Labor’s tax attack on savings counter-productive

Today in The Australian (with Jonathan Pincus)

Australia may find ­itself next week on the path to the largest peacetime tax increases since Federation. It is not simply the magnitude of the tax rises that makes Labor’s plans exceptional — both in historical terms and relative to global trends — it is that they are so heavily focused on penalising saving.

About Henry Ergas

Henry Ergas AO is a columnist for The Australian. From 2009 to 2015 he was Senior Economic Adviser to Deloitte Australia and from 2009 to 2017 was Professor of Infrastructure Economics at the University of Wollongong’s SMART Infrastructure Facility. He joined SMART and Deloitte after working as a consultant economist at NECG, CRA International and Concept Economics. Prior to that, he was an economist at the OECD in Paris from the late 1970s until the early 1990s. At the OECD, he headed the Secretary-General’s Task Force on Structural Adjustment (1984-1987), which concentrated on improving the efficiency of government policies in a wide range of areas, and was subsequently Counsellor for Structural Policy in the Economics Department. He has taught at a range of universities, undertaken a number of government inquiries and served as a Lay Member of the New Zealand High Court. In 2016, he was made an Officer in the Order of Australia.
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19 Responses to Labor’s tax attack on savings counter-productive

  1. stackja

    And ALP worried. So this happened:

    Worker who put Shorten on spot over tax cuts suspended
    Renee Viellaris, Federal Political Editor, The Courier-Mail
    May 13, 2019 12:00am
    Subscriber only
    THE Gladstone Ports worker who tripped up Bill Shorten on Labor’s tax plan for high-income earners has been suspended and forced to find another job.

    The gutted 49-year-old was told he was in breach for speaking to the media when filmed questioning Mr Shorten at the Queensland Government-owned Gladstone Ports Corporation, saying “it would be good to see higher-wage earners given a tax break”. The next day the father-of-three’s pass did not work and he was officially told he was suspended. Last week his desk was packed up and delivered to his house.

    The experienced electrical engineer has unintentionally become a victim of the cut-and-thrust of a high-stakes election campaign, which will be decided by a handful of marginal seats, ­including Flynn, which includes Gladstone.

    Events unfolded at the port on April 23, when the worker made his off-the-cuff comment to Mr Shorten, who had approached him.

    The worker, who had earned about $250,000 last financial year, forgot his lunch that day and got caught up in the media scrum during a free barbecue.

  2. flyingduk

    There is nothing new here, both sides of government have been ‘anti savings’ for decades, ever since they discovered they can conjure up ‘money’ to spend simply by printing it. They are quite up front about it, telling us openly they target an inflation rate of 2-4% per year. Their low interest policy of the last 10 years has only added to it. Winter is coming…

  3. Bad Samaritan

    C’mon Cats. Less than a week to go….What’s the best way to protect your wealth from Labor. Where to put it so that they can’t take it. Serious suggestions please.

    Sure, physical gold stashed in a good spot; some of it in smaller ingots (1oz etc) is good but even a modest amount of wealth….say a million$A…..is 17 kgs of gold. Help!

    The worry is that Labor will directly confiscate wealth, be it cash, stocks/bonds, property….anything they can find, or else they’ll cause massive inflation a la Venezuela. All ideas much appreciated.

  4. Tel

    But we need 12% Super because people aren’t saving enough! The dumb oiks can’t manage their money properly, they need union bosses who are the top quality money managers.

    Das Kapital Management!

  5. nb

    stackja #3011121, posted on May 13, 2019 at 7:26 am says:

    THE Gladstone Ports worker who tripped up Bill Shorten on Labor’s tax plan for high-income earners has been suspended and forced to find another job.

    Wow!
    Bad Samaritan #3011158, posted on May 13, 2019 at 8:32 am asks:

    ‘What’s the best way to protect your wealth from Labor.’

    Great question!
    Labor takes its orders from overseas. The main game is to destroy the Anglo countries as they are resistant to socialism.

  6. NuThink

    forgot his lunch that day and got caught up in the media scrum during a free barbecue.

    So there is no such thing as a free speech lunch barbecue. Beware of the barbs in barbecue, they can get you.

    Wonder what happened to these guys who refused to shake Bill’s hand. Do they still have their jobs?

    https://www.facebook.com/SenatorMcGrath/videos/740611259668314/

  7. Chris M

    Matthew 6:19 “Lay not up for yourselves treasures upon the earth, where moth and rust spoils, and where thieves dig through and steal; but lay up for yourselves treasures in heaven, where neither moth nor rust spoils, and where thieves do not dig through nor steal; for where thy treasure is, there will be also thy heart.”

    Many of us have one foot in the grave, no one is guaranteed tomorrow. This place might be going downhill economically and socially but in the big picture that’s a tiny blip. Time to plan for the future!

  8. tombell

    Sure, physical gold stashed in a good spot; some of it in smaller ingots (1oz etc) is good but even a modest amount of wealth….say a million$A…..is 17 kgs of gold. Help!

    Not so fast Bad Samaritan.

    Can the Australian Government confiscate private gold, silver and all other precious holdings?

    The answer is YES!

    With the amount of people (including myself), buying up precious metals (silver in particular), and constantly reading articles regarding the coming global financial crisis and the benefits of buying silver as a commodity in a sure way to ride out any crisis or collapse, I started looking closely at the Reserve Bank Act 1959 and all the amendments since.

    A little known Act of Parliament that has been in place since 1959 allows the Government to do just that…

    More and more Australians are making larger investments in precious metal bullion and coins as global financial crisis continues. What the vast majority of these investors don’t realise is that Part IV of the Banking Act 1959, although suspended in 1976 (but not repealed), gives the Commonwealth the right to confiscate private gold and silver to have it delivered to the Reserve Bank of Australia (RBA). This includes all gold and silver in allocated, unallocated and private storage, any bullion products purchased since 2007 and purchases prior to 2007.

    Just do an internet search for gold confiscation and you’ll get all the details.

  9. How about death duties not being a tax on savings, so why not? One step further; you didn’t earn it (the inheritance), so it doesn’t belong to you.

  10. Rob MW

    Gawd, a possible Shorten/Bowen gov’t. Tits, Arses & Taxes, bring back Kevvie and Swannie (the greatest treasurer/treasure in the world). I suddenly like pie charts of mining companies taxes that excludes company tax, I really like the carbon tax and the NBN, all is forgiven Kevvie and Juliar, please come back.

    SOS…….. CALLING: PETER COSTELLO

  11. Bad Samaritan

    tombell (10.06am) yeah…that’s what I’m getting at. Seventeen Kgs can be physically stashed in a nice hole, but that’s still heavy. And a million bucks in silver….well that’s tonnes!

    So the question is; how to protect your wealth against confiscation, and against inflation.

    OK, so shipping it off to a tax-haven could work, but what if that govt falls to leftists too?

    Anyone got ideas?

  12. Bad Samaritan:
    I predict that if there is even a whisper of gold/silver confiscation, there will be a spate of burglaries.
    Just a feeling I get.

  13. flyingduk

    C’mon Cats. Less than a week to go….What’s the best way to protect your wealth from Labor. Where to put it so that they can’t take it. Serious suggestions please

    Bitcoin…

  14. stackja

    FDR confiscated gold and silver. MSM probably approved.

  15. Pedro the Ignorant

    If you are buying physical gold, buy it privately.

    All licensed bullion dealer transactions are recorded and therefore subject to .gov scrutiny and we all know where that will end up after Tits gets hold of the keys to the Lodge.

  16. Zulu Kilo Two Alpha

    How about death duties not being a tax on savings, so why not? One step further; you didn’t earn it (the inheritance), so it doesn’t belong to you.

    It’s not fair that you should have all that money to pass on, “Big Brother knows best.”

  17. stackja

    People who vote for ALP don’t think they will pay for all BS promises. All Australians will pay some how.

  18. Squirrel

    With the disincentives being proposed by Labor for effort and sacrifice in mind, it is sadly amusing to hear the would be Treasurer fretting in public about the world-beating levels of household debt in Australia.

    Wouldn’t a politician genuinely concerned about household indebtedness (a good deal of which is by choice, not necessity, as Labor would have it) be keen to provide incentives for providence and self-reliance?

  19. Zulu Kilo Two Alpha

    People who vote for ALP don’t think they will pay for all BS promises. All Australians will pay some how.

    People who vote for the ALP don’t think they will pay – the “Top end of Town” will foot the bill.

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