Big ideas from Tasmania, a stunning island on the edge of the world.
Bill Browne's blog
1/ Giving business a $65 billion dollar tax cut means billions of dollars less for schools, hospitals and other services.
Giving business a $65 billion dollar tax cut means billions of dollars less for services like schools and hospitals. Treasury modelling even assumes these company tax cuts will be matched by cuts to services and higher taxes on people instead.
2/ The big four banks get an extra $9.5 billion dollars. Really.
The Coalition’s company tax cuts represent one of the largest hits to our revenue in recent times, so it comes as a surprise that the legislation has not even been subject to an inquiry.
For those keen to point out that this legislation represents ‘just’ the company tax cuts for big business, and that the legislation was subject to inquiry in its original form, you would be only half right.
The Australia Institute and others have made the point that company tax cuts can only benefit foreign shareholders.
Australia’s system of dividend imputation means that Australian shareholders will not benefit from reductions in the company tax rate.
Australian shareholders would notice any increase in company after-tax profit being matched by a loss in franking credits attached to their dividends. However, foreign owners cannot utilise franking credits so for them there is an unambiguous benefit from an Australian company tax cut.