Tax, Spending and Governance
It was Benjamin Franklin who said, ‘In this world nothing is certain but death and taxes.’ Will Rogers responded: ‘Yes, and the only difference between death and taxes is that death does not get any worse every time parliament sits.’
Income tax, company tax, payroll tax, petrol tax, GST, the Medicare levy, the emergency services levy, natural resources management levy, the so-called “Save the River Murray levy” … on it goes. Governments, State and Federal, hit us at every turn. The capacity of politicians and public servants to spend our taxes knows no bounds.
We wouldn't mind if our taxes went on improving roads, hospitals, schools, Aboriginal communities, disability services, homelessness and law and order, but it doesn't. Give another billion dollars to any of these departments and it is immediately gobbled up by building the bureaucracy - new offices, more staff, higher pay, and more cars. But not better services on the wards, in the classrooms or on remote communities.
Family First believes in small government with minimal interference in family and community life. As a general rule, we oppose new tax measures and new spending measures. We aim to reduce the size of government so that money is in the pockets of families, communities and business to spend their own money – not Governments spending it on their pet projects.
If the Australian tax system is to offer incentives to be productive, to expand activities, to shift from welfare to work, to pay tax and invest in the future then it must be simple, flat and, in the eyes of tax payers, a fair system.
Family First supports a flat tax system applying the same rate of taxation across the community and without discrimination between businesses, individuals or differing income levels. The more variations in tax policy that apply, the more practices and mechanisms are designed to avoid tax – working for cash to ‘escape the tax man’ through convoluted trust arrangements to multinational corporations resorting to tax havens to minimize local tax liability.
We need clear Federal tax and legal responsibilities. Those who spend the money, should raise the money. Far too often, Federal, State and Local Governments interfere in each other’s cash-flows and jurisdictions for short-term political gain. Federal rebates designed to offset the punitive impact of State or Local Government taxation should cease. The same level of Government that imposes a tax, levy or charge ought also to fund the exemptions to the same.
To that end, a review of the taxation powers of the Commonwealth, States, Territories and local government is welcome. Responsibility for spending must be allocated and kept at one level of government, without duplication. Health and education, for instance, should only be State & Territory responsibilities, and no Federal or local government spending should occur in that era. Accordingly, the States’ power to raise taxes to pay for those costs must be adjusted accordingly, and proportionately reduced or raised at the other levels of Government.
Family First supports the Federation, and having strong States and Territories. The Commonwealth has expanded by too much – both in the taxation revenue it demands, and the amount that it spends. Family First rejects centralised power and supports decentralised power and decision making. The Federation of States and Territories provides the competitive and innovative forces necessary for a healthy democracy and economy.
All levels of government should carry adequate insurance to meet the cost of natural disasters or unforeseen events. It is unacceptable for one State, Territory or other level of government to seek aid from the Commonwealth or taxpayers due to its failure to adequately insure against risk. Governments also have a duty of care in the discharge of their public duties, and should carry adequate insurance against the risk of civil litigation or class actions.
Family First supports the existence of autonomous small, local Councils, particularly in regional areas. We do not support Commonwealth interference in local government via direct funding, bypassing states. For that reason Family First does not support constitutional recognition of local government, as these are or should be recognised at State level, the proper pathway for funding support to local councils. Ideally, Councils should not interfere in areas of state or federal legislative responsibility, such as health and education, and should have responsibility of raising the revenue they need to meet their legislative responsibilities without state or federal support.
Articles of Interest
Can Government quit spending?
[Des Moore, reproduced with permission.]
'A Hateful Tax': Section 90 of the Constitution
[Sir Harry Gibbs]
Federal Renewal, Tax Reform and the States
[Brian Galligan, reproduced with permission.]