Showing posts with label fair go. Show all posts
Showing posts with label fair go. Show all posts

Monday, 31 July 2017

Why doesn't the Turnbull Government do more to address domestic tax avoidance?


So why is it that the Turnbull Coalition Government, home to more than one millionaire, continues to allow a set of taxation rules which favour those with both wealth and high incomes over those with only average to low incomes and little to no wealth?


According to the Australian Taxation Office (ATO) – now underfunded, undermanned and demoralised – there is an issue with trusts being used for tax avoidance:

We focus on differences between distributable income of a trust and its net [taxable] income which provides opportunities for those receiving the economic benefit of trust distributions to avoid paying tax on them.

In other words; discretionary trusts are used by high-income earners to distribute investment income to beneficiaries on lower marginal tax rates, in the process reducing the overall amount of tax paid and current rules allow income to be diverted to other family members, such as stay-at-home mothers or fathers, or to dependents over the age of 18, such as children at university, college or Tafe.

Australian Finance Minister and Liberal Senator for Western Australia Mathias Cormann characterises proposals to alter taxation rates on trusts to minimise their use as tax avoidance vehicles as a “tax grab”. Well he would wouldn’t he, with so many political mates to defend.

As for collecting existing tax liabilities……

The ability to enforce payment obligations and pursue avoidance schemes has diminished since 2014 when first the Abbott Coalition Government and then later the Turnbull Coalition Government cut ATO staffing numbers.

The Community and Public Sector Union clearly told the Treasurer in 2017 that:

While the public is supportive of tackling corporate tax avoidance to raise revenue for public services, there are limits to what the ATO is able to do due to significant under resourcing. Despite a growing population and increased expectations from the community, ATO ongoing staffing levels have declined. Between 2013-14 and 2015-16, Average Staffing Levels at the ATO fell by over 4,000 or by nearly a quarter. The audit team, responsible for enforcing the tax compliance of individuals and multinational companies, was hit particularly hard by these job cuts. While there was an increase in the 2016-17 Budget, it has not reversed the significant cuts experienced over the last few years.

Given the need for more, not less revenue, these previous cuts seem illogical. According to information provided to Senate Estimates by senior ATO staff, the return on investment over the last decade would be between 1:1 and 6:1, or simply put every dollar invested in ATO staff generates between $1 and $6 in revenue.[1] Some had previously estimated that the cuts could lead to a loss of nearly $1 billion in revenue.[2]

This disconnect between public expectations that tax avoidance should be tackled and what the ATO can actually do must be addressed by the Government. It should commit to an increase in base funding and staffing for the ATO if it is serious about tackling corporate tax avoidance and increasing revenue.

It seems that while the Turnbull Government talks about an ideal egalitarian society where inequality no longer exists, behind the scenes it is nobbling one of the mechanism’s available to government to ensure that there is a level playing field for all those with only earned incomes as well as those with earned incomes plus accumulated wealth.                                      
So when Turnbull & Co announced in May this year that it intends introducing a strong Diverted Profits Tax and establishing a Tax Avoidance Taskforce in the Australian Taxation Office (ATO) one has to wonder if current staffing levels allow full investigation of multinationals operating in Australia or whether the taskforce (which has in fact existed since 2016) will be adequately resourced to look into multinational tax avoidance and the black economy as mooted.

One also has to wonder why in the face of widespread use of negative gearing of investment properties and capital gains tax arrangements to avoid paying an appropriate tax rate, the Turnbull Government also fails to reform the taxation system in these areas.

Oh, I forgot……………



NOTE

1. Table 1: 45th Parliament of the Commonwealth of Australia party representation

Source: Australian Electoral Commission (AEC), ‘2016 Federal Election Tally Room’

Friday, 21 July 2017

A reminder to rural and regional businesses that there always needs to be a valid reason based on fact for dismissing staff


FAIR WORK COMMISSION
Excerpts, 14 July 20017

[42] In dealing with unfair dismissal claims over the past 20 years a handful of cases remain memorable because of their particular circumstances. In some instances, the case was remarkable because of the manifest absence of valid reason for dismissal, usually accompanied by deplorable procedural deficiencies. In other cases, the audacity of the employee to make complaint about their dismissal was consistent with a history of misconduct that provided unassailable valid reason for which the individual should have been dismissed much earlier. Unfortunately, this case will join the ranks of those elite few which forever remain ignominiously memorable…..

[52] Employees are human beings and not human resources. A machine or item of office equipment might be quickly discarded if it is broken or malfunctioning. However, an employee is entitled to be treated with basic human dignity, and advice of the termination of employment by telephone or other electronic means should be strenuously avoided so as to ensure that the dismissal of an employee is not conducted with the perfunctory dispassion of tossing out a dirty rag……

[59] In summary, this case has involved a very regrettable absence of valid reason for the applicant’s dismissal. Further, it has been highly lamentable to observe the seriously flawed manner in which the employer first determined, and then conveyed the decision to dismiss the applicant. The circumstances of this case provide strong foundation for argument against any lessening of legislative protections for unfair dismissal, a proposition which seems to regularly resurface, and gain a level of publicity that is disconnected with reality.

[60] Regrettably, the dismissal of the applicant was harsh, unjust and unreasonable. Thankfully, the applicant is a person protected from unfair dismissal, and she is entitled to have the Commission provide an appropriate remedy.

Thursday, 13 April 2017

Fair Work Commission 2017 Minimum Wage Review - heads workers lose, tails workers lose?


Fair Work Commission (FWC) website 10 April 2017:       

Every year an Expert Panel of the Fair Work Commission must review modern award minimum wages, and set a national minimum wage order for employees not covered by enterprise agreements or modern awards.
Each national minimum wage order made in an annual wage review comes into operation on 1 July in the next financial year, and continues in operation until the next national minimum wage order comes into operation.

The minimum wage hourly rate currently stands at $17.70 – and yes, we all probably know of an adult who is not even receiving this.

The  FWC Annual Wage Review 2016-17 (C2017/l) is being conducted by:
JUSTICE ROSS, PRESIDENT
VICE PRESIDENT HATCHER
DEPUTY PRESIDENT ASBURY
COMMISSIONER HAMPTON
MR COLE
PROFESSOR RICHARDSON
MR GIBBS,
MELBOURNE, 7 APRIL 2017

The 2017 final minimum wage decision will be handed down in sometime in June coming into effect on 1 July.

Here is the preliminary hearing dealing with transitional instruments and relevant to annual wage reviews and existing arrangements for employees with disability DECISION.

Shorter version of this decision is:

go away little low-skilled people and don’t expect a minimum wage rise larger than that which we gave you in 2013, 2014, 2015 or 2016 - if you are lucky it will be somewhere between 41-50 cents an hour for an estimated 196,300 low-paid workers;

as for workers with a significant disability - too hard, we’ll pass the buck.

Of course if Justice Iain Ross, Adam Hatcher et al listen to the business sector this year then these 196,300 workers will only receive about a 20 cents an hour increase.

Tossing a silver coin in the air right now……….

Friday, 31 March 2017

Dear Malcolm, Barnaby, Scott, Peter, Julie, Alan and friends - before you put that federal budget to bed in May let me tell you about those living in relative poverty


As the Coalition Government approaches yet another cost cutting budget – the fourth since your political parties regained federal government – I’ve noticed how financially comfortable all six of you are in comparison to a great many of other Australians.

It must be satisfying to see your names listed against family homes, rural properties and investments:

8 March 2017
13 January 2017
13 February 2017
15 February 2017
28 November 2016
16 December 2016

However, before your red pens slash across currently funded government programs covering health, education, training, community legal services and various forms of income support, you need to remove those ideological blinkers from your eyes and really look at the people you have been labelling welfare cheats, leaners, lazy bludgers and worse for the last four years.

They are not an anonymous horde harbouring a vile intent to drain money from the pockets of your family, friends and business acquaintances.

These ordinary people are not your enemy.

They are two parents with three young children but only one low-paying casual job bringing in a weekly wage.
The single mother at the bus stop who has to scrimp and save for months to buy her children new school shoes because her rent is too high and her part-time wage too small to allow her to buy all necessities easily.
The old man living alone in a rented flat who goes without meals to pay the veterinary bill for his only companion – his faithful old dog.
It is the grandmother with arthritis who gets up at 5am every weekday so she can travel to her son’s house to babysit her grandchildren so both he and his wife can work to cover the normal bills of a growing family.
A 23 year-old permanently confined to a wheelchair who is determined to live a full life and is out there job hunting every week.
Or the 17 year-old on the street selling The Big Issue to get extra money towards a boarding house bed and meals, because growing up in care left him without a support network.
It’s every middle aged person holding down three separate 8 hour-jobs each week to make ends meet in the face of widespread employer age discrimination and not enough job vacancies.
And so many volunteers in every town or village who spend their few spare pension dollars getting back and forth to the unpaid jobs that keep community alive.

These are people who deserve the certainty of an adequate universal welfare safety net – they are also the voters you will have to face in 2018.