Is it really taxation for the common good, or rather, or a form of extortion by a greedy entity that demands obedience?
The issue of taxation is always one that brings anxiety and politics to the fore, those on the left say were aren’t taxed enough until the asset seizures and church burning starts, and those not on the left say any money going to government is wasted.
Perhaps somewhere in the middle there is a reasonable compromise, though, there are suspicions that none will ever be reached.
The discussion around taxes is often made from two equally wrong points, one being that we have a relatively low taxation to gross domestic product ratio, and the second being that tax cuts are always good.
The first is wrong for two very good reasons, one, it ignores the obvious point about other nations having a taxation to gross domestic product ratio that is too high, there-fore creating an unrealistic benchmark, second, because those data indices often ignore fees, duties and other government charges, and they often ignore Australia’s three separate levels of tax collecting entities. The second is wrong because it ignores the likelihood of governments recouping any loss in revenue due to a tax cut by simply increasing the amount it receives in fees and charges, which may actually do more harm than any level of good achieved by the tax cut itself.
It has been a common theme for governments in the past, lower taxes at the margins and then increase fees and charges to ensure the government’s position remained revenue neutral.
Certainly everyone can accept that any government created by society is going to need monies in order to function. However, when society creates three separate levels of government, each with competing interests, each with competing agendas, and each with its means of collecting income the issue becomes, at what point does the means and amount being collected become counter-productive?
If Australia has to compete in the global market space to ensure business entities operating here earn enough income to employ Australians there must be a natural level at which the cost of business becomes too great for the external markets to carry.
It comes down to a simple choice, you can either have expensive workers or expensive government, but you can’t have both.
And inevitably expensive workers lead to expensive government.
That isn’t argument for lowering wages and the like, only, the government should be forced to consider its position and its negative influence in allowing business entities paying their workers more. Every penny a government takes away from a business is a penny less a worker can earn, and every penny less a worker earns means the government gets a lesser taxation dividend from the worker.
It must also be considered that people may in-fact desire expensive government, that being the case, those people must consider giving up one or two layers of that expensive government.
Australia, a nation of a mere 23,000,000 people does not require three separate layers of expensive government, it really doesn’t need two layers of expensive government either. As a federation the federal government layer could quite easily be run by a council of state governors and a minimalist directly elected council of ministers that would carry out the duties of agreed joint ventures between the states, such as defence, customs and foreign relations.
Or the state governments could be devolved into a council of provinces that are themselves created by groupings of local governments, with the over-arching state government being nothing more than an assembly of elected local councilors or mayors with a directly elected executive to provide funds for distribution to the provinces.
The idea that we need hundreds of federal members of parliament with dozens of senators, thousands of local councilors and mayors and hundreds upon hundreds of state members of parliaments across the continent and their attached senators is ludicrous, and ludicrously expensive. Remember, all of these people need to get paid, their staff need to get paid, their buildings and offices need to be funded, their travel, meals, pensions and perks all need to be funded by taxes. Meaning, the instruments by which taxes are levied and collected itself becomes an ever increasing expense on the tax-payer, an expense that we as a small nation could easily do without.
Taxes are always a volatile issue, the Americans got so upset at taxation they had themselves a rebellion, and then created the most powerful republic since Caesar was stomping the streets of Rome.
Taxes were also very important to the Romans, it was taxes that allowed them to become so great and forge their empire, like the Greeks before them, taxes and trade, trade lead to wealthy people, wealthy people meant wealthy government.
A simple equation, the more people earn the more they can pay. But that is only possible if the government isn’t taking an ever increasing share from both those doing the paying and those being paid.
This makes the discussion about taxes much a discussion about government, if we really want lower taxes, then we must discuss having less government, a lot less government. And not only lot less government in the physical sense, but a lot less government in the realms of what governments do. There should be no over-lap or duplicity in government, that is essentially taxing the citizen more than once to do something more than once for something should only have to be done once.
There should also be very real and absolute limits to what the government can and can not do and fund from the public purse. The government should not fund people who lobby government, essentially that is a case of the government paying someone else to decide how the government should run its affairs, which is exactly what the tax-payer pays the government to do all on its own.
The above is one example of which there are many, such as the government paying private consultancy firms to advise government on making decisions. If that being the case, why don’t the tax-payers just pay the consultants directly to run the country? It would save a lot of time, energy and money on largely unnecessary elections.
The government should be as small as absolutely possible and tax the citizen accordingly, and for that the happen the citizen must accept that the government can’t be all things to all people.
And if the citizen can’t accept that, the citizen must stop complaining about the government’s hand in his pocket.
If Australia wants to be wealthy prosperous nation once the mineral boom ends it must begin the process of re-configuring government, because there are those in the governing class that actually do believe in the assets seizure and church burning policies used by the Soviets, and wouldn’t hesitate in implementing them given the opportunity.
And there are those in the governing class who have no idea what government is there for apart from providing them with a comfortable job. And there are those who believe government exists only to provide the end point of their careers in the union movement. And there are those in the governing class who see government as a means of entrenching the status quo and those that benefit most from it.
If Australia wants to be a serious grown-up country it needs to be brave enough to make tough decisions and re-create the nation itself, and do so beyond that which was seen by the small grouping on colonies and colonialists who wrote the original constitution thought it should look like.
And we should do so because tax rebellions have a historic tendency of becoming nasty.