Peter Moron from the land of Fairfax

Never let facts or reality get in the way of a baseless and idiotic identity politics agenda.  Nowadays it seems feelings and intentions are more important that facts and outcomes.

Peter Moron, sorry Martin, is the economics editor of The Age.  One wonders what economics qualifications and understanding one needs to write on economics for the Age, but it is his references that count most.  After all, according to Bernard Keane:

For mine (Peter Martin is) one of the best economic journalists in the country.

Writing today for Fairfax on the case for gender based tax rates, yes, the case to tax men and women differently, Moron, sorry Martin wrote:

Someone who earns $1000 from wages pays twice as much as someone who earns $1000 by making a capital gain selling an asset. Income from capital gains is taxed more lightly in accordance with what’s known as optimal taxation theory.

No they don’t and no it isn’t you idiot.

Someone who made $1,000 from a capital gain did not earn it in 1 single year unlike the person who earned $1,000 from wages.  By definition, a capital gain is earned over more than 1 year.

So if Moron’s, sorry Martin’s, hypothetical person generated their capital gain over 5 years (at an average of $200 per year),  should they pay the same amount of tax in year the asset is sold as the person who earned it all in the same year, and possibly earned $5,000 over the same 5 years?  And should the person liable for capital gains tax also pay tax on the tax that is inflation?

It is because of the recognition of the multi period generation of the capital gain and the the administrative overhead of adjusting for inflation that capital gains tax rate is different to the income tax rate.

Should a farmer who took a peppercorn salary for 20 years to build his business from zero to $5 million be charged the same amount of tax on business sale as someone who earns a $5 million salary?  Spartacus reckons not.  Peter Moron, sorry Martin, seems to think that he should.

Idiot!

Perhap Moron, sorry Martin, needs to set up a tax advisory business with Emma Alberici.  They both seem to be experts on the subject.  #justsaying.

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32 Responses to Peter Moron from the land of Fairfax

  1. Rodney

    Capital gains tax must be fun in Venezuela.

  2. Petros

    I’m not an economist and even I know the difference. Is this why The Age often does not allow comments on many articles?

  3. H B Bear

    He’s no Our Jessica. Fauxfacts – standing on the shoulders of giants. #Gittins

  4. Bruce in WA

    Moron? Harsh, but fair.

  5. The BigBlueCat

    Petros
    #2736686, posted on June 14, 2018 at 10:03 am
    I’m not an economist and even I know the difference. Is this why The Age often does not allow comments on many articles?

    Only on articles where they know leftists will pile on conservatives …. at least The Age doesn’t pretend to be balanced … the ABC on the other hand …

  6. The BigBlueCat

    Writing today for Fairfax on the case for gender based tax rates, yes, the case to tax men and women differently, …

    Well that hardly seems like gender equality, now does it? With the feminists screaming for equality in pay (despite the fact that EBA’s and Awards are gender neutral when it comes to pay rates, and that in the non-award classes there are too many variables that impact pay rates it’s hard to pin it down to gender alone), they now want differential treatment when it comes to taxation? How about NO, you crazy bastards!

  7. Up The Workers!

    “The Age” – the world’s only bum-wipe where all the crap comes pre-loaded!

    It’s Sorbent with newsprint.

  8. Faceache

    Let go, let God. Live and let live. How important is it? One day at a time. …… my survival, sanity, mantra. Along with making a list of things to be grateful for every morning. God bless absolutely everyone. Sigh

  9. notafan

    What specious nonsense is this?

    I am a woman and on numerous occasions over the years have paid capital gains tax.

    As have my mother and sister

    The inflation factor is the issue, very simply and let me tell you I have also paid tax at ordinary marginal rates on share sales that have occurred within a 12 month period

    The horror

  10. Perth Trader

    Spartacas..you do know what the definition of a economist is..’Someone who knows how to make love to a woman 100 different ways, but has never had a girlfriend’.

  11. Spartacas..you do know what the definition of a economist is..’Someone who knows how to make love to a woman 100 different ways, but has never had a girlfriend’.

    there are other options available without the need of a “girlfriend”.

  12. Neil

    Peter Martin introduced this article into leftie laa laa land

    https://www.smh.com.au/politics/federal/hey-big-spender-howard-the-king-of-the-loose-purse-strings-20130110-2cj32.html

    Australia’s most needlessly wasteful spending took place under the John Howard-led Coalition government rather than under the Whitlam, Rudd or Gillard Labor governments, an international study has found

    All the lefties quote it to demonise Howard. In that article Howard was never mentioned. When the IMF talks about Australia it usually combines things since we are a Federation. If anything it was talking about wasteful State govt spending.

    Martin has never apologised for confusing wasteful State govt with the Federal govt he likes to demonise ie Howard

  13. egg_

    Peter Martian is from a parallel clown universe all of its own, parallel to the parallel clown universe.

  14. Pyrmonter

    Martin’s usually wrong, and is again in this (though, in his defence, Arthur Okun suggested something vaguely similar) but seriously Spart, ‘moron’? We’re not in Grade 3.

  15. egg_

    Martin’s usually wrong

    Ever seen him interviewed, as opposed to writing an article?
    Bizarre when speaking off the cuff.

  16. Rohan

    I think Moron Martin is a little upset because his Fairfax shares have yet to make any capital gains.

  17. Has anyone considered that this is intentional, in order to make activities such as investments look like they are getting away without paying tax and robbing from the poor?

  18. Dr Fred Lenin

    Haven’t fauxfacs gone btroke yet? Socialists are not noted for altruism ,who us keeping it afloat ? Turnbull? He is keeping the alpgangrenebc going .

  19. DaveR

    Bemused – you are on the money. Say something often enough and the punters will believe its true. Particularly if you read the Age/SMH and listen/watch the ABC.

    Its part of theShorten ALP/Unions narrative that capitalism is evil, and big companies dont pay their fair share of tax.

  20. Dr Fred Lenin

    Of course unions pay their fair share of tax,even comrade Williamson former alp secretary paid his fair share of the $20,000,000 he STOLE from his Beloved union.and comrade shortass paid his fair share on the $40,ooobribe to help his election , no doubt about the “Fair Sharers” gang ,socially conscious aren’t they ?

  21. Billie

    Bemused .. agreed it’s possible, after all wasn’t that the gist of Emma “#justsayin” Alberici’s field entry?

    All good B ark grist

    I understand the frustration by the author though, how do entertainers get passed off as journos?

  22. You should do better

    Someone who made $1,000 from a capital gain did not earn it in 1 single year unlike the person who earned $1,000 from wages. By definition, a capital gain is earned over more than 1 year…..And should the person liable for capital gains tax also pay tax on the tax that is inflation?

    Wrong Spartacus – that’s not the definition of a capital gain.

    Short term capital gains exist … the original author has a strange position but yours seems based on a lack of understanding of the CGT system in place in Australia. Further, for assets acquired since September 1999 the system no longer allows for the indexation of the cost base although a 50% deduction is allowed (which suggests that in some cases receipts received in the form of capital gains may be tax-advantaged over the distribution of that same cash as income over the life of the asset).

    Read up my friend.

  23. Dear You Should Do Better.

    See ATO website – https://www.ato.gov.au/general/capital-gains-tax/working-out-your-capital-gain-or-loss/working-out-your-capital-gain/

    for CGT – Eligibility: For assets held for 12 months or more.
    50% discount (instead of indexation method) applies only to individuals and small business.

    it is 1/3 for super and indexation for non small business.

    Read up my friend.

  24. MD

    Re the comments from and to ‘you should do better’. It is not accurate to say a CGT event arises after only one year as I think you, Spartacus, stated. Rather you get your 50% discount only if you have held the asset for more than one year. A taxable capital gain arises the instant a ‘CGT event occurs’, and if such event arises inside 12 months you incur the top marginal rate of tax, no discount at all.

    The journalist, from your account, objects to this discount, the rationale for which he either may not know or may regard as ‘unjust’. As you may know, the discount arose from the Ralph report which considered that the old indexation method was too complex, so merely for simplification’s sake Ralph proposed a single rate of discount. Compared with old system, some people may benefit more from the Ralph discount; others may benefit less. But certainly it would be very harsh to impose a full CGT rate calculated without regard to inflation.

  25. David Brewer

    Thanks MD for the clarification.

    The major “simplification” in 1999 was to make a flat discount of 50% on the gain to be taxed, as soon as the asset was held for one year. As you say, it’s the discount that cuts in after a year, not the fact that there was a capital gain.

    This “simplification” was a disaster from the point of view of an equitable tax policy. The previous system was to tax 25% of the after-inflation gain, a much fairer system given the ravages of inflation over the long term. Applying a 50% discount to a gain made in the last year, and the same 50% discount to a gain made on an asset bought 30 years ago, is ridiculous. It results in handing a windfall to short-term investors, while taxing long-term investors on “gains” that may even be losses in after-inflation terms.

  26. Dr Fred Lenin

    See the US Reserve has raised interest rates for the second time this year,up.25 to 2.0 per cent and predicts two further rises this year . The reason given is the US economy is booming ,probably Trumps fault , bastard !getting things going again , what about the debt ridden who will go to the wall if interest rates keep rising , that would never have happened under a hilarity /obummer government ,he’s going to destroy governments as the interest to be paid for the money the borrowed in the peoples name goes up ,and their people have to pay more interest to borrow the money to pay the interest on the money previously borrowed , if you know what I mean . Lots of politicians will be resigning to spend more time with their families what a terrible loss to society

  27. Me Bunny

    I for one strongly support males and females paying the same level of tax. The taxes of all males should reduced so on average they pay the same amount as females. Of course another method is to increase the average tax all women pay. Problem solved. No discrimination.

  28. Alexi the Conservative Russian

    Gee Sparty try and get a bit of emotion into your writing.

  29. Rococo Liberal

    The income tax rate and the CGT rate are the same, because CGT is just income tax. There in fact no capital gains tax at all. What happens is that net capital gains are added to assessable income.
    If you’ve owned the asset for less than a year, then the tax you pay on the capital gain will be exactly the same as the tax on any other income.

  30. Petros

    No problem calling him a moron. We have been too polite for too long. Was it Professor Bunyip who called her A Dill Ferguson?

  31. Pyrmonter

    @ MD and Brewer

    The 50% discount is only applied to individual taxpayers; trusts and companies get 30%.

    Why Ralph thought indexation was hard in the days of Excel has always escaped me. He answered a problem from 1982, not 1999.

  32. Jimf

    I have more respect for my arsehole than to wipe The Age on the poor thing .

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