I find it very hard not to feel angry about the unfairness, and intransigence of the wealthy in this country.
Why should I work so hard, to get so little, when these people have a leg up on everything. And I don’t count myself as that bad off, in fact I’m, overall, goin pretty well.
This is very misleading. The CGT discount is there to account for inflation. If I buy shares today and sell them in a year for 6% more (a normal yearly gain) I have not actually gained 6% in buying power. There might have been 3% inflation in that time, so I’ve really made 3% profit (in terms of increased buying power)
The CGT discount is not some gift to rich people, it’s an attempt to make the system fair when we have inflation every year.
Wrong, the real reason the CGT discount exists is because it’s a tax on wealth. My uncle, who makes 100k+ a week through owning houses ‘earns’ almost all of it as capital gains. Me as a worker pleb get almost all of my income via wages. I pay income tax, he pays CGT. Further, as a regular worker, a large percentage what I make is spent on goods and services which is subject to GST. He spends more than me on goods and services for sure but as an overall percentage of what he ‘makes’, it’s very small. Most of his wealth gets reinvested into properties, not subject to GST.
Both of these policies were introduced in 1999 by the Howard government and the intent is clear. To regress our tax system and shift the tax burden away from the wealthy.
Your uncle who makes 100k per week through properties would mostly receive that as income from rent. Unless he’s selling a property every week. Income from rent is taxed the same as your income from your job. There is no CGT discount on income.
Employees work a couple of weeks, the then get paid. Inflation doesn’t affect this. It’s the time period of investments (years) that means inflation is a big part of the nominal growth.
Sure, but I don’t work for just a couple of weeks. My salary doesn’t increase with inflation or even with the business prices which may rise with inflation - our industry union is trying to get our annual pay to adjust to CPI at minimum, and good bloody luck to us (I’m doing my part). My coworkers and I are still losing buying power with inflation.
That’s an argument for tax brackets to be indexed with inflation, and for your company to pay more fairly. It has nothing to do with the CGT discount.
True, and I’ll also say that the vested shares not going to workers if they leave or are fired is terrible, companies doing that is absurd. They’re effectively doing the first few years on 2/3 or 1/2 pay, in an industry where I wouldn’t trust them to employ certain roles for more than a few years.