. So in your scenario I'd chuck in $6k now and $6k in early July. 

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I guess so.

 

There is the tiny tiny risk that it won't get through parliament and you end up with money locked away that you thought you could spend on coke and hookers after July 2015.

 

I can't see it getting blocked however - perhaps delayed. If it get's delayed till the new senate then there's the possibility that the govt contribution might have to be paid till it's passed. So in your scenario I'd chuck in $6k now and $6k in early July. 

 

Thanks zaph. I hadn't considered that this measure would be rejected by Labor. It wasn't terribly successful in the first instance so I don't imagine Labor are so attached to the policy to prevent it's abolition. Banks aren't offering any new FHSA accounts. However, I will actually be using the money as a deposit so I might pop some more in just in case.  :)

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Hockey has pulled the stimulus lever in spite of his rhetoric. Does anyone think it will work? It's the 20K handout to business that mirrors the $900 Rudd handout to everybody. IR @ 2% means there is trouble on the horizon. Anyone keen to go further into hock? 

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Thanks zaph. I hadn't considered that this measure would be rejected by Labor. It wasn't terribly successful in the first instance so I don't imagine Labor are so attached to the policy to prevent it's abolition. Banks aren't offering any new FHSA accounts. However, I will actually be using the money as a deposit so I might pop some more in just in case.  :)

Did you end up tipping some in? What's the status of the FHSAs, I haven't been following it?

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FHSA's are defunct. However I have tipped 90K into our existing FHSA to maximise the government co-contribution. Alas, this is the last year that this can be done. 

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Hockey has pulled the stimulus lever in spite of his rhetoric. Does anyone think it will work? It's the 20K handout to business that mirrors the $900 Rudd handout to everybody. IR @ 2% means there is trouble on the horizon. Anyone keen to go further into hock? 

About time. The contractory budget of last year was not suited to economic conditions.

 

It's quite different to the Rudd handout. The Rudd handout mostly just created wash in the economy. This will create wash as well other things.

1. It's not a handout, it allows a capital expense for small/medium business to be immediately deductible, rather than deductible over a number of years - typically around 5. So it's not a direct cost to the govt, just they will be receiving less revenue now and more over the next few years depending on how the scheme distorts business capital spending. 

2. It will pull forward demand. For a lot it will just mean buying a computer/car/lawnmower/whatever this year rather than in the next few years.

3. I suspect it will create a fair amount of - the govts giving out free money - quick go out buy something, anything. Talk in the media and the net reflect this theory. 'How do I get my hands on this free money' seems to be common talk.

4. It will increase productivity, which could be good or bad for employment - but will certainly be good for the business owner. A. I replace my secretary's 386 computer and now need her 5 hrs a week less because the pc is faster. I replace one of my clapped out utes, so I can now reduce my workers time that they sit on the side of the road waiting for the RACQ. B. With my new ute and lawnmower I can hire another worker and expand my business.

5. This scheme is available for three financial years and $20k per item, not per business. 

6. Oh damn there was a six but I've had eight bottles of wine and forgetten what it was'n

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FHSA's are defunct. However I have tipped 90K into our existing FHSA to maximise the government co-contribution. Alas, this is the last year that this can be done. 

Ok. So did it work out as planned by the libs? Can you now just spend the balance on blow and blow jobs?

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About time. The contractory budget of last year was not suited to economic conditions.

 

It's quite different to the Rudd handout. The Rudd handout mostly just created wash in the economy. This will create wash as well other things.

1. It's not a handout, it allows a capital expense for small/medium business to be immediately deductible, rather than deductible over a number of years - typically around 5. So it's not a direct cost to the govt, just they will be receiving less revenue now and more over the next few years depending on how the scheme distorts business capital spending. 

2. It will pull forward demand. For a lot it will just mean buying a computer/car/lawnmower/whatever this year rather than in the next few years.

3. I suspect it will create a fair amount of - the govts giving out free money - quick go out buy something, anything. Talk in the media and the net reflect this theory. 'How do I get my hands on this free money' seems to be common talk.

4. It will increase productivity, which could be good or bad for employment - but will certainly be good for the business owner. A. I replace my secretary's 386 computer and now need her 5 hrs a week less because the pc is faster. I replace one of my clapped out utes, so I can now reduce my workers time that they sit on the side of the road waiting for the RACQ. B. With my new ute and lawnmower I can hire another worker and expand my business.

5. This scheme is available for three financial years and $20k per item, not per business. 

6. Oh damn there was a six but I've had eight bottles of wine and forgetten what it was'n

 

The libs have received a bounce for apparent largesse. The 100% deduction was always available over the longer time frame. They've simply pulled demand forward as your point 2 asserts. Coincidentally, it ends just after the next scheduled election.

 

It will be rorted as much as is possible. But not as much perhaps as those without a basic grasp of economics suspect. The rorters need to have the cash flow and pay enough tax to benefit. The tax office threats are impotent. They have just sacked a bunch of watchers so their ability to enforce law is reduced.

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