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Keep socialist blog En Passant going - donate now
If you want to keep a blog that makes the arguments every day against the ravages of capitalism going and keeps alive the flame of democracy and community, make a donation to help cover my costs. And of course keep reading the blog. To donate click here. Keep socialist blog En Passant going. More... (4)

Sprouting sh*t for almost nothing
You can prove my 2 ex-comrades wrong by donating to my blog En Passant at BSB: 062914 Account: 1067 5257, the Commonwealth Bank in Tuggeranong, ACT. More... (12)

My interview Razor Sharp 18 February
Me interviewed by Sharon Firebrace on Razor Sharp on Tuesday 18 February. http://sharonfirebrace.files.wordpress.com/2014/02/18-2-14-john-passant-aust-national-university-g20-meeting-age-of-enttilement-engineers-attack-of-austerity-hardship-on-civilians.mp3 (0)

My interview Razor Sharp 11 February 2014
Me interviewed by Sharon Firebrace on Razor Sharp this morning. The Royal Commission, car industry and age of entitlement get a lot of the coverage. http://sharonfirebrace.com/2014/02/11/john-passant-aust-national-university-canberra-2/ (0)

Razor Sharp 4 February 2014
Me on 4 February 2014 on Razor Sharp with Sharon Firebrace. http://sharonfirebrace.files.wordpress.com/2014/02/4-2-14-john-passant-aust-national-university-canberra-end-of-the-age-of-entitlement-for-the-needy-but-pandering-to-the-lusts-of-the-greedy.mp3 (0)

Time for a House Un-Australian Activities Committee?
Tony Abbott thinks the Australian Broadcasting Corporation is Un-Australian. I am looking forward to his government setting up the House Un-Australian Activities Committee. (1)

Make Gina Rinehart work for her dole
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Sick kids and paying upfront

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Save Medicare

Demonstrate in defence of Medicare at Sydney Town Hall 1 pm Saturday 4 January (0)

Me on Razor Sharp this morning
Me interviewed by Sharon Firebrace this morning for Razor Sharp. It happens every Tuesday. http://sharonfirebrace.com/2013/12/03/john-passant-australian-national-university-8/ (0)

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Here’s just one idea Labor – tax the rich

It all began with me reading one of those delightful stories, in the Australian Financial Review of all places, trying to paint the French as somehow a little odd and quirky.

A rich British magnate has a holiday flat in the ski resort of Val d’Isere.  Sir Lindsay Owen-Jones – you just can’t make these names up – is trying to shut down a chip stand nearby because he doesn’t like the smell, the noise or the sight. (Henry Samuel ‘French spitting chips over pom’s frites court case’ AFR Monday 6 February 2012 page 13. By the way, who is the twisted genius doing their headlines?)

Sir Lindsay visits the resort for a month a year.

Well, hasn’t his claim for loss of value ignited a fervour of ‘class envy’ in France? Valerie Maertens, the chip stand owner, has said the tycoon is acting like a feudal lord wanting to crush the peasants. (Funny, that’s the same sort of description I use for University management and its relationship to its workers. We peasants are revolting.)

Well, the locals have supported the chip stand owner in their thousands upon thousands. maybe the French aren’t so different after all. This looks like  the same revulsion many of us here in Australia feel about Gina Rinehart, the richest Australian, buying a big share in a newspaper.

In among this Financial Review story of class war was a message for the Australian Labor Party. As the report in the AFR says:

The French are notoriously wary of high-earning bosses. Francois Hollande, the Socialist presidential candidate, has seen his popularity rocket ever since pledging to ‘tax the rich’ and declare war on ‘finance’.

Tax the rich eh? Who’d have thunk that would be a vote winner? Bash the banks. Another vote winner.

Why not combine the two, Labor? How about  a super profits tax on the banks to fund all those socially necessary expenditures like a universal dental health care scheme?

Apply it to all companies making a super profit from the stolen land of Aborigines and Torres Strait Islanders and who knows, we might even have enough money to negotiate a real treaty with our Indigenous brothers and sisters.

Here are a few other tax ideas driven by the fact that Australia doesn’t have  a progressive tax system. According to the ACTU, the bottom 20% pay an effective tax rate of 26.7%. The top 20% pay an effective tax rate of 34.5%.

Now remember, the bottom 20% own about 1% of the nation’s wealth; the top 20% own over 60%.

A left wing government would begin by making the income tax scales more progressive, not less as they have been becoming over the last 30 years.

It could impose a wealth tax on the rich, bringing in billions every year from a tax on the wealth they hold here and overseas. 

It could implement a death and gift duty so the sons and daughters of the Rineharts, Packers, Murdochs and Fairfaxes would pay tax on their ill-gotten gains.

It could even impose a minimum company tax on business so that the 50% of big business who currently pay no income tax, and those who reduce their effective rates to well below the current company rate of 30%, pay a little more.

And it could attack the disguised grants to the business and the rich through the tax system known as tax expenditures. The Treasury figures are revealing.

According to the Treasury statistics released a few days ago the superannuation concessions will cost us about $30 bn next year.  According to ACOSS 80% of these tax benefits go to the top 20% of income earners. Those earning below $37000 get no benefit from the concessions.

Disguised grants through the tax system for business (euphemistically called ‘business tax expenditures’) for 2010-11 are in the order of $9 bn. Abolish them and your budget deficit disappears.

And the houses of the rich (along with everyone else’s) are not subject to capital gains tax. Maybe now is the time to tax the gains those who live on the foreshores of Sydney Harbour make on their multi-million dollar houses.

And that’s just a few thoughts from a deranged Lefty, Labor. Imagine what the neoliberals in Treasury could come up with in a  day of thinking about squeezing the rich till their pips squeak. 

Tax the rich? Nah, it would never be popular, would it, Labor? Just ask Francois Hollande, the man who could well be the next President of France precisely because he says he wants to tax the rich.

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Comments

Comment from Ben Rose
Time February 7, 2012 at 10:59 am

Great article John! Totally agree! Sacandinavian countries have had this system for years and it works. Just letting the greediest types plunder the nation is the path to GFC , worse inequality, social instability and unrest. I’m amazed it took as long as it did to arrive at this point. The ehtical rich (e.g Dick Smith and W. Buffet) are telling us the rich must be taxed more! Start with a carbon tax on the multinationals who will be exempt from it.

Comment from Cronus
Time February 7, 2012 at 12:43 pm

One tax lecturer thought nothing of defining income as being what the government can find – upping the rate of tax may look good, but if the income is hidden it means nothing. But who are the rich and greedy? Everyone believes the rich are those earning considerably more than them. FID tax displays a tax mentality that needs to be understood. Create a tax so it is easier to pay than avoid. Flo Bjelke-Petersen was mocked for arguing flat rate tax, but remove the capacity for hiding benefit and 10% of $1,000,000 is more than 10% of $40,000. Add draconian penalties for failure to declare and include all perks as benefits and one can create a situation where it is easier to pay than avoid (always allow an escape route for inadvertent error). As it stands there are more than enough incentives to avoid tax to make it worth those involved their time and effort. Public expenditure is also a synonym for wastage, not conducive to paying tax. Quoting percentage rates is good rhetoric, but designing a system which works is more important.

Comment from Mike C
Time February 7, 2012 at 1:05 pm

For most European’s, a policy of taxing the rich is an easy sell. The French have a proud history of revolution. What of anglophone countries? Why are the masses so easily brainwashed on acceptance of trickle down growth delusions pushed by vested interests?

Even a gentle nod to minor reforms in taxing the wealth of the wealthiest, or removing a lucrative concession seems to need a very clever and full frontal advertising campaign.

Networking with supporters on the ground might just do it, counter-balancing the millions that vested interests will use to flood the air waves to mass audiences about the threat to the 99% – with the lead question – where will it all end? No more billionaires, perish the thought.

Reinhart has proven to be a formidable warrior who will put up large sums to push a media blitz. Her forray into media is strategic and she can count on support from like minded rich list moguls such as Murdock and Stokes with their media empires front men pressing the scare and shock tactics, demonising social justice reformers while preserving or better still, widening further, the growing gap between the haves and have nots. It’s a fight worth having, but we need a smart battle plan and counter insurgency strategy to win here in oz.