Robertson fails simple maths

Photoshopped image credit: Pixy

It is extremely worrying when the Minister of Finance, responsible for the budgets for an entire country, cannot understand simple basic maths. When asked if one third was equal to 33% his response was, “No, I wouldn’t accept that. I’d want to go and test that more thoroughly.

When challenged about that answer Robertson said, “I said that I wanted to go back and check the member’s characterisation of the report.”

Good grief man! It is extremely simple maths, what is there to go back and check?

Amy Adams probed these very complex mathematical concepts behind the Capital Gains Tax in question time on Wednesday. Quote.

[…] Hon Amy Adams: Well, has he read appendix A of the Tax Working Group report, which says that for the purposes of its recommendations, assets are assumed to grow at a 3 percent nominal annual rate which is made up of 2 percent inflation and just 1 percent real growth?

Hon GRANT ROBERTSON: I have indeed read that.

TWG report Vol 1, p 107

Hon Amy Adams: Well then, can he confirm that those recommendations mean taking one third of the capital gain in tax when the other two thirds is just made up of inflation and mean that the Government would be taking every single dollar of real gain made in tax?

Hon GRANT ROBERTSON: No, I wouldn’t accept that. I’d want to go and test that more thoroughly. […]

End quote.

I realise it is a tough question to answer on the hoof under the pressure of the TV cameras in the House, but really, Grant, if one third of the capital gain is the growth over time and the rest is simply keeping up with inflation and the government taxes us on 100% of the capital gain at a tax rate of 33%, that means the government takes 100% of the real growth in tax. As there is no discount for inflation. Quote.

TWG report Vol 2, p 23

Hon Amy Adams: How can the Minister, who has acknowledged that the Tax Working Group recommended 100 percent of the gain at full marginal rates be taxed and said that the capital gain is made up of two-thirds inflation one-third gain, dispute that that means therefore that the 33 percent of the tax on 100 percent of the gain is the equivalent of every single dollar of real gain made?

Hon GRANT ROBERTSON: I said that I wanted to go back and check the member’s characterisation of the report. That’s what I will do. But, again, I say to the member, looking at that in isolation from the rest of the company tax regime that the owners of those companies will pay does not give a fair reflection of what the tax impact would be on any company or on any individual person who owns a company.

Hon Amy Adams: How can he claim that he does concern himself with international competitiveness when considering tax, when he is now actively considering a capital gains tax with the third-highest marginal rate in the OECD?twice the scope of Australia’s?and one that the Tax Working Group’s own modelling shows would take every single dollar of real gain made? […] End quote.

Hansard


Not only would I give Robertson an F for fail, I would suggest a DCM award as well.

53%
×