Tuesday, April 21, 2009

"Rudd goes after the Wealthy"

I've written today's Blogg in response to an article in today's Newspaper titled "Rudd goes after the Wealthy". Read the article at:


I can't help but think that our whole tax system really is back to front. And let me tell you why.

On the whole, the majority of the people targeted in these situations still pay a high level of tax each fiscal year. Politicians and the various members of the Politics of Envy Party would have you think that this is not the case but the fact remains that the tax they are talking about in these "loop hole" situations is indeed minimised but rarely wiped out. And remember, "minimised" means different things to different people depending on what tax rate they are on. Some people minimise their tax and their tax bill might still be $200,000 or in the millions.

It's important to also remember that these people are currently not doing anything illegal and, frankly, they would be regarded as foolish if they didn't minimise their tax as any other taxpayer would in their position. I still remember Kerry Packer saying something to that effect many years ago and he was absolutely right. The Australian Taxation Office is not a charity that we donate to when we are feeling generous, it is a government institution where certain rules apply to our income and we follow those rules.

Is Mr Rudd making the mistake that so many politicians of the past have made? Is he targeting the wrong audience? Instead of demotivating high income earners, is it time Mr Rudd tried the reverse and motivated Australians to greater success rather than demotivated them to less? After all, doesn't the government have the most to gain from increasing the success chances of each and every Australian by somehow unlocking the potential that remains more and more dormant as the group depending on handouts continues to grow? Indeed, to motivate through reward might lead to innovation, and god forbid, new industries and employment!!! And so goes the cycle...

Could the reason this country has problems not simply be about loop holes but be about the fact that there are simply too many people sitting around doing nothing and getting paid for it and what's worse, that they think it is their god given right to?

We all know that jobs are hard to get right now (and again our Government is very good at telling us how bad things are and how bad they are going to be in the future) but the truth of the matter is that many of these people, to whom I am referring above, were sitting around when times were very good. THEY are what is dragging this country down, not the high income earners who actually make a contribution. It really is as simple as that.

Our tax system needs to motivate, motivate, motivate. Right now it doesn't. It looks like the house with 1000 extensions because everyone that has owned it added their little bit here and there. There comes a time that it should just be bull dozed and rebuilt from scratch because the foundations are crumbling and it looks plain ugly.

Another thing I would like to address is the growing discomfort at having wealth in this country. If you earn good money, I urge you not to feel guilty about it and not to let anyone else make you feel guilty about it. I will admit that I am what would be classified as a high income earner and I refuse to apologise to anyone for it (not that I go around telling anyone). I see it as an inevitable outcome after many years of effort (and continuing effort) by my husband and myself. I don't lie, I don't cheat, I don't rip anyone off, and I am very good at what I do. This is the side of the high income story does not get told enough. Do I reduce my tax as much as I can? You bet I do. Do I still pay alot of tax? You bet I do!

So come on Australians, let's go back to a relatively old idea but a great one, "stop asking what your country can do for you and ask what you can do for your country!". True success is keeping the government out of your life as much as you can.

What's your opinion on our tax system? Would love to hear from you!!

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