Australian Economists Argue Against Corporate Tax Cuts
A group of 50 economists recently signed a letter imploring the Australian Government not to cut corporate tax, a move which is being viewed as perplexing by some observers in a country which now has an unfashionably high rate of corporate tax, at 30 percent, and is beginning to trail the pack of leading industrial and developing economies by some margin, the OECD average now being about 24 percent.
Of course it’s also easy to make the case, as the aforementioned economists have, that this is a matter of fairness, and that the Government should put the vulnerable in society first, and not, as the letter argues, give tax cuts to big business. All of which sounds wholesome and worthy, but Australia is in a bit of an economic and fiscal hole at the moment, having suffered particularly badly at the hands of the commodity price collapse. It needs investors – investors who will pay taxes and employ people who will pay taxes – but they are unlikely to come if taxes are too high to begin with, and that is just an unpalatable fact of the modern, globalized world we live in.
For more information on this, and other topical international tax matters, please visit: https://www.cchgroup.com/roles/corporations/international-solutions/research/global-tax-weekly-a-closer-look