In the Beginning:
        To really understand the Philosophy of Tax it is sometimes best to start at the very beginning. Tax did not just happen recently, but grew from small seeds to the giant industry that it is today.

        Tax is generally boring to those who don't pay Tax, pay very little or have no need to TaxPlan. If you or your family are rich and wealthy and pay 47% + of your marginal Taxable Income up to $100,000 per annum to the Australian Tax Office that's Heroic.

        But if you would prefer to be Patriotic, Rich and create Family and National Wealth - and pay no tax - or perhaps very little - read on. ----

        You do have the "Freedom of Choice" and in particular, the Taxation "Choice Principle" within ATO Part IVA to help you consider your three options - (1) pay tax or (2) create the Wealth of our Nation or (3) a bit of both. Your other option is to evade tax - but you can go to gaol for that.

       Attitudes at Age Five:  

        (If You Want to be Rich and Wealthy, Don't go to School)

        If we look back on our childhood we can readily identify the kids who would be Controllers, Critics and Creatives. By the age of five, after pre-school, where he learnt all he "need to know", a child's attitude has already manifest itself.

        It is here that society probably makes its first and possibly, it's worse blunder.

         At age five we send our creative children off to school. They learn the Rules and Regulations of Control and the debating "ethics?" of Criticism and other "nice to know" subjects. 

     This is fine for future Controllers and Critics, but it inhibits the kids who prefer their basic Creative and Entrepreneurial instincts.

     Civilisations don't advance by rules and criticism but by the ingenuity of its Creative Artisans. In fact most empires have disintegrated when Control and Criticism has polluted and destroyed the Creative capabilities of it's Artists, Artisans, Farmers etc.

     "It wont get off the Ground, Orville"       (but They got Us to the Moon and Back)

      Imagine, if you will, the kids at school with Orville and Wilber Wright. Everyday the Controller types would persist in trying to have them march to the sound of their drum. The Critics, meanwhile, would discourage them with "It wont get off the ground, Orville".

      Controllers out of Control:
      Imagine, if you will, a policeman schooled in the Control of kids and other criminals, almost from birth, progressively becoming a drug Entrepreneur within the criminal industry. Law and order out of Control.

      Attitude's Reward:
      Each attitude or characteristic has it's own fundament rewards.

     The Controller has a compulsive need for compliance - and most poor people comply or else.

     The Critic craves agreement for his argument - and John Laws thanks the poor kindly.

     The Creative needs Customers to buy his goods and/or services and so makes a profit.

 So! What has this to do with TaxPlanning?

     Way back when, it became obvious to the Controllers of any society that  it might dispense with most Controllers' desire for compliance and Critics' craving for agreement. It was an ill chosen venture to antagonise those who Create and produced the food and other necessary items not normally found free at arms length or closer.

    The obvious would be to give special Tax Minimising treatment to those who Create the "Goods and Services". Farmers, Manufacturers, Miners, Merchants, Wholesalers, Retailers, Rentists, Service providers and money lenders all enjoy a special TaxPlanning treatment in decreasing order of merit.

     Sometimes, new Controllers try controlling the Creative element - particularly at election time. But, since the days of the cave dwellers, they usually find out quickly enough, who puts the meat and potatoes in the pot.

    The Philosophy of Tax:

    The Philosophy of Tax, particularly in Australia, is to tax to the hilt those Controllers and Critics who have large incomes but no Patriotic commitment to Creating the Common Wealth of our Nation.

   This has two effects. It ensures that they are limited in the contribution to enlarging our International Trade Deficit.

        They are also forced to share their income with those who are unable to work as their commitment to "the Lucky Country".

        Both are presumed to over indulge in highly taxed social drugs - nicotine, alcohol and petrol - so heavy taxation is a commendable way of reducing the risk of accident, lost quality control and inferior health.

        Only Death and Taxes:                       (but only for the Working Class)

        The Controllers have installed, not only excise, but also levies (as in Medicare) tariffs, charges, tolls, stamp duties, guarantees (as in Training), fines and compulsory Superannuation, Capital Gains Tax and now, a Goods and Services Tax - VAT and in the future KAP and LTD.

        They will continue to do so for these same obvious - and necessary - reasons.

        To take from the rich to give to the poor is another Robin Hood Fairy Story for Kids - and the poor.

        The function of the Rich is to provide Employment, Accommodation, Art and Consumables - the Goods and Services, etc - not to pay Tax as a Servant.

      The function of the poor is to circulate money back to the Government via Excise and GST and to vote for their leaders every 3 years. Also to eat cake and go to the circus.

        Economics:
        Taxation,  in particular for Government and Treasury Economists, is to control the supply of money by taking money out of circulation. Otherwise it would lead to inflation and we would loose total control of our financial wealth as we have done with our asset wealth.
        It reduces the imbalance in International Trade and the subsequent inefficient devaluation of our dollar against others who are more efficient, more technically and socially advanced.

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         It once allowed Sales Tax  exemptions and Fuel Rebates to Primary Producers and Miners. Sales Tax exemptions to  Manufacturers. These together with most businesses - Sales, Service, Rental and Investment- have "necessary" Tax deductions incurred in producing a Taxable Income, well beyond that available to the no risk employee/servant.

        Sponsored Sportspersons:
        Sponsored Sportspersons are considered Service Providers - just like Politicians (see ATO TaxPack: Supplement Tax Return Item 19) if you have a mind to disagree.

        The Working Class:
        Most of these tax advantages are not available for PAYG Income (Working Class) employees - be they Union Officials, Company Directors, Judges, Admirals of the Fleet, Academics, white collar or other working class heroes.

        On the other hand, if or when any one feeling particularly Creative or Patriotic, wishes to moonlight and contribute to the Common Wealth then he is able to TaxPlan - within Part IVA - to his heart's content

     "Who's Afraid of the Big Bad Wolf?"
         TaxPlanning  may be morally offensive to those who are afraid to TaxPlan. But, it is not only within the Law. It is a Patriotic Duty - like Politics.

         Try a quick phone call to the Australian Tax Office with the question 

          "Can I, Patriotically, install a Flag Lieutenant Flagpole with our Australian National Flag, on my front lawn as a Tax Deduction" 

      The answer will soon establish the moot point on who is Patriotic and who is not)

    "Ask not 'What this country can do for me'.

   Rather 'What can I do for my Country?'"
                                                                   John F. Kennedy

       The Cash Economy:
       Not all the people, who earn an income from their own toil and financial investment, are judged by the Australian Tax Office to be "in business" or Business Class. There are limits set that they have to measure up to to be considered "Business Class" rather than pursuing a pastime or "Hobby". 

        The Average Australian Small Family Business:
        A Creative Average Australian Family of five in a Small Family Business has the option of a non-Taxable Income of close to $70,000/annum with an additional $50,000 per annum normal family overhead costs for Deduction and Depreciation  (not normally available to Working or Servant Class)

        (A very close inspection of the ATO Tax Pack Supplement will show this in some detail. If you have a son at Uni doing Tax Law even better (I hope) 

        A glance at the Australian Master Tax Guide would help more. Or a rash of requests for ATO Private Rulings - using "Taxese" as basic language would help most. 

         Call your local bookkeeper - accountant - could give a clue. 

         Best of all - a two weeks' Tax Planning Seminar on the Gold Coast for the whole family might be the best) 

        The Classless Society:
        In our classless society, it is only on the 1st July each year when the Individual Tax Return is to be completed is there any compulsion to differentiate between "Working Class" and "Business Class".

        And the need for a Tax Philosophy.
         And a Tax Philosiphy, to remind the Controllers and the Critics of their special obligation to those who would risk their own money and credibility to Create the Common Wealth, including the Goods and Services (Accommodation and Employment etc.) for all.

         ATO Income Tax Returns:              (includes the Level Playing Field)
         Working Class file Items 1 to 10 on the ATO Individual Tax Return. Business Class Items 11 to 19 on the Supplement Return known as the Level Playing Field. It is called the Level Playing Field for the Small Family Business owners file the same information as Kerry Packer - only the $ amounts differ.

          Jack is as Good as His Master:
        But can only be a spectator/critic when the Rich Masters play on the "Level Playing Field" (ATO TaxPack Supplement)

       The Voters: The Rich - the Poor - and the Ugly.
        Then again, in an Election year, the poor, the rich and the ugly are bribed and threatened outlandishly. Promises that the creative rich and possibly, wealthy, will again be made to pay more tax.

Promises that never have been, and cannot be kept.

          This seems to appeal to some until the day comes when they realise what happens. More of the rich flee the country for better investment off shore. They leave the poor to fend for themselves.

          This is called unemployment for Australians and investment for patriotic Asian workers. 

          "The Choice Principle"  (within ATO Part IVA anti-Avoidance Legislation?)
           It seems a shame that the Freedom of Choice is shared only by the few when it comes to the "Choice Principle" - the underlying basis of the Australian Taxation Philosophy.

          Currently, Kerry Packer is in the High Court of Australia pursuing his "Choice Principle" against the possible assumption that the Political Part IVA anti-Avoidance Legislation, pursued by the Tax Commissioner in this case, is legally unconstitutional.

          Fortunately, Kerry Packer, will always be "in the High Court" defending our Tax "Choice Principle" while Union Officials and other critics will continue to try to deny, steal or sell it - or take it to the "bottom of the harbour"

          When there is no Philosophical Choice:

       (1) Nobody gets paid until something is sold.

       (2) There never was, never is, never will be, a "free lunch" ---- but it can be Tax Deductible.

        (3) "Nothing is good - nothing is bad - but thinking makes it so"             Shakespeare.

        (4) No one has the Choice to take away from another, the Freedom of Choice.     

        No one!

    NB.

  For Information on Taxation don't hesitate to check with the Australian Taxation Office Web Site:

       www.taxreform.ato.gov.au

       infoline Ph 13 61 40