From: c.oneill@trl.oz.au (Chris O'Neill)
Subject: Re: Vic Ministers Get $20,000 pay rise.
Organization: Telecom Australia Research Laboratories, Melbourne, Australia
Date: Fri, 6 Nov 1992 04:40:38 GMT

In article <1992Nov6.011445.14023@monu6.cc.monash.edu.au>
suter@fawlty8.eng.monash.edu.au (Mr D. Suter) writes:
>In article <1992Nov5.234724.12932@trl.oz.au> c.oneill@trl.oz.au (Chris
O'Neill) writes:
>>What we have set out to do is test the hypothesis that Liberal governments
are
>>usually only fair to the rich.  The $100 house tax is evidence that confirms
>>that hypothesis.
>The $100 tax is less fair to the poor than most other taxes. We agree.
>The petrol tax is less fair to the poor than most other taxes. We agree.
>The $100 tax is less fair to those that own houses than those that rent.
>We agree.

Under the assumption that the landlord does not wish to maintain his level of
return on investment.  I don't agree with this assumption.

>At the end of the day. Those are the agreed facts. Moreover, the pyramid
>petrol tax cost the vast majority of victorians (including the poor
>who don't own a house) around about $33 per year while the $100 tax
>will only cost them what trickles down in higher rents. We agree that is going
>to be marginal in the short term because of the rental market. If you want
>to argue that they will pay almost the same in the long term because
>the "rich always pass it on" then you must accept that the whole basis
>of your argument is moot because any higher tax on the rich will
>then be passed on to the poor. 

Really.  You must be friends with Ronald Regan.  This $100 per house tax is a
tax affecting an investment which is not applied to other investments.  Other
investments continue to give the same rate of return regardless of this tax. 
To maintain the same level of supply of rental property, the after tax return
must stay the same.  There are other ways of taxing rich people than taxing
their investments.  These other taxes do not affect the market position of
their investments.

>I also suggest that its much easier
>to escape the flow on effects of a ONE OFF charge 

so it only applies this year?

>to a depressed market
>than a continual charge that impacts directly the cost of every
>goods and service (petrol).
>Thus I am sure that any *reasonable person* would see the *evidence* this
>way:
>                    Poor who rent       Poor who buy           Rich
>Labor tax (petrol)   $33 per year (ave)   (33 year average)  (33 per year ave)

It takes you a long time to realize that the amount of petrol people buy is
influenced by how well off they are.

>     (Pyramid only)    ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
>                         Per Driving PERSON NOT household.
>
>Liberal             Virtually zero        $100               $100
>If we have two *poor* people buying a house and both driving to work
>then they pay $66 per year AVERAGE.

How about a bit of consideration for people who either don't have any work to
drive to or who don't work anymore.

>If we have two *poor* people renting and driving then they pay no
>tax under Libs tax but same under Kirners.
>Given that the majority of the really poor are at the left (pun?) end then I
>can't see how you can claim a definite *HUGE* bias either way. 

Well the petrol tax is already pretty regressive and just about at the limit of
regressiveness that governments can get away with without too much hostility. 
It's also easier to get away with because many other consumption taxes follow a
similar regime (and have a similar regressiveness).  However, a $100 per house
tax goes beyond this in regressiveness.  It is simply more regressive than what
we are used to and what is necessary and this justifies the hostility.

>Now if you are only saying that the $100 tax is not as wise as they could have
>chosen, then we agree. I trust we also agree that Kirner was also not
>as wise in her petrol tax.

Well what other taxes were available?

>However, if you want to threshold this
>evidence to make your global statment that the Libs
>are usually only fair to the rich, then, gain, you see only black and white.

I just wanted to show that it was evidence.  If you want to call it black and
white evidence....

Chris O'Neill
Newsgroups: aus.religion