Australia: Boycott stamp duty!

If you're a home owner, you don't have to pay stamp duty just because you change your address. If you put tenants in your former home and rent your new address, there's no change of ownership, so you pay no stamp duty, no conveyancing fees, and no commission on any sale. And you become eligible for the “negative gearing” deduction on your old address.

Replacing property taxes and payroll tax

The revenue from payroll tax, property transfer duty, insurance duty... and the existing land tax could be replaced by a broad-based “land tax”, with no exemptions or thresholds, at a flat rate of about 1.5% per annum...

Alternatively, the same revenue could be replaced by a property-vendor duty levied on the real increase in the land value since the last sale, at a rate of about 45%...

Either option would (i) create jobs by reducing taxation of labour and its products, (ii) encourage construction by reducing taxation of buildings, and (iii) make new infrastructure pay for itself through the ensuing uplifts in land values.

Read the full submission (State Tax Review, Tasmania).

Plea bargaining with a vengeance

In Australia, if you need to sue your State or Territory government over any matter, you should always make one further claim, namely that payroll tax is an unconstitutional duty of excise because it applies to labour embodied in goods. You have standing to make that claim because payroll tax damages your job security and/or reduces your earnings and/or raises prices that you pay for goods and services. You should hold out for vindication on that claim by refusing to accept any out-of-court settlement that does not include either abolition of payroll tax or a public admission that the tax is unconstitutional. But you can also indicate that if you receive a satisfactory settlement of your other claim(s), the payroll tax claim will not be worth pursuing by itself. After all, you hadn't pursued it before.

Keating's Great Big Tax on Everything

A 9% federal payroll tax for general revenue would not pass the laugh test, let alone the electoral test. Neither would a federally funded superannuation contribution set at 9% of the individual wage or salary, with the result that the workers with the highest incomes get the biggest handouts. But put the two together and take most of the combination off-budget, and you get Australia's newest sacred cow: the Superannuation Guarantee (SG)...

Read the full submission (Senate Standing Committee on Economics).

If Anna Bligh ran a body corporate (U.S. ed.)

Once upon a time, there was a huge condo building called Brisbane. It had been built in stages. The ground floor, commonly called the “central business floor”, was the oldest (but was always being renovated). The higher floors had been added more or less haphazardly over the last century and a half.

How tax causes financial crises and unaffordable housing

If you want to model the economy through the bubble-burst-recession cycle, as Steve Keen is trying to do, the math gets complicated. But if you only want to find some sufficient conditions for financial instability (or, on the contrary, necessary conditions for financial stability), the math is dead easy: you assume financial stability and look for conditions under which that assumption leads to an absurdity or a contradiction. The conditions relate to taxation of property, and can be represented by means of a “contour map” on which you can locate our tax system to see whether it is compatible with financial stability. And it isn't.

Five secrets for a successful economy

You cannot legislate the poor into industry by legislating the rich out of it. You don't add wealth by subtracting it. Government cannot take any land-rent that a landowner doesn't first take from somebody else. Whenever somebody receives something without working for it, somebody else has to work for it without receiving. The worst thing that can happen to a nation is for landowners to get the idea they don't have to work because somebody else will pay them for access to land, and other people to get the idea that it does no good to work because the government takes the fruits of their labor to make up for its failure to collect the rent of land.

[With respect, but without apology, to Adrian Rogers.]

Pyrrhic victories violate rule of law

People who successfully challenge fines in court often complain that it would have been easier to pay up in spite of their innocence. But the rule of law does not allow any government to force you into a situation where it is easier to accept a legally perverse outcome than to correct it.

Ubuntu 12.04 Alpha 1: Still no full HD on Dell Vostro 360

I'm typing this review in a Firefox window under the first alpha release of Ubuntu 12.04 "Precise Pangolin", running from a live USB stick on a Dell Vostro 360 "all-in-one" PC. The CPU is an Intel "Sandy Bridge" Core i3-2100 with integrated HD 2000 graphics. Although the native resolution is 1920x1080 (FHD / "full HD"), I'm getting only 1280x1024. To get that, I need to boot with either the "nomodeset" or the "i915.modeset=0" parameter.

Why renters are vermin

My wife and I live near the top of a tall residential building on the edge of downtown Melbourne. The view from our balcony is slowly being ruined. To the right, a newer, taller residential building dominates the skyline. Straight ahead, not quite breaking the horizon, is another residential building, adorned with signs advertising apartments competing with ours. Behind that, and towering above it, is a crane drawing attention to yet more competing apartments under construction. Behind and below that crane is another. Thirty degrees to the left is yet another. Rumour has it that several more sites in the foreground are earmarked for high-rise residential developments that would compete with our apartment and further encroach on our view.

Prosper Australia's film: Real Estate 4 Ransom

If you had all the money in the world, and I owned all the land, how much do you think I'd charge you for the first night's rent?

Watch the trailer:

Slump in property sales points to recession

... In 2010-11, the index fell by the 3rd-biggest percentage on record. The biggest fall was in 1974, and was followed by recession in 1975. The 2nd-biggest was in 1989-90, and was followed by recession in 1990-91. The 4th-biggest was in 1981-2, which was a recession year, and was followed by a worse recession in 1982-3. If the fall of 2010-11 fits the pattern, there will be recession in 2011-12.

Read the full article (LVRG Blog).

How to beat fines due to bad signage

If you are fined for being led astray by inadequate or confusing signage, the mere fact that the government led you astray does not usually give you a valid defence. But it does give you a line of counterattack, because aiding or abetting someone to commit an offence is itself an offence.

How to avoid stamp duty on conveyances

Even if you are an owner-occupant and are forced to relocate, you can install tenants at your old address and rent the new one, thus avoiding a dutiable change of title.

— “Unreliability of stamp duty & income tax”, LVRG Blog, Sep.17, 2011.

By buying the home you want to invest in and renting the one you want to live in, you can optimise both decisions independently, avoid stamp duty on future changes of address, and claim the negative gearing deduction. These advantages are likely to prevail over the capital gains tax liability and, where applicable, the loss of the FHOG.

— “Blueprint for a stamp duty revolt”, On Line Opinion (Australia), May 1, 2008.

Drug "laws" not laws at all

In Momcilovic, the High Court found that under Victoria's drug legislation, the “reverse onus” of proof, whereby the defendant had to prove that she knew nothing about the drugs, applied to the offence of possession, but not to the offence of trafficking with which she was charged. The court was not asked to rule on a more fundamental question: whether the reverse onus, even for possession, is compatible with the rule of law.

Can banks really evict tenants?

... Even more iniquitous than full-recourse mortgages is the practice of evicting tenants when their landlords default... If you are a lender repossessing a rental property, you should have to honour the rental contract. If you sell the property, you should have to sell it subject to the rental contract...

In the mean time, if you are a tenant being evicted because your landlord has defaulted on the mortgage, you might try telling the lender that you are considering a lawsuit and/or private criminal prosecution against the lender for being an accessory to the landlord's insolvent trading. You might be able to extract a very favourable rental deal in return for dropping that threat.

Read the full article (On Line Opinion, March 9, 2011). P.S.: See also this comment.

War on drugs "universally unconstitutional"

...Therefore, if you are on the jury in the trial of a person charged with possession of a prohibited drug... and if you are told that the “law” requires the defendant to prove that the possession was unwitting, it is your civic duty to uphold the real law: put the onus of proof back where it belongs (on the prosecution), raise it to the proper standard (beyond reasonable doubt), and hand down a verdict on that basis.

Read the full article (Atlanta IMC, July 30, 2011).

Juries can already protect whistleblowers

Your report on the Allan Kessing case (The Australian, 19/3, p.29) fails to mention the whistleblower-protection law that we already have, namely the power of the jury to acquit in the teeth of the law and the facts.

Australian payroll taxes unconstitutional?

One reason for Australia's chronic current account deficit is payroll tax, which inflates prices of Australian products, including exports and import replacements. This suggests that payroll tax is an excise, in which case it violates s.90 of the Constitution.

How the Left could learn to love a retail tax

Conventional wisdom holds that replacing income tax with a consumption tax would be regressive, and that it would devalue past savings by raising prices. Both objections assume that gross wages and salaries would stay the same. If, instead, net wages and salaries stay the same, both objections disappear.*

When $4 million for nothing isn't enough

Now let me get this straight. The Property Council of Australia is complaining that if the value of your land has risen from $6 million to $10 million since 2005, your land tax bill has not fallen in spite of cuts in the top marginal rate ("Land tax cuts won't bring savings", The Age, April 15).

100 words for the Australia 2020 Summit

Benefits of economic growth mostly disappear into land values. Benefits of infrastructure, including that which contributes to ecological sustainability or the viability of rural communities, are manifested as uplifts in land values in the serviced locations, as are some benefits of family support services, health services, cultural facilities, and even national security (largely the security of the nation's land). The basic grievance of indigenous Australians is about land. Corruption of government is usually driven by pursuit of unearned uplifts in land values. As all ten topics involve the economic significance of land, the Summit must include participants who understand it.

Can you stop paying the mortgage and keep the house?

As falling U.S. home prices leave mortgage borrowers owing more than their homes are worth, borrowers are encouraged to stop paying the mortgage, move out of the house, and send the keys to the bank ("jingle mail"). That much is well known. But, as this Bloomberg story explains, the practice of selling and reselling mortgage loans, packaging them into securities and selling them again, and so forth, is enabling some borrowers to stop paying their mortgages and keep their homes, because nobody can prove to whom the money is owed. (Jingle Bells?) Presumably, if the borrowers can stay in the homes long enough, they eventually acquire ownership through squatting laws. (Jingle all the way?)

Sure-fire method of avoiding jury duty?

Dear Sir...^†

If a jury acquits a defendant, the Crown holds the verdict in contempt by failing to reimburse the defendant for legal costs and other losses and expenses, and by failing to compensate the defendant for pre-trial incarceration.* These outcomes are inconsistent with an unrebutted presumption of innocence. They reduce the criminal trial to a charade in which the defendant will be punished regardless of the verdict, and in which, in many cases, one could seriously argue that an innocent defendant would minimize his losses by not contesting the charge.

Ball in Property Council's court

The imminent arrival of the four millionth Queenslander was the cue for the Property Council of Australia to make yet another complaint about lack of infrastructure.