Your bouncing baby...tax deduction?
Australia currently has a "baby bonus," under which a family may receive up to A$4,000 per year for dependent children under the age of 5. This is similar to the "earned income credit" in the U.S., under which lower income families may be entitled to receive a refundable income tax credit for each dependent child.
A medical expert in Australia is proposing that the government do the exact opposite. Professor Barry Walters thinks that the government should charge a family A$5,000 (US$ 5,700) for each child they have after a proposed limit of two. And for child numbers three and above, Walters says the parents should have to pay an annual tax of A$800 for life.
Walters says a move like this would help save the planet. The tax could be used to offset the child's lifetime carbon-dioxide emissions. Instead of encouraging families to have children with the baby bonus, Walters thinks the government should give incentives to reduce offspring and related carbon footprints.
It's an interesting concept. How about this one: Let's not give extra tax benefits to those who have children, nor penalize families who have children. Let's just let them foot the bill for the children they choose to have without raising or lowering taxes in any way.
Forensic accountant Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations through her company, Sequence Inc. Forensic Accounting. The Association of Certified Fraud Examiners honored Tracy as the 2007 winner of the prestigious Hubbard Award and her first book, Essentials of Corporate Fraud, will be on bookshelves in March 2008.