What do you think of the GST? - Page 2

ImpulseTaco · 20-01-2006, 04:42 PM

Quote:

Originally Posted by svo347

No offense taken mate...
the reason theres little manufacturing is because in todays society, its far more cheaper to manufacture items overseas than what it would be to do it here.
Why pay someone $15p/h when theres alot of people willing to do it for $5

I think all that comes at the expense of quality. You can go and buy cheap Chinese made junk, and you get just that, or if you're willing to bear the extra expense, you can get something made in Japan, Germany, etc and have a MUCH higher level of quality, fit/finish, etc.

I fear the day when the Chinese start exporting cars here.

svo347 · 20-01-2006, 04:43 PM

Fair point and Welcome to the forums mate!!

ImpulseTaco · 20-01-2006, 04:47 PM

Quote:

Originally Posted by svo347

Fair point and Welcome to the forums mate!!

I'm not exactly new here, but thanks just the same

:

By the way though, I must say, I really like Oz wine. You guys make some stuff, Yellow Tail, thats pretty good, and at quite a fair price.

Thunder · 20-01-2006, 06:35 PM

Quote:

Originally Posted by EA2BA

everything was goning to get 'cheaper' ..... and pigs fly, things are not cheaper, i reckon they cost more.

Everyone voted in the govt knowing it would be brought in, then 99% of people complain about it, i diddnt vote it in thats for sure.

Cars became cheaper. 2 months prior to the GST coming in the car i wanted cost $29250. I waited till after the GST was implimented and the car was $26750. It was a Honda, and imported cars became cheaper. But i reckon the government failed in its promise to ensure business passed on the savings of GST. Other than my example what else became cheaper?

The government did not investigate the companies that cashing in. Prior to the 10% GST, sales tax was between 22-27%. Where did the savings go?

max^power · 20-01-2006, 06:58 PM

I was late with a few bas statements, so they fined me $10k. ATO is a nice bunch, thanks mr howard, you really like to bring down the little guy.

LTDHO · 20-01-2006, 07:42 PM

I hate it with a passion.

It was the sole reason my business went bust, I was making heaps then for 6 months everything stopped and people were not spending $$$$.

I hate is now because it didn't make anything cheaper. We pay 10% on pretty much everything.

deesun · 20-01-2006, 07:45 PM

Quote:

Originally Posted by Thunder

Cars became cheaper. 2 months prior to the GST coming in the car i wanted cost $29250. I waited till after the GST was implimented and the car was $26750. It was a Honda, and imported cars became cheaper. But i reckon the government failed in its promise to ensure business passed on the savings of GST. Other than my example what else became cheaper?

The government did not investigate the companies that cashing in. Prior to the 10% GST, sales tax was between 22-27%. Where did the savings go?

The previous tax was on the wholesale price but GST is on the retail price.
EG.WS $10,000+ 25% tax + 25% mark up = 10,000+2500=12500+ 25%=15625
With GST it is WS 10000+ 25%m/u =12500 +10% GST =13700.But some items only had 10% tax on them so the savings were negligible
EG 10000 +10%tax = 11000 + 25% mu= 13750
or 10000 + 25% m/u = 12500 + 10% GST= 13750= no saving at all. It all depended on what amount of wholesale tax.

rodderz · 20-01-2006, 07:56 PM

I remember one of the government's selling points was that they would be decreasing the income tax on your wages so you would make more, and instead there would be the GST on good and services

Only problem is, for the majority the pay only went up a few dollars and good & services keep going up at a much faster rate than what wages do

As for businesses as far as I can see you do a BAS every 3 months or so, which is like a tax return but more frequently than the usual once yearly one.

max^power · 20-01-2006, 08:12 PM

i had mine monthly initially... what a nightmare!

ImpulseTaco · 20-01-2006, 08:41 PM

Quote:

Originally Posted by Thunder

Cars became cheaper. 2 months prior to the GST coming in the car i wanted cost $29250. I waited till after the GST was implimented and the car was $26750. It was a Honda, and imported cars became cheaper. But i reckon the government failed in its promise to ensure business passed on the savings of GST. Other than my example what else became cheaper?

The government did not investigate the companies that cashing in. Prior to the 10% GST, sales tax was between 22-27%. Where did the savings go?

So Falcons became a disadvantaged tax wise, compared to imports? What a shame!

rag top · 20-01-2006, 08:54 PM

I'm glad I bought my first home just prior to the GST coming in. The Govt. first home buyers grant was suppost to cover the increase in house prices... But they didn't count on a property boom.

**Polyal** · 20-01-2006, 09:51 PM

personally it hasn't effected myself greatly yet, but I have't done any major purchasing.

I just got back from Canada and there system seems silly. business' are allowed to advertise prices pre tax which can easily confuse people. Im sure you would get used to it but still, for travellers its annoying.

I think they are at 15% aswell, well Quebec anyway.

vztrt · 21-01-2006, 05:29 PM

Quote:

Originally Posted by ImpulseTaco

I fear the day when the Chinese start exporting cars here.

It woint be for a while. They cant meet the aussie design rule standards.

Quote:

Originally Posted by ImpulseTaco

By the way though, I must say, I really like Oz wine. You guys make some stuff, Yellow Tail, thats pretty good, and at quite a fair price.

That stuff is pretty par with the wine you can get in this country, for the same price or a few bucks more.

Quote:

Originally Posted by deesun

The previous tax was on the wholesale price but GST is on the retail price.
EG.WS $10,000+ 25% tax + 25% mark up = 10,000+2500=12500+ 25%=15625
With GST it is WS 10000+ 25%m/u =12500 +10% GST =13700.But some items only had 10% tax on them so the savings were negligible
EG 10000 +10%tax = 11000 + 25% mu= 13750
or 10000 + 25% m/u = 12500 + 10% GST= 13750= no saving at all. It all depended on what amount of wholesale tax.

So in other words the price of consumer goods was the same before and after but they added a 10% tax on services (like gas, water, elec, etc), which I believe didn't have a tax before??

The GST is a pain if you have your own business. I do my dads BAS quarterly and it annoys the crap out of me. I know it was meant to get rid of the cash society but when you get something done by trades person you offer them cash and they automatically drop their price by 10%. I would assume than that they arn't claiming this on tax and paying less income tax.

pauljh74 · 21-01-2006, 06:10 PM

In reference to cars, yes the tax dropped from around 20% to 10%, but now when you get your car serviced, you pay less tax on parts and pay tax on the labour, which in many cases is higher than the cost of parts.

Overall, the tax burden has shifted so that lower income earners pay a greater portion of their income on GST. On top of that, the revision of tax rates has been barely adequate at best for those on lower incomes of say $40000 or less. Most of the more recent income tax cuts have been given to high income earners and families.
Look at it this way, if it costs $500 a week for a person's typical living budget, and they take home $600/week, spend a typical amount of money on the usual things like food, utilities, running a car, entertainment etc, they will pay a greater portion of their income on GST compared to someone who spends say $700 a week, but earns $1500/week. The previous system scaled up the tax on goods only depending on how much of a luxury they were. This was supposedly more complex to comply with, but most businesses wouldn't argue this now.
Also state taxes like stamp duties should have been abolished, but to add insult to injury, the GST is charged on these taxes as well. Excise should have been wiped out as well, but now we pay more tax than before on certain goods like petrol

pauljh74 · 21-01-2006, 06:15 PM

Quote:

Originally Posted by vztrt

The GST is a pain if you have your own business. I do my dads BAS quarterly and it annoys the crap out of me. I know it was meant to get rid of the cash society but when you get something done by trades person you offer them cash and they automatically drop their price by 10%. I would assume than that they arn't claiming this on tax and paying less income tax.

I would have thought it has increased the cash jobs, as taking cash makes it cheaper for the consumer and reduces paperwork for the businessperson

vztrt · 21-01-2006, 06:26 PM

Quote:

Originally Posted by pauljh74

I would have thought it has increased the cash jobs, as taking cash makes it cheaper for the consumer and reduces paperwork for the businessperson

Thats what I was trying to say. If you offer a tradesperson cash they will take it and give you the 10% discount and not cherge the GST.
Also if they dont charge the GST than I'd assume that it's money not claimed to the government and would reduce the amount of income tax being paid by the individual.

apolloxbgt · 21-01-2006, 06:37 PM

I think that the idea was not to stop cash trade,but they still catch up with you whenever you buy food,booze (insert item here).

b0son · 21-01-2006, 07:34 PM

Quote:

Originally Posted by svo347

well just look at our economy...
how far are we in the black now?

How many public assets have the Libs sold? Telstra, countless govt department buildings.... over $60 billion in the five years up to 2002 alone.

Quote:

from what ive read, exports are down and imports are up......

The only way to boost exports in the short-term is to reduce the value of the aussie dollar. Of course, that drives up import prices, which increases inflation, which raises rates....

b0son · 21-01-2006, 07:39 PM

Quote:

Originally Posted by vztrt

If you offer a tradesperson cash they will take it and give you the 10% discount and not cherge the GST.

They should be offering a lot more than that. How much income tax are they saving??

If someone offers me cash work, I'd be inclined to ask for 25% OR I call the ATO.

b0son · 21-01-2006, 07:43 PM

Quote:

Originally Posted by svo347

No offense taken mate...
the reason theres little manufacturing is because in todays society, its far more cheaper to manufacture items overseas than what it would be to do it here.
Why pay someone $15p/h when theres alot of people willing to do it for $5

$15?? Add superannuation, workers comp, long service leave, loadings, penalty rates, liability insurance, complying with OH&S, deling with industrial relations, etc. It's little wonder manufacturers go offshore.

**Stav** · 21-01-2006, 09:00 PM

THE GST in Australia has been the silent tax which has covered every other tax and made taxless items pre gst taxed.

It is an exponential tax.The guy that charges me collects 10%, then I must slug the end user 10% on top of my sales price. This country has the biggest budgetary surplus in its history,even the economists did not predict it.However in our state for example we have water restrictions due to lack of infrastructure to support the population.Where is the money going? Who knows? Is the gst a good thing?It depends on how decent and intent the government are on putting it to good use.

MO · 21-01-2006, 10:08 PM

Quote:

Originally Posted by useless

THE GST in Australia has been the silent tax which has covered every other tax and made taxless items pre gst taxed.

It is an exponential tax.The guy that charges me collects 10%, then I must slug the end user 10% on top of my sales price. This country has the biggest budgetary surplus in its history,even the economists did not predict it.However in our state for example we have water restrictions due to lack of infrastructure to support the population.Where is the money going? Who knows? Is the gst a good thing?It depends on how decent and intent the government are on putting it to good use.

Well put and so were a few others...I won't get into this debate to much as I could find myself on holiday.

Suffice it to say the GST is a stealth tax and I believe that the others taxes it was s'pposed to get rid of it has'nt...whos fault is this...the state gov's they were s'pposed to drop many taxes and did'nt...whos fault is this the fed gov...'cos they did'nt stomp on the state govs..

Not wishing to hijack the thread but this also has an impact regarding the FTA.

I leave on this note and await progress.

Filthy GT-P · 22-01-2006, 12:49 AM

The biggest problem with a tax like GST is that it is specifically aimed at those that can least afford it, the greater the proportion of your income that you spend the worse off you will be. Low income earners fall into this category and have no ability to get out of it.

The biggest lie that the Australian voters fell for is that at least with a GST the cash economy would be taxed and reduced. Utter Crap, in every economy or jurisdiction in the world where a broad based consumption tax (read GST or VAT) has been introduced the cash economy has exploded, not been brought under control. Australia is no different. If you doubt this statement ask a tradesman what is the price for cash, it will usually be at least the GST component cheaper. The ATO has special units set up to try and track this but in my opinion they are failing dismally.

Some people argue that the GST has no cost for GST registered enterprises, again this is utter crap. Small business owners spend ridiculous amounts of time completing their BAS and they are not reimbursed for their time or expense by the government. The expression that they are unpaid tax collectors falls well short of the mark. In most instances they are paying someone to help them record their collection on behalf of the ATO.

The current tax system is more complex than the one we had previously and is becoming more complex daily. Due to political payola we have ended up with a very complex system and it is unlikely to be simplified. John Howard's promise to us was that during his terms the rate would never increase from the 10% rate. My question to you all is when he leaves politics do you honestly think the rate will remain at 10%, if you do I do have this bridge I could sell you real cheap.

One of the greatest problems with the GST system is to do with used cars. Anyone noticed what has happened with the trade ins you are offered, plummeted. Conversely anyone noticed what has happened to used car prices charged by yards, skyrocketed. This is only one example of the impacts of a GST, there are many more just as unfair as well.

To sum it up in a nutshell, there have been some benefits from the introduction of our current GST system, but currently I believe the problems outweigh the benefits. Our system has a flawed base and will always be flawed until the point it is revoked (fat chance) or fixed (fat chance) until either of these unlikely events occurs both sides of government will continue to p1ss our tax dollars up against a wall, so long as that wall supports their idealogical beliefs.

Regards

Steven

Filthy GT-P · 22-01-2006, 12:50 AM

Don't know why it posted twice, it was bad enough typing it once

22-01-2006, 02:44 AM

As an individual it's no drama and as a small business owner using the ATO's E-record i find it extremely simple and takes very little time to look after.And i use the details from E-record to do my tax also.
I reckons it is simple and easy to use.
One tax percentage for everything.
Use E-record and their online portal and it takes about two minutes to lodge and you get a two week automatic extension as a bonus for doing it online.

ImpulseTaco · 22-01-2006, 08:31 AM

I can't believe they (ATO?) would put such a burden on small business owners. The idea here is that small business owners make up the majority of the economy, and they are some of the most important. Now while our Fed. tax system isn't the simplest, it certainly sounds like its not the most complex, especially in regards to this.

The taxes that small business owners are responsible for is Fed Income, which everyone and anyone pays, except illegals (again, a case of an untracked cash economy) Then a state sales and use tax. Thats about the end of it, unless you're selling something thats subject to some other special type of tax, i.e. guns, cars, cigs/alcohol, fuel, and a handful of others.

Since we're keeping this topic alive, who is property tax; i.e. tax on the house/land you own (is this stamp tax?) paid to? State or Fed or other?
Here, property taxes are paid to the municipality, and they have been skyrocketing; as such there are several tax revolts going on state wide, with alot of incumbents being voted out of office. Any chance of something like this happening for you guys?