Dawn of the McManor House

According to an SBS News report, under the Australian Government's planned tax changes, knocking down a house and putting up a duplex, or a block of flats gets you a 50% capital gains tax (CGT) discount. But will converting a McMansion into a duplex, or manor house, count as a "new build"? This would require an extensive rebuild. to convert one home into two three, or four, so I suggest should be allowed.

This could be a way to rapidly, cheaply & environmentally, increase the housing stock. It could include converting useless space in existing homes (studies, media rooms & garages full of junk), into useful living space. Built in garages could be replaced with carports having a roof made of solar panels, with space for batteries, car chargers & storage hot water systems.

We might see companies specialize in this form of home conversion. Most Australian households are 1 or 2 people. Rebuilding our hosing stock could provide homes better suited to this & eliminate the housing shortage.

A McManor house could be useful for a family as it grows and shrinks. However, this might need further tax reform. For example, reducing the current tax exemption on the family home, to an exemption on the average priced family home. There is no reason why someone with a $10M home should be able to sell it tax free. The median Australian home value is about $1M, with Sydney nearer $2M. So a limit on tax concessions could be set at $2M nation wide, or regionally at $1M to $2M.

Big Data Strategy

An Australian Government Big DataStrategy — Issues Paper has been released for comment. The term "Big data" is used for datasets larger than those usually used in an application and which are difficult to analysis with conventional techniques. The older term used for this is "Data mining". Government can use data analysis for  "evidence-based" policy and services: that is where the policy and service deliver is based on real world information, rather than just theory. The leading agency for data mining is the Australian Taxation Office, using "Rattle" developed by Graham J William at the ATO, as a front end for the R statistical programming language. The Australian National University has an ANU Data Mining Group and courses in:

1. COMP3420 Advanced Databases and Data Mining
2. COMP8400 Algorithms and Techniques for Data Mining
3. COMP7410 Data Mining and Matching
4. MATH3346 Data Mining Honours

E-invoices Online in Taiwan

The Australian Taxation Office allows electronic tax invoices , provided both parties to the transaction to keep a copy (I assume the ATO can then check the two copies match).

The Taiwanese regulations seem to require the seller to make their copy available to the buyer online, at least for transactions with consumers. That might require companies to keep these records available for many years, as the tax office reserves the right to audit for years later.

Harvey Norman Offshore

Gerry Harvey of retailer Harvey Norman, is reported to be part of a campaign against overseas online retailers being GST exempt. However, Harvey Norman also claims to be Ireland’s largest retailer of furniture, bedding, electrical and computers. Harvey Norman New Zealand sells goods online. Goods ordered from Ireland and New Zealand would be exempt from Australia GST. So Harvey Norman is one of the stores which Mr. Gerry Harvey is criticising.

New Taxation Office Computer System Problems

Some months ago I received a letter from the Australian Taxation Office t(ATO) elling me I had to make quarterly "Pay as you go" payments. That did not come as a surprise, but what was curious was that the ATO said they had been unable to contact me, as they did not have my current address. I have been at the same address, submitting tax returns and getting replies from the ATO for years. Clearly they had my address previously and I have not , so they must have lost the address. I telephone the tax office to ask why they had lost my address, but did not get an explanation. I paid the full amount requested for the year and did not expect to hear any more about it.

However, this week I received a request for another payment of PAYG for the next quarter. Given I had already paid the full amount for the year, I can't see why I have been sent another quarterly request for payment.

Recently the ATO installed a new computer system and there were some reports of problems. It may be that the new system lost my address and can't keep track of what I have paid. If this is happening to other taxpayers it has the potential to seriously undermine confidence in the taxation system.

Tax office computer system problem

Last week I received a letter to my home address saying the ATO couldn't contact me earlier because they did not have my current postal address and asking for money. At first I assumed this was a scam, as the ATO has had the same address on file for me for decades. But I called the Tax Office to check. There was a26 minute phone queue and then further confusion as the reference number on the letter I got was not recognised by the ATO system. However, after that the ATO confirmed they sent the letter, but could not provide a reason why the address had disappeared from their system. I can only assume that this is because the ATO recently changed their computer software and they have not yet got all the glitches out of the system.