In the 1950s, some ATO personnel informally referred to the tax laws as Pig's Stew because they collected Payroll tax, Income tax, Gift duty, Sales tax, Stevedoring industry charge, Tobacco charge, Estate duty and Wool tax.
Other personal taxes
In addition to income tax, you may have to pay other personal taxes such as capital gains tax (CGT) and goods and services tax (GST).
Capital gains tax (CGT)
This tax was introduced in 1985. It was introduced because some taxpayers received amounts known as capital gains that were not regarded as income under the income tax laws and so were not taxed. This was identified as unfair, so laws were introduced to include capital gains as assessable income and liable for income tax.
Generally, you make a capital gain when you sell or dispose of a CGT asset for more than it cost. 'Cost' includes purchase costs, maintenance and loan interest. CGT is a tax on the gain or profit from selling certain assets such as shares, rental properties, collectables (art and antiques) and the sale of businesses. Cars are not subject to CGT and the family home is generally exempt from CGT unless it has been used as a place of business or for income producing purposes.
There is no set tax rate for CGT. The net capital gain is added to your other assessable income and taxed at your applicable income tax rate. The capital gain amount may be reduced by a discount provided you have owned the asset for at least 12 months. A discount of 50% applies only to individuals and trusts, while a 33 1/3% discount applies to super funds.
You may make a capital loss if an asset is sold for less than it cost. No tax is payable on a capital loss. A capital loss can only be offset against a capital gain. If you don't have a capital gain, your capital loss is carried forward to future years to be offset against future capital gains.