GST

I simply cannot believe they want to raise the rate of GST. It’s just so easy to divide things by ten…

I think we all have to accept that as our economy gets more and more productive that the overall rate of taxation will just keep rising (see plot below) for a whole bunch of reasons but primarily because (a) we don’t really need all that extra wealth, (b) it’s a great means of redistributing wealth, and (c) more tax equals more control and power for those egocentric weirdos that go into politics.

You don’t hear any of them saying let’s just spend less. Or let’s just cap health and educations spending as a % of GDP and work within that budget for the best outcome.

Given that taxes have to rise (forever) me-thinks the best tax to raise would be state property stamp duty. I would make it 20% for residents and as high as 50% for foreign buyers (we may as well fleece them).

Oddly these high figures wouldn’t affect house prices too much. People spend up to their specific budget limit on a property and they don’t care who gets their money, the former owner or the government.

What this means is that house prices in the city are just about completely set by supply & demand, and budget limits. The prices have absolutely nothing to do with any inherent value of the land and very little to do with the true cost of the building.