Personal Finance

Defining Middle Class

Many people are born into the middle class, but for those born in poverty the lifetime challenge is reaching middle class status.  The definition of middle class status is a challenge in itself. People in poverty are often described as those surviving on less than US$1.25 (some R17.50) per day. However, that does not imply that middle class simply starts just above this threshold.

Featured Articles

All For One, and Savings For All

As predicted, the US Federal Reserve has raised interest rates after nearly a decade, which means a slightly better rate of return for savers. Meanwhile in the UK, the Bank of England has kept the benchmark rate at a rock bottom 0.5% for the 81st month in a row. All the while, there are calls from policymakers and politicians for a grand vision for saving. People should take responsibility, the argument goes, for their own welfare.

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The Benefits of a Banking GST for Australia

South Australian Premier Jay Weatherill has argued for broadening the GST base to include all financial services, something also floated by the Financial System Inquiry. The idea has merit, although the complexity of the issue makes assessing the consequences and merits difficult.

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A Subprime Mortgage By Any Other Name

The subprime mortgage market brought the world to its knees, so what, on earth are we doing inviting it back to the party?  It was the packaging and reselling of this low-rated debt from US homeowners that sparked the global financial crisis. Now there is increasing evidence that such products are becoming popular again both, in the UK and the US. How scared we should be?

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Not too Big to Fail, but Nothing Learned

Do you remember the 2007-08 banking crash? In the build up to it, UK bankers made vast profits and their executives collected big bonuses. After the crash, taxpayers bailed them out, which led to increased government borrowing. We have all been suffering a never-ending programme of austerity ever since.

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Tax Code Simplification Presidential Candidate-Style

One of the 17 presidential candidates recently said, “I can write a tax code in three pages.” Carly Fiorina is not alone among her fellow 2016 presidential contenders in advocating tax reform and simplification of the tax code. However, none is quite so ambitious.

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Shadow Banking's Global Reach

In August, the Financial Times reported that 11 Chinese shadow banks had written an open letter to the top party official in Hebei (河北) province asking for a bailout. Soon afterwards, Foreign Policy magazine ran a story headlined, “Shadow banking is killing China’s stock markets.”

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Implementing the 'Plastax' in the UK

Last month, England became the latest government – and last among members of the UK – to pass a policy to combat the recent rise in the use of disposable plastic shopping bags, in its case a five-pence charge for each one.

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A Wale(s) of a Tax Strategy

Companies such as Apple, Starbucks, and Amazon are well known for legally using international law to their advantage when it comes to tax. Now a small Welsh town is mimicking their tactics. Independent traders in Crickhowell are moving their businesses “offshore” to avoid paying tax.

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Loaning with a Sense of Purpose

Over the past half century, lending to the poor has taken on many different forms. The microfinance movement began in earnest when Muhammad Yunus, the then-economics professor at Bangladesh University, came up with the idea of providing small loans using his personal funds to local villages in the 1970s.

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The Potential in Splitting Australia's GST into Two

The overflowing rubbish tips of Lagos, the Pacific Ocean garbage patch, and the huge electronic graveyard of Guiyu, China might seem irrelevant to Australia’s current debate over reforming the Goods and Services Tax. Yet all three of these far-flung places are testament to the world’s incessant habit of buying stuff and then later throwing it away – and Australian consumers are just as culpable as any.

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A Lesson in Fairness for a Retirement Savings System

Australia is engaged in an ongoing debate about the fairness of the superannuation system. Those on the highest incomes are extracting the greatest and an unfair advantage from tax benefits currently available. This problem of perception is inevitable in a system where contributions come out of our pre-tax income.

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It Appears that India Will Give a Goods and Services Tax a Try

India is moving towards introducing a Goods and Services Tax (GST). The GST would be a multistage comprehensive value added tax (VAT) encompassing both goods and services. Given the federal structure of India and the fact that taxation powers have been constitutionally assigned to different governments, the introduction of a GST would be a major indirect tax reform since independence. Both the federal and state governments will have concurrent taxation rights at every stage of production and distribution.

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