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  Reply # 1121072 3-Sep-2014 12:10
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sir1963:
charsleysa:
sir1963:
Geektastic: The most obvious thing to do is lower our tax rates so that no one - corporate or individual - feels they are being extorted. If people think the amounts they are paying are reasonable they are far less likely to spend money on expensive accountancy to try and avoid paying.

Given that companies pay employees who pay tax, pay vehicle taxes for road use, GST for all manner of things and so on it is hard to see what they are actually taxed for at all other than 'just because we can'.


Ireland tried that.... and FAILED.

lets now look at the other assumptions

Employee tax. 2000hr a year @$14 the employee pays $3920 tax, the employer deducts the wage at 28% so gets back $7840.
Companies don't pay GST
Businesses use the police and other emergency services
Businesses use the courts
Businesses use the health system (accidents at work are heavily subsidised)
Businesses benefit from the education system
Businesses benefit from trade agreements

etc etc etc.




Are you trying to say business use all these services without paying for it?

Businesses pay tax at 28%, and the tax they remove from an employee wage/salary goes directly to the IRD.


Nope I am saying business MUST pay taxes, however I do point out that the employer gives $3920 to the IRD as PAYE and then gets back $7840 for minimum wage employees, so the tax payer is out of pocket $3920 per full time minimum wage employee.


The taxpayer cannot be 'out of pocket' - he is not a party to the transaction other than in the form of the company. This peculiar belief that we are somehow entitled to a percentage of someone else's efforts as some sort of right needs to stop.

I presume that if they get the tax back in regard to the PAYE, it will end up at the bottom line and get taxed at company level as profit instead...





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  Reply # 1121075 3-Sep-2014 12:14
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sir1963:
Geektastic:
Dingbatt:
networkn:
Dingbatt:
Geektastic: Corporates pay what they are required to pay. The assumption that we are somehow entitled to expect more of what they earn in the name of 'fairness' just seems wooly headed.

If the Chinese can restrict the number of offspring breeders produce, why can't we?


I concede 'fair' wasn't the correct term to use. And corporates are only one group that use loopholes to reduce their tax burden. It is we poor suckers that pay PAYE that have nowhere to hide. The problem is both the law and the enforcement of it that lets the 4 Billion referenced by BarTender go missing.

As for the chinese, we don't operate that sort of political or societal system. It's just as easy for people with children to look down their nose at childless people as the reverse. Without other people's children who is going to change your adult diaper and wipe the drool off your chin in the old folks home?


Poor suckers paying PAYE? Say what notw You mean contributing members of society?


Yup. Me included. Nowhere to hide, I just wish others had nowhere to hide as well.


I don't pay PAYE and neither does my wife.

If you think we have somewhere to hide, I will send you our Provisional Tax bill from the IRD - based on the assumption that we will increase our turnover by 5% and with 8.4% penalty interest if we underpay - and a mere 1.75% credit interest if we overpay...it's payable in a lump sum every few months. At the end of your first year in business, the IRD will demand terminal tax (the full amount of income tax for the year just ended, in a single lump) PLUS you will begin paying Provisional tax for the year just begun.

Note that you pay the IRD what they tell you you must pay - and if they get it wrong and you make too much money, and hence pay too little Provisional Tax, they will stiff you for 8.4% interest on the underpayment to reward your hard work and effort....

PAYE people have it easy, I can tell you. Running your own business most assuredly does NOT mean you are not a contributing member of society - in fact it means you do a lot of unpaid work for the IRD in addition to paying through the nose.


You missed the part where you claim for a "Home office" where by the house you live in a percentage of the Rates, Mortgage, Power , Maintenance , phone , car , insurances, rubbish bin, lawn mowing, etc etc are deductible (Its worth about $1000 back in my pocket each year). Never mind all the scams some people do like buying a new fridge for the business and then swap it for the old one at home, getting 4 new tyres for the work vehicle at end up on the wifes car. Then there are the work Uniforms (nice new Amani suit...thanks), work related wineing and dining. Hell until I was forced out of using an LAQC, 100% of my cars running costs (petrol, WOF, Insurance etc etc) was deductible even though it was for personal use and then I could claim depreciation on the car too !.


Now as a PAYE earner too, I am paying 39% on my income over 70K, and wage earners get no deductions for anything, nothing for the house, nothing for the car, nothing for work clothes or tools, etc. Where as a business gets all the deductions then then pays a maximum of 28% no matter how much they earn.

However if you are Google etc who use tax loopholes, they pay about 1.4% tax.




They also take all the risks....and potentially stand to lose family homes and all sorts if it goes pear-shaped.

And all these huge companies the lefties like to hate because they are successful employ hundreds of thousands and all started as small companies once.





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  Reply # 1121077 3-Sep-2014 12:16
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sir1963:
Geektastic:
sir1963:
benokobi:
nathan: Raise taxes off all these rich pricks and redistribute it too these poor families who cant say no to having more offspring even though they are already not well off

So the people who made better decisions in life have to pay for others who havent ?


Kids who are hungry (not their fault) do not learn at school
Kids who are hungry are also then ones most disruptive
Kids who are hungry are the ones who are more likely to end up in detention 
Kids who are hungry are more likely to get stood down or expelled.
Kids who are hungry are more likely to become ill
These kids then end up on a benefit, prison or low wage job, a cycle of poverty.


These kids had no choice about being born, being born into a poor family , being born into a home of neglect.

Without choices there can be no decisions.

Feeding these kids so they can learn and do better than their parents is a real threat to the 1%, educated people who have choices want more than minimum wage jobs, part time jobs, dirty jobs. 

Blaming their parents
Does nothing to fix the problem
Does not feed the kids
Does not educate the kids
Does not stop the cycle of poverty

But hey, it makes you feel good knowing someone else is to blame and therefore you have to do nothing about it.


Why don't we just feed the kids at school then? If schools have cafeterias and provide three meals a day (which gives us an opportunity to extend the school day to 1800 so they can get more learning done) for ALL children in ALL schools, won't that just solve the problem?

I had every meal in school from age 7 to 22!!


Because they are too unimaginative to work for themselves. They are a resource, like paperclips.

Why don't we pay the parents a living wage.
Businesses are not automatically entitled to make money, nor make the owner wealthy. So why should wages be pushed down to make a business viable, why should the workers be subsiding the employer ?

Some NZ business are already paying a living wage and have NOT gone broke as all the right wingers claim they will
http://www.stuff.co.nz/business/money/9961603/Living-wage-pays-off-for-business


Because they are too unimaginative to work for themselves. They are a resource, like paperclips.

By the same argument that you make, employees are not entitled to demand ever increasing wages. The end result is that less and less people will bother employing people. I don't - I employ other businesses because I simply do not want the hassle of employees.





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  Reply # 1121104 3-Sep-2014 13:08
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Geektastic:
charsleysa:
sir1963:
Geektastic: The most obvious thing to do is lower our tax rates so that no one - corporate or individual - feels they are being extorted. If people think the amounts they are paying are reasonable they are far less likely to spend money on expensive accountancy to try and avoid paying.

Given that companies pay employees who pay tax, pay vehicle taxes for road use, GST for all manner of things and so on it is hard to see what they are actually taxed for at all other than 'just because we can'.


Ireland tried that.... and FAILED.

lets now look at the other assumptions

Employee tax. 2000hr a year @$14 the employee pays $3920 tax, the employer deducts the wage at 28% so gets back $7840.
Companies don't pay GST
Businesses use the police and other emergency services
Businesses use the courts
Businesses use the health system (accidents at work are heavily subsidised)
Businesses benefit from the education system
Businesses benefit from trade agreements

etc etc etc.




Are you trying to say business use all these services without paying for it?

Businesses pay tax at 28%, and the tax they remove from an employee wage/salary goes directly to the IRD.


Businesses have many employees who earn FAR more than $14/hour. I have not worked for that little since I did odd jobs for my father as a teenager and neither has anyone else I know!

Companies are unpaid tax collectors for GST.

Are you suggesting the courts would vanish if we wound up all the businesses?

Businesses do not use the health system at all. Their employees do.

So what?

So what? With no businesses, why would you even have a trade agreement?

Not all businesses are huge things with millions of dollars slushing through the accounts. Most are very small with very few employees - often none bar the owners - and their cash flows are severely impacted by things like GST, Provisional Tax and so on. 

With no businesses you have nil employment - which is a much greater benefit to society than businesses get in return for a 28% tax bill!!


From NZ statistics
Median hourly earnings are $21.58, so 50% of the workforce earn less than this.
I know a LOT of people on the minimum wage, for a start they work in supermarkets on the checkouts, cleaners in schools, hospitals , businesses 
Businesses deduct a LOT of "expenses" before they pay taxes, in Googles case about 90-95% of their profits go into "fees" so they are paying an effective tax of about 1.4%

Employees get no deductions, when I started work I could deduct my tools of trade, work wear, educational costs, text books etc etc etc

I know of a number of families who pay for their children's tertiary education in the form of a "scholarship" which is then tax deductible , like wise I know of families who paid their kids $20/hr to "sweep the floors" at their business while paying their employees minimum wage.

Businesses DO use the health system, minor work accidents etc get a massive subsidy from the tax payer when the employee goes to the doctor, hospital, etc
They also benefit indirectly though lower absenteeism rates. Businesses are big customers for the police system, I would imagine if they had to pay the police on a per hour basis most crime would not be bothered with as it would be too expensive to solve.

A business is set up by someone who sees an opportunity to make money. If they can't, they won't invest, and that is irrespective of the tax rate.
At 0% takes if you can't make money, you won't invest.
The USA in the 1950s had a corporate tax rate of 50%, yet the economy was more vibrant, had more growth etc etc than it does today at 27%

Businesses live and die by people willing to buy their services/products.
If the minimum wage went up to $20 that would see low income families spending more money on food, clothing, etc. That would see businesses more willing to take on staff, enlarge their business and that had zero to do with the tax rate.
If on the other hand employees wages fall behind inflation, that leaves them less money to spend causing businesses to contract. And if we go into smaller towns that often sees businesses close. No customers = no business.

Now lets look at another scams big business uses.
Insurance. A big business has 20 branches, they figure the worst possible situation would be an event that destroys 1 branch, so what they do is insure say twice that. Lets say each branch is worth $1million, that means they insure up to 2 million in any year. The fire levy which pays for the fire brigade is worked out on this value, so they pay a fire levy for $2million of assets, yet they get the same level of protection for all $20 million. Home owners and small business end up subsiding the big ones.

Wages.
I know of businesses who "pay" their owner a minimum wage, that way they can get money back through Guaranteed minimum family income, independent tax credit , housing support, etc. Hell one even tried using their low income to get a rebate on the council rates.

So, yes business must pay taxes and corporation need to pay far more than they do




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  Reply # 1121107 3-Sep-2014 13:19
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sir1963:
charsleysa:
sir1963:
Geektastic: The most obvious thing to do is lower our tax rates so that no one - corporate or individual - feels they are being extorted. If people think the amounts they are paying are reasonable they are far less likely to spend money on expensive accountancy to try and avoid paying.

Given that companies pay employees who pay tax, pay vehicle taxes for road use, GST for all manner of things and so on it is hard to see what they are actually taxed for at all other than 'just because we can'.


Ireland tried that.... and FAILED.

lets now look at the other assumptions

Employee tax. 2000hr a year @$14 the employee pays $3920 tax, the employer deducts the wage at 28% so gets back $7840.
Companies don't pay GST
Businesses use the police and other emergency services
Businesses use the courts
Businesses use the health system (accidents at work are heavily subsidised)
Businesses benefit from the education system
Businesses benefit from trade agreements

etc etc etc.




Are you trying to say business use all these services without paying for it?

Businesses pay tax at 28%, and the tax they remove from an employee wage/salary goes directly to the IRD.


Nope I am saying business MUST pay taxes, however I do point out that the employer gives $3920 to the IRD as PAYE and then gets back $7840 for minimum wage employees, so the tax payer is out of pocket $3920 per full time minimum wage employee.


Where are you getting these figures from? Why would the business deduct 28% for all employees when there is a set rules they must adhere to?

 

If the business is giving too much money to the IRD in employee deductions then the IRD is going to give back what they overpay or offset their income tax. Taxpayers are not out of pocket because the IRD isn't losing money, in fact the IRD has gained money because of the interest it gains while holding that money.




Regards
Stefan Andres Charsley

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  Reply # 1121342 3-Sep-2014 18:08
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sir1963:
Feeding these kids so they can learn and do better than their parents is a real threat to the 1%, educated people who have choices want more than minimum wage jobs, part time jobs, dirty jobs. 



OK, with that post this thread crossed the boundary from mere blinkered rhetoric into absurdity.

How is having a kid turn up at school, do well, get a good job where they can prosper and pay taxes, and along the way stay off welfare and out of  prison - "a threat to the 1%"? There is no advantage to anyone from this outcome.

There is no dark shadowy conspiracy to crush people, fill up prisons and inflate welfare roles just because they can. Apart from anything else, such an outcome is actually detrimental to the upper-income group, as well as the rest of society.

This thread is now up there with chemtrails, the reptillians and flouridated water being a corporate consipracy to cause aspergers.

Like Dingbatt et al, I'm out of this discussion.

gzt

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  Reply # 1121371 3-Sep-2014 19:23
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It is certainly true that business operators have a better opportunity to structure their and family income and tax affairs to minimise tax and maximise other advantages like access to community service cards etc when compared to PAYE earners. It is a long jump from there to say that all business operators are always at an advantage, or all business operators act with a lack of integrity. We are a long long way from the topic.

The government just announced a $100 million fund to improve water quality related to dairy farms essentially by buying land near waterways iiuc. That should take away a few green votes.

I expect the government to come up with something in relation to the childhood poverty thing to take away a few votes from other parties. It comes up all the time so I would expect it to be addressed specifically.

The national party appointed children's commissioner just challenged the government to set some targets on this issue. (The TVNZ article has a broken link to the related program - Correct link here). I watched the first five minutes only so far, it started by profiling a business woman who is pioneering some solutions so it seemed fairly positive look at the issues and possible solutions. Might get back to it. I have not seen the Campbell Live one.

gzt

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  Reply # 1121442 3-Sep-2014 21:56
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kawaii: Just watching Campbell Live now

On demand is now available. I watched it just now. (10 min)

http://www.3news.co.nz/tvshows/campbelllive/empty-fridges-highlight-kiwi-poverty-2014090119

I did not find it rage inducing in the slightest. The first thing I noticed, the vast majority of fridges were fairly clean. They did not look like fridges of irresponsibility.

I did find myself wondering why they were looking only at fridges. Large root vegetables (potato, kumara, onion) and things like that are not typically kept in fridges. Likewise tinned goods.

I did notice the family of six had some vegetables stored in the fridge. Again, that did not look like a sign of irresponsibility to me. It looked like doing the best you can.

I also watched a follow up article from the next day: (11 min)

http://www.3news.co.nz/tvshows/campbelllive/filling-the-fridges-for-young-kiwis-2014090219

Quoting from the above:

"Manurewa High School principal Salvatore Gargiulo has students that attend his school who come from families that earn a total income of $20,000 and have up to seven mouths to feed. "I don't know how that family would survive on $20,000," says Mr Gargiulo, and these aren't families that smoke, drink or gamble. "Most of our families don't go near that sort of stuff," says Mr Gargiulo "They haven't got any option.""

In contrast a lot of the comments here have discussed irresponsible parenting as the root cause of the majority of this. That is a very big claim to make.

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  Reply # 1121446 3-Sep-2014 22:08
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sir1963:
Geektastic:
charsleysa:
sir1963:
Geektastic: The most obvious thing to do is lower our tax rates so that no one - corporate or individual - feels they are being extorted. If people think the amounts they are paying are reasonable they are far less likely to spend money on expensive accountancy to try and avoid paying.

Given that companies pay employees who pay tax, pay vehicle taxes for road use, GST for all manner of things and so on it is hard to see what they are actually taxed for at all other than 'just because we can'.


Ireland tried that.... and FAILED.

lets now look at the other assumptions

Employee tax. 2000hr a year @$14 the employee pays $3920 tax, the employer deducts the wage at 28% so gets back $7840.
Companies don't pay GST
Businesses use the police and other emergency services
Businesses use the courts
Businesses use the health system (accidents at work are heavily subsidised)
Businesses benefit from the education system
Businesses benefit from trade agreements

etc etc etc.




Are you trying to say business use all these services without paying for it?

Businesses pay tax at 28%, and the tax they remove from an employee wage/salary goes directly to the IRD.


Businesses have many employees who earn FAR more than $14/hour. I have not worked for that little since I did odd jobs for my father as a teenager and neither has anyone else I know!

Companies are unpaid tax collectors for GST.

Are you suggesting the courts would vanish if we wound up all the businesses?

Businesses do not use the health system at all. Their employees do.

So what?

So what? With no businesses, why would you even have a trade agreement?

Not all businesses are huge things with millions of dollars slushing through the accounts. Most are very small with very few employees - often none bar the owners - and their cash flows are severely impacted by things like GST, Provisional Tax and so on. 

With no businesses you have nil employment - which is a much greater benefit to society than businesses get in return for a 28% tax bill!!


From NZ statistics
Median hourly earnings are $21.58, so 50% of the workforce earn less than this.
I know a LOT of people on the minimum wage, for a start they work in supermarkets on the checkouts, cleaners in schools, hospitals , businesses 
Businesses deduct a LOT of "expenses" before they pay taxes, in Googles case about 90-95% of their profits go into "fees" so they are paying an effective tax of about 1.4%

Employees get no deductions, when I started work I could deduct my tools of trade, work wear, educational costs, text books etc etc etc

I know of a number of families who pay for their children's tertiary education in the form of a "scholarship" which is then tax deductible , like wise I know of families who paid their kids $20/hr to "sweep the floors" at their business while paying their employees minimum wage.

Businesses DO use the health system, minor work accidents etc get a massive subsidy from the tax payer when the employee goes to the doctor, hospital, etc
They also benefit indirectly though lower absenteeism rates. Businesses are big customers for the police system, I would imagine if they had to pay the police on a per hour basis most crime would not be bothered with as it would be too expensive to solve.

A business is set up by someone who sees an opportunity to make money. If they can't, they won't invest, and that is irrespective of the tax rate.
At 0% takes if you can't make money, you won't invest.
The USA in the 1950s had a corporate tax rate of 50%, yet the economy was more vibrant, had more growth etc etc than it does today at 27%

Businesses live and die by people willing to buy their services/products.
If the minimum wage went up to $20 that would see low income families spending more money on food, clothing, etc. That would see businesses more willing to take on staff, enlarge their business and that had zero to do with the tax rate.
If on the other hand employees wages fall behind inflation, that leaves them less money to spend causing businesses to contract. And if we go into smaller towns that often sees businesses close. No customers = no business.

Now lets look at another scams big business uses.
Insurance. A big business has 20 branches, they figure the worst possible situation would be an event that destroys 1 branch, so what they do is insure say twice that. Lets say each branch is worth $1million, that means they insure up to 2 million in any year. The fire levy which pays for the fire brigade is worked out on this value, so they pay a fire levy for $2million of assets, yet they get the same level of protection for all $20 million. Home owners and small business end up subsiding the big ones.

Wages.
I know of businesses who "pay" their owner a minimum wage, that way they can get money back through Guaranteed minimum family income, independent tax credit , housing support, etc. Hell one even tried using their low income to get a rebate on the council rates.

So, yes business must pay taxes and corporation need to pay far more than they do





You still haven't really explained why businesses, which provide more or less 100% of the employment in society, should pay tax for the privilege of doing that....





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  Reply # 1121449 3-Sep-2014 22:10
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gzt:
kawaii: Just watching Campbell Live now

On demand is now available. I watched it just now. (10 min)

http://www.3news.co.nz/tvshows/campbelllive/empty-fridges-highlight-kiwi-poverty-2014090119

I did not find it rage inducing in the slightest. The first thing I noticed, the vast majority of fridges were fairly clean. They did not look like fridges of irresponsibility.

I did find myself wondering why they were looking only at fridges. Large root vegetables (potato, kumara, onion) and things like that are not typically kept in fridges. Likewise tinned goods.

I did notice the family of six had some vegetables stored in the fridge. Again, that did not look like a sign of irresponsibility to me. It looked like doing the best you can.

I also watched a follow up article from the next day: (11 min)

http://www.3news.co.nz/tvshows/campbelllive/filling-the-fridges-for-young-kiwis-2014090219

Quoting from the above:

"Manurewa High School principal Salvatore Gargiulo has students that attend his school who come from families that earn a total income of $20,000 and have up to seven mouths to feed. "I don't know how that family would survive on $20,000," says Mr Gargiulo, and these aren't families that smoke, drink or gamble. "Most of our families don't go near that sort of stuff," says Mr Gargiulo "They haven't got any option.""

In contrast a lot of the comments here have discussed irresponsible parenting as the root cause of the majority of this. That is a very big claim to make.


"fridges of irresponsibility"

My Mage casts a Level 6 Fridge of Irresponsibility! (With a nod to E Gary Gygax)





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  Reply # 1121451 3-Sep-2014 22:11
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gzt: It is certainly true that business operators have a better opportunity to structure their and family income and tax affairs to minimise tax and maximise other advantages like access to community service cards etc when compared to PAYE earners. It is a long jump from there to say that all business operators are always at an advantage, or all business operators act with a lack of integrity. We are a long long way from the topic.

The government just announced a $100 million fund to improve water quality related to dairy farms essentially by buying land near waterways iiuc. That should take away a few green votes.

I expect the government to come up with something in relation to the childhood poverty thing to take away a few votes from other parties. It comes up all the time so I would expect it to be addressed specifically.

The national party appointed children's commissioner just challenged the government to set some targets on this issue. (The TVNZ article has a broken link to the related program - Correct link here). I watched the first five minutes only so far, it started by profiling a business woman who is pioneering some solutions so it seemed fairly positive look at the issues and possible solutions. Might get back to it. I have not seen the Campbell Live one.


It is also true that more or less everyone has the opportunity to start a business. 







gzt

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  Reply # 1121457 3-Sep-2014 22:26
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Geektastic: It is also true that more or less everyone has the opportunity to start a business.

For some reason that reminds me of something an accounts person I knew was advising me for some reason or other. I forget exactly why. But it went something like this:

0. Start 'business'
1. Buy a car.
2. Get a post office box for your company.
3. Drive car to post office box every day to check if mail arrived.
4. Put this in the log book for the car.
4.5 (do your personal shopping etc, etc)
5. Presto! claim GST, deductibility for fuel, tax loss, etc, etc.
6. Presto! tax deductible car and fuel costs for your personal use!

Edit: Actually #3 may have been entirely optional in this scheme. I got the impression from the way it was told that it was an 'everybody knows this' kind of a thing ; )

Also, Dude, please ease up on the 100% quoting. This topic has been entirely unreadable in places.

Edit: Disclaimer: This should not be seen as a criticism of company cars legitimately operated within the 80/20 rule. ; ).

Edit: Darn it I replied without thinking to your off topic and went further off topic ; ) But this is just too good to delete. Sorry world of net.

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  Reply # 1121491 4-Sep-2014 01:10
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gzt: 
"Manurewa High School principal Salvatore Gargiulo has students that attend his school who come from families that earn a total income of $20,000 and have up to seven mouths to feed. "I don't know how that family would survive on $20,000," says Mr Gargiulo, and these aren't families that smoke, drink or gamble. "Most of our families don't go near that sort of stuff," says Mr Gargiulo "They haven't got any option.""

In contrast a lot of the comments here have discussed irresponsible parenting as the root cause of the majority of this. That is a very big claim to make.

how does a couple decide to bring 5 children to this world on a 20k income is beyond me. having kids would be the last thing in my mind even if I have just myself to feed on 20k.

and I've yet to see the detailed figures. there is no way the family of 7 earn a total income of $20k - that means between the parents they don't even get 30 hours of work pw on minimum wages. let's just assume 1 is working 30 hours pw, 5 children under 13, the wwf alone would bring in another $537 a week, not to mention Accommodation Supplement ($165 pw in Auckland south and not in a state house), Childcare Assistance and other benefits
http://www.ird.govt.nz/calculators/keyword/wff-tax-credits/calculator-wfftc-estimate-2013.html 

that's $702 pw, or $36.5k pa, tax free on top of their $20k "income", which is more like $72k before tax pa.

provided it's still not a lot to raise 5 kids, it's definitely far from the claimed figures of "total income of $20k and up to 7 mouths to feed".

show me their budget, all income streams, all expenses. as I said, if true hardships are identified, I'd like to see they receive more tax payer help.

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  Reply # 1121529 4-Sep-2014 08:21
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Geektastic:
sir1963:
Geektastic:
charsleysa:
sir1963:
Geektastic: The most obvious thing to do is lower our tax rates so that no one - corporate or individual - feels they are being extorted. If people think the amounts they are paying are reasonable they are far less likely to spend money on expensive accountancy to try and avoid paying.

Given that companies pay employees who pay tax, pay vehicle taxes for road use, GST for all manner of things and so on it is hard to see what they are actually taxed for at all other than 'just because we can'.


Ireland tried that.... and FAILED.

lets now look at the other assumptions

Employee tax. 2000hr a year @$14 the employee pays $3920 tax, the employer deducts the wage at 28% so gets back $7840.
Companies don't pay GST
Businesses use the police and other emergency services
Businesses use the courts
Businesses use the health system (accidents at work are heavily subsidised)
Businesses benefit from the education system
Businesses benefit from trade agreements

etc etc etc.




Are you trying to say business use all these services without paying for it?

Businesses pay tax at 28%, and the tax they remove from an employee wage/salary goes directly to the IRD.


Businesses have many employees who earn FAR more than $14/hour. I have not worked for that little since I did odd jobs for my father as a teenager and neither has anyone else I know!

Companies are unpaid tax collectors for GST.

Are you suggesting the courts would vanish if we wound up all the businesses?

Businesses do not use the health system at all. Their employees do.

So what?

So what? With no businesses, why would you even have a trade agreement?

Not all businesses are huge things with millions of dollars slushing through the accounts. Most are very small with very few employees - often none bar the owners - and their cash flows are severely impacted by things like GST, Provisional Tax and so on. 

With no businesses you have nil employment - which is a much greater benefit to society than businesses get in return for a 28% tax bill!!


From NZ statistics
Median hourly earnings are $21.58, so 50% of the workforce earn less than this.
I know a LOT of people on the minimum wage, for a start they work in supermarkets on the checkouts, cleaners in schools, hospitals , businesses 
Businesses deduct a LOT of "expenses" before they pay taxes, in Googles case about 90-95% of their profits go into "fees" so they are paying an effective tax of about 1.4%

Employees get no deductions, when I started work I could deduct my tools of trade, work wear, educational costs, text books etc etc etc

I know of a number of families who pay for their children's tertiary education in the form of a "scholarship" which is then tax deductible , like wise I know of families who paid their kids $20/hr to "sweep the floors" at their business while paying their employees minimum wage.

Businesses DO use the health system, minor work accidents etc get a massive subsidy from the tax payer when the employee goes to the doctor, hospital, etc
They also benefit indirectly though lower absenteeism rates. Businesses are big customers for the police system, I would imagine if they had to pay the police on a per hour basis most crime would not be bothered with as it would be too expensive to solve.

A business is set up by someone who sees an opportunity to make money. If they can't, they won't invest, and that is irrespective of the tax rate.
At 0% takes if you can't make money, you won't invest.
The USA in the 1950s had a corporate tax rate of 50%, yet the economy was more vibrant, had more growth etc etc than it does today at 27%

Businesses live and die by people willing to buy their services/products.
If the minimum wage went up to $20 that would see low income families spending more money on food, clothing, etc. That would see businesses more willing to take on staff, enlarge their business and that had zero to do with the tax rate.
If on the other hand employees wages fall behind inflation, that leaves them less money to spend causing businesses to contract. And if we go into smaller towns that often sees businesses close. No customers = no business.

Now lets look at another scams big business uses.
Insurance. A big business has 20 branches, they figure the worst possible situation would be an event that destroys 1 branch, so what they do is insure say twice that. Lets say each branch is worth $1million, that means they insure up to 2 million in any year. The fire levy which pays for the fire brigade is worked out on this value, so they pay a fire levy for $2million of assets, yet they get the same level of protection for all $20 million. Home owners and small business end up subsiding the big ones.

Wages.
I know of businesses who "pay" their owner a minimum wage, that way they can get money back through Guaranteed minimum family income, independent tax credit , housing support, etc. Hell one even tried using their low income to get a rebate on the council rates.

So, yes business must pay taxes and corporation need to pay far more than they do





You still haven't really explained why businesses, which provide more or less 100% of the employment in society, should pay tax for the privilege of doing that....



Because without those businesses most jobs would still more or less be required and people would simply be self employed.
Those businesses can also be collective, shareholder owned and operated, charities.
Businesses are NOT the only way groups of people bind together for a collective goal

Businesses directly benefit from a healthy, educated workforce, they benefit directly from law and order etc and there are many areas where they benefit indirectly too, New Zealand being for example the least corrupt country in the world, hell without rules and laws the share market would collapse simply because no one could trust it.

Businesses benefit from a stable effective government and rule of law. Of course they should pay for it. Unless of sours you want businesses exempt, so yo get burgled , YOUR problem, no police will be involved, you are outside of the rule of law. Someone torches your property, YOUR problem, you are outside the rule of law.Do you really want to be in a place where you are forced to pay bribes and protection money.


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  Reply # 1121550 4-Sep-2014 08:49
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gzt:
Geektastic: It is also true that more or less everyone has the opportunity to start a business.

For some reason that reminds me of something an accounts person I knew was advising me for some reason or other. I forget exactly why. But it went something like this:

0. Start 'business'
1. Buy a car.
2. Get a post office box for your company.
3. Drive car to post office box every day to check if mail arrived.
4. Put this in the log book for the car.
4.5 (do your personal shopping etc, etc)
5. Presto! claim GST, deductibility for fuel, tax loss, etc, etc.
6. Presto! tax deductible car and fuel costs for your personal use!

Edit: Actually #3 may have been entirely optional in this scheme. I got the impression from the way it was told that it was an 'everybody knows this' kind of a thing ; )

Also, Dude, please ease up on the 100% quoting. This topic has been entirely unreadable in places.

Edit: Disclaimer: This should not be seen as a criticism of company cars legitimately operated within the 80/20 rule. ; ).

Edit: Darn it I replied without thinking to your off topic and went further off topic ; ) But this is just too good to delete. Sorry world of net.


I'd love to reduce the 100% quote thing but every time I alter the quoted text I get some BS about 'tags' and it won't post...!





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