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I wonder how much money is being wasted on this review when they're just going to jack the GST up to 15% anyway.
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Mar 30, 2015 00:02
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quote:Craig Thomson: Call for civil trial to be called off due to serious mental health issues http://www.abc.net.au/news/2015-03-30/thompson-shouldn27t-face-civil-trial-due-to-serious-mental-hea/6358222 I'd never dismiss claims like this out of hand but he would not appear to have a record of honesty. Obligatory got a fool for a client too.
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Mar 30, 2015 01:34
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Just a comment on the proposed deposit tax in the budget, it's a good idea. It effectively means a person with $10,000 in the bank pays $5 per annum for the privilege of having it insured by the Australian government. In return, we get an additional disincentive to keep money lying around in deposits instead of, say, investing it in productive assets. It's economic stimulus through and through, which is what we need right now.
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Mar 30, 2015 01:35
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That's more like $50. I'd guess people with substantial sums in the bank will be able to get around it without issue anyway.
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Mar 30, 2015 01:39
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open24hours posted:That's more like $50. I'd guess people with substantial sums in the bank will be able to get around it without issue anyway. How would they be able to get around it?
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Mar 30, 2015 01:41
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Les Affaires posted:How would they be able to get around it? Owning the news corporation that rallies against it being implemented at a level that would impact them in anyway.
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Mar 30, 2015 01:43
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Les Affaires posted:How would they be able to get around it? Deposit it somewhere that isn't subject to the tax.
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Mar 30, 2015 01:52
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open24hours posted:Deposit it somewhere that isn't subject to the tax. Fair enough, I suppose you can rely on a certain percentage of the ~$700b of deposits being offshored, but in the process of converting it to offshore deposits, the effect would be to drive down the AUD relative to other currencies - which is also stimulus!
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Mar 30, 2015 01:55
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I don't really understand this bank deposit tax thing tbh, does this mean if I borrow money from someone and its transferred into my bank account and vice versa when I pay it back we both get taxed at each end? That seems pretty hosed and I'd be happy if someone would tell me I'm wrong and explain what this poo poo actually means.
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Mar 30, 2015 01:56
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kingcom posted:Owning the news corporation that rallies against it being implemented at a level that would impact them in anyway. There is very little about the deposit tax in the oz papers that I've seen. It's mostly being reported by fairfax. Of the two stories in the oz (business review), they haven't -really- been pushing hard line in one direction or another, except to say that it goes against the recommendations in the Murray review.
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Mar 30, 2015 01:56
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MC Eating Disorder posted:I don't really understand this bank deposit tax thing tbh, does this mean if I borrow money from someone and its transferred into my bank account and vice versa when I pay it back we both get taxed? That seems pretty hosed and I'd be happy if someone would tell me I'm wrong and explain what this poo poo actually means. It's effectively a -0.05% per annum interest rate on amounts you have sitting in your bank account. So if your bank processes interest monthly, that's -0.05 / 12 % paid as a tax.
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Mar 30, 2015 01:57
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MC Eating Disorder posted:I don't really understand this bank deposit tax thing tbh, does this mean if I borrow money from someone and its transferred into my bank account and vice versa when I pay it back we both get taxed at each end? That seems pretty hosed and I'd be happy if someone would tell me I'm wrong and explain what this poo poo actually means. It basically means the government takes 0.5% of your interest, or if the interest rate is below 0.5% they take some of your capital. If the interest rate drops below 0.5% you might as well keep your cash in your mattress. [efb]
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Mar 30, 2015 01:59
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Cash deposits in mattresses will go up, I guess. Despite it being a worse option than leaving it in the bank - unless you for some reason have it sitting in an effectively 0% interest account. Also stupid regress tax. Why not just adjust income tax.
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Mar 30, 2015 02:00
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Ok thanks for explaining that because it doesn't actually look like there's very much information about how the tax functions in the stuff about it, even going back to the articles on when Labor tried to introduce something similar so its been very frustrating watching people argue about this poo poo on facebook. As a poor who never has money in their account I don't think this really affects me so I'm just gonna ignore it completely.
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Mar 30, 2015 02:02
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open24hours posted:It basically means the government takes 0.5% of your interest, or if the interest rate is below 0.5% they take some of your capital. If the interest rate drops below 0.5% you might as well keep your cash in your mattress. How long until it's revealed that the owner of a mattress company is making significant donations to the Liberal party?
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Mar 30, 2015 02:03
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open24hours posted:It basically means the government takes 0.5% of your interest, or if the interest rate is below 0.5% they take some of your capital. If the interest rate drops below 0.5% you might as well keep your cash in your mattress. From Fairfax I'm reading that it's 0.05% not 0.5%: quote:According to the 2014-15 Commonwealth Budget, the guarantee covers $723 billion of deposits. The expected 0.05 per cent annual premium would therefore raise $362 million annually.
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Mar 30, 2015 02:03
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MC Eating Disorder posted:Ok thanks for explaining that because it doesn't actually look like there's very much information about how the tax functions in the stuff about it, even going back to the articles on when Labor tried to introduce something similar so its been very frustrating watching people argue about this poo poo on facebook. The way it would work is that periodically each financial institution that is covered by the tax would have their total deposit balance assessed and then the tax would be applied to that balance in a one-off payment by the bank. The bank then has to work out how to pay for that tax, either by absorbing it in their margin, or by passing it onto the consumer. The likelihood is the latter. My guess is that the amount would be calculated daily but paid monthly to the government.
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Mar 30, 2015 02:06
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ABC says 0.5%, but 0.05% does seem more likely.
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Mar 30, 2015 02:09
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When I say it's economic stimulus, what it effectively means is that each participant in the economy will have less incentive to just hoard their cash in deposits. For a company with a large cash balance just sitting there in the bank doing nothing - like say $100m - they will earn $50,000 less in interest than they would have previously. This might seem like gently caress all, but across the economy it provides that tiny little bump towards behaviour that stimulates the economy. A business that has 100m in spare cash lying around could be using it for research and development, or expansion, or paying out to shareholders. Shareholders who receive a dividend could either keep it in the bank earning less interest than before, or they could invest it elsewhere, like in a business or the stockmarket. Or they could go buy something with the money instead, again stimulating the economy. It's a nudge for capital to get up and put their money to better use than just loving leaving it in the bank. It's a good thing.
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Mar 30, 2015 02:12
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This seems like a much better idea than just making sure rich fucks and corporations pay their loving taxes, yes siree bob.
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Mar 30, 2015 02:14
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Everything that was old is new again: http://en.m.wikipedia.org/wiki/Financial_institutions_duty At the time the Government clipping the ticket when people deposited money and they withdrew it (not what this proposal is about) was seen as a bit of a poo poo and only encouraged dodgy behaviour.
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Mar 30, 2015 02:14
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Laserface posted:This seems like a much better idea than just making sure rich fucks and corporations pay their loving taxes, yes siree bob. Plus "just make sure people pay tax" isn't a trivial thing to do.
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Mar 30, 2015 02:16
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Laserface posted:This seems like a much better idea than just making sure rich fucks and corporations pay their loving taxes, yes siree bob. *blows whistle* False dichotomy play, fifty metre penalty.
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Mar 30, 2015 02:17
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Awesome, so anyone with a home loan can avoid this tax with a few clicks in netbank and anyone living paycheck to paycheck has to pay it. Good work guys.
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Mar 30, 2015 02:21
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The risk of bank collapse is created by lending, E.G risky mortgages (think interest only, parents acting as guarantors, enormous principals, and the general lack of prudence that exists at record low interest rates). The cost of insuring this risk is born not by the borrowers/lenders (the risky part of the banks), but by the prudent (I.E people who save). There's legitimate reasons to put money on the bank rather than invest it, older people trying to live off their savings in particular have very little appetite for risk. People with a nervous disposition too. It makes sense for them to stay liquid.
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Mar 30, 2015 02:22
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norp posted:Awesome, so anyone with a home loan can avoid this tax with a few clicks in netbank and anyone living paycheck to paycheck has to pay it. If you're living paycheck to paycheck how much is this actually going to cost you?
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Mar 30, 2015 02:25
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Enough to hurt you, I'm guessing. 
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Mar 30, 2015 02:29
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norp posted:Awesome, so anyone with a home loan can avoid this tax with a few clicks in netbank and anyone living paycheck to paycheck has to pay it. If you're living paycheque to paycheque, the volatility of your bank account will mean that the effect on the "deposit balance" of the bank will be pretty much neutral, and the amount of interest you're earning on that account will be not much anyway. The fact that it's a levy on the banks rather than the bank's customers means the banks have to weigh up the most appropriate way of passing it onto their consumers. It's too early to tell whether the banks will pass part of the levy onto people with a loan as well, which they very well might. Jumpingmanjim posted:The risk of bank collapse is created by lending, E.G risky mortgages (think interest only, parents acting as guarantors, enormous principals, and the general lack of prudence that exists at record low interest rates). The cost of insuring this risk is born not by the borrowers/lenders (the risky part of the banks), but by the prudent (I.E people who save). There are two main risks to banks: a higher than predicted rate of mortgage default (not paying loans back), or a higher than predicted run on deposits (eg "GIVE US ALL OUR MONEY BACK"). The alternative proposal in the Murray review was an increased capitalisation rate for all banks, which would disproportionately affect the major banks who are more highly leveraged. The fed gov wants as much revenue as possible, and a higher capitalisation rate will not give them that. APRA may still rule that the majors need a higher capitalisation rate, as it's their jurisdiction.
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Mar 30, 2015 02:31
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Just make it only apply to people with more than $125,000 in bank deposits.
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Mar 30, 2015 02:31
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Doctor Spaceman posted:If you're living paycheck to paycheck how much is this actually going to cost you? Presumably if its passed on to the customers directly, .05% of your net income since you don't accumulate any interest living paycheque to paycheque, so 3.5 dollars a year for me personally This doesn't seem that terrible as a broke piece of poo poo. I'd love to hear a compelling argument to be outraged at Joe Hockey but I'm not feeling it right now
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Mar 30, 2015 02:32
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Need money? Want to introduce a new tax, but can't break election promises? Introducing the LNP patented 'not a tax' ™
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Mar 30, 2015 02:39
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Its possible thinking about it, that if it isn't passed on directly to the customer that might have a higher chance of affecting low income earners since absorbing it into their operating costs could mean fees and charges might increase but presumably that stuff will apply more to term deposit accounts than my bank account I am required to get paid into so I can take it out of an ATM and spend it on piss and drugs and lovely food
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Mar 30, 2015 02:39
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Just (casually) reading the Rio Tinto 2014 annual report, they have about 12b in cash and cash equivalents. If they hold all of that in cash, and all of it was held in Australia, that's $6m in extra revenue to the government. While a 100% scenario is unlikely, a fair majority of it would need to be held here just to pay for operating the business.
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Mar 30, 2015 02:40
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How efficient is a tax like this compared to raising income tax, corporate tax, or the GST by the same amount?
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Mar 30, 2015 02:41
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When the bank account guarantee was brought in it was decided the levy would only be charged if a bank needed to be bailed out. This was how the Pyramid building society collapse was dealt with. This is about improving the budget situation, that's all. Would be ironic if the levy motivated people to take money out of their bank accounts.
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Mar 30, 2015 02:41
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It raises less than half a billion, it's not really about fixing the deficit directly.
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Mar 30, 2015 02:43
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open24hours posted:How efficient is a tax like this compared to raising income tax, corporate tax, or the GST by the same amount? I'd estimate more efficient than income tax and corporate tax, but less efficient than the GST. Jumpingmanjim posted:When the bank account guarantee was brought in it was decided the levy would only be charged if a bank needed to be bailed out. This was how the Pyramid building society collapse was dealt with. This is about improving the budget situation, that's all. That's kind of the point though. Take your money out of your account, what will you do with it? Stuff it in the mattress? Spend it? Invest it? The latter two are economic stimulus, the first one is pretty dumb (imho).
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Mar 30, 2015 02:44
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The problem I see is that for people with "medium sized deposits" ($50k to $150k), it might just encourage them to invest more into property.
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Mar 30, 2015 02:48
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Les Affaires posted:I'd estimate more efficient than income tax and corporate tax, but less efficient than the GST. It's a levy to pay for a system that's supposed to ensure the solvency of the banks. It shouldn't be encouraging withdrawals. That's rather self defeating.
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Mar 30, 2015 02:49
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Doctor Spaceman posted:If you're living paycheck to paycheck how much is this actually going to cost you? Yeah sorry, I didn't put a lot of effort into that comparison. What I meant is that someone with an offset account would get charged this on their "deposits" in the offset BUT they generally also have free redraw so it's trivial to move their balance to the other ledger where it won't count as a deposit. What I was getting at was that the only people who have to pay this tax will be those with no net debt on their personal balance sheet. First thing that came to mind was people living hand to mouth, but retirees commonly have large cash balances to avoid risk which would have been the better example.
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Mar 30, 2015 02:51
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