Say What Wednesdays

Shorten vs Morrison

Government “Spending”

  • Everything is portrayed as a ‘cost’, which is ironic.
  • “Costs” from the Government’s perspective is simply NOT charging you tax. Not taking all income earned is a trillion-dollar cost to them.

 

Shorten’s Policies

Lowering 50% CGT discount to 25% (for assets purchased after 1 July 2017)

  • People will potentially hold onto assets longer because they will be taxed so much if they were to sell.

Negative Gearing – Removal of negative gearing (grandfathering existing)

  1. (ABS Stats) 21% of households own a second home as an Investment property
    • 35% of dwellings are investment properties (rental properties)
  2. Can’t offset more tax than is paid
    • What if property is not rented for a while?
    • People may not buy highly leveraged – high growth properties
    • What if rates go up? A lot of properties in the past were negatively geared
    • Depreciation already gone, property may become less attractive
    • Less incentive for investors to hold an investment property, less available to renters, so therefore with the decreased supply the price of rent increases.

Family Trusts

  1. Implement a 30% floor on the taxation that applies to distributions made by discretionary trusts
  2. Distributions cost $3.5bn to government in lost tax revenue

The removal of Franking Credits

  1. Australian Market – unfranked 5.5% to 6.5% dividend yield on major bank stocks still smashes the 1.8% yield on US equities
  2. Change of company behaviour
    • The American model – Reinvestment of funds is better for companies than double taxation of income for shareholder (reduced shareholder value)
  3. Remember, the Government might say that this is costing them money, but really, it’s just money that they aren’t able to collect in taxes!

Health Funding – additional $2.8 billion funding for hospitals

  1. Additional money doesn’t equal additional efficiency, it depends on how the money is spent. Throwing extra money at a problem doesn’t necessarily solve it. For example, the hospital in Adelaide.
  2. Help reduce emergency department and elective surgery waiting times and provide more beds, doctors and nurses

Education

  1. Scrap upfront fees for 100,000 TAFE students and to spend $100 million modernising TAFES around the country.
  2. Promised about 200,000 extra places at universities
  3. He did not give a costing for the extra university places

Increased funding for even further regulation and red tape

  1. ASIC – lambasted the Government for cutting funds to AISC as a “disgrace” and “immoral” and pledged a $25 million taskforce for public prosecutors
  2. ASIC has gone industry funded – their revenue has gone up and just moved away from tax payer funding

How all of this can be funded?

  1. Can afford the extra spending because he would not “spend” $80 billion on big business tax cuts.
  2. Extra government spending enabled by this revenue-raising – think back to past public works programs, like the NBN or pink batts, or solar panels

Morrison  

  1. Retirement age to 67, not increasing to 70.
    • Whilst it’s not nice to have to increase the eligibility age for the pension, life expectancy has increased by 25 years since the age pension was introduced…and eligibility age has only gone up by 2 years.
  2. Cuts for small and medium businesses will cost up to $3.6 billion over four years
  3. $7.6bn on infrastructure spending
    • Increasing rails and road networks etc
  4. Not sure about what the details or other polices are – nothing is clear at this stage.

 

Say What Wednesday: The relationship between shares and property in Australia

Say What Wednesday The relationship between shares and property in Australia Welcome to Finance and Fury’s ‘Say What Wednesday’. Today’s question is from John. John asks, “What is the relationship (if any) between shares and property in Australia? Should we expect the...

9 reasons your loan may have been rejected

Episode 38 9 reasons your loan may have been rejected Welcome to Finance & Fury. Today we’re talking about 9 reasons you may have your home loan application declined. We have Jayden Vecchio this episode running through the 9 reasons. As a result of the recent Royal...

Understanding foreign currency

Episode 31 Understanding foreign currency Welcome to Finance and Fury. Before I start I want to say a massive ‘Thank you’ to our listeners. We cracked 150k downloads in the first 6 months which is phenomenal. Also, thank you to everyone who has taken up the course – I...

Gender pay gap, porn, and becoming “in demand”

Episode 1 Gender pay gap, porn and becoming "in demand" Welcome to the first episode of Finance and Fury and today we're going to be setting the scene for the rest of the podcast. The whole podcast is about helping to solve misunderstandings… and one really big one is...

Buying Property & Financial-Crash proofing your investments: how to get yourself into a position to survive any market correction

Episode 10 Buying Property & Financial-Crash proofing your investments: how to get yourself into a position to survive any market correction Financial-Crash proof your investments This is a flow on from the last Say What Wednesday, this episode talks about how to get...

Furious Fridays: What should the government be involved in?

Hi Guys and welcome to Finance and Fury the Furious Friday edition. This is part 7, the last episode of the miniseries about all things politics. Sorry it took a while to cover, I wanted to do this topic justice and explain all the steps and outcomes instead of...

Furious Friday: The centralisation of power and control of the economy

Furious Fridays The centralisation of power and control of the economy Last Friday we looked at the stock market crashes of 1907 and 2008 Difference between them was the crash of 1907 had no intervention by any central bank in the USA – because no central bank...

Bonds; How do they work, when do they increase in value and how do they fit into your portfolio?

Episode 20 Bonds; How do they work, when do they increase in value and how do they fit into your portfolio? Today’s episode stems from the question last week from William about investment bonds (an investment vehicle, kinda like a life insurance product). Today...

Is money the root of all evil? And, how statistics are used to perpetuate misunderstandings and f*ck with you

Furious Friday Is money the root of all evil? And, how statistics are used to perpetuate misunderstandings and f*ck with you Welcome to Furious Friday – These episodes aim to solve misunderstandings In this episode -  Furious about the muckery of statistics used to...

Say ‘What’ Wednesdays: Is it time to jump ship? Should you sell your bank shares?

Say 'What' Wednesday Is it time to jump ship? Should you sell your bank shares? Today’s question comes from Jake. He asks “should I sell my bank shares, given the recent fall out from the royal banking commission?” IMPORTANT: This episode comes with a general advice...

Pin It on Pinterest

Share This