Why don't the politicians and former Treasury Secretary Ken Henry be honest and tell the market why they really want a super mining tax? How can a government determine the basis of calculating a super profit is and why would it only apply to mining companies and not banks who make super profits by gearing the use of bank deposits to earn REAL SUPER PROFITS. I'm not saying it should be illegal or unfair or excessive to make super profits in banking or mining, but why or how would government decide or calculate a super profit?
The reality I suggest is that with so many foreign companies taking over mining companies there is a real risk that corporate tax take is going to disappear through price transfer arrangements to the new owners country of origin. I'm suggesting the only way to combat this problem is for the States to increase Royalties, which would favour the mining states...thus causing the federal taxing dilemma.
What do you think?
We get so many gloom and doom experts making so many predictions that the Australian property market will experience a massive collapse very soon similar to the USA market did..
My view is that the Australian property market is different than in USA because the USA is not so generous towards its own poor.
From a simplistic point of view there are possibly two main reasons why the property market could decline, the first being if the RBA decides to increase interest rates or keep them too high for too long or if any new incoming coalition of politicians decide to cut welfare and rent assistance for Centrelink clients. The USA does not appear to support its lower income or no income citizens in any way near as our generous politicians support of our people. Property prices are to some extent underpinned by several million government welfare recipients using their Centrelink benefits in true Keynesian style by renting housing and buying food and utilities.
Can you imagine the effects on the banks asset backing if we where to get a crazy government which would suddenly cut the rent assistance benefit in Australia. I dont believe those people including many of our politicians who own units and houses fully understand what would happen to the value of their assets if this were to occur.... each time they complain they are supporting the poor through their taxes..Their own wealth is underpinned by government welfare and they just dont get it.
The reality is the everybody rich and poor relies on government welfare to be maintained and not be fiddled with.
