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Showing posts with label taxation. Show all posts
Showing posts with label taxation. Show all posts
Saturday 4 August 2018
Friday 13 July 2018
How Trump's corporate tax cuts played out in the US economy
Crikey.com.au, 10 July 2018:
Evidence is now emerging
of just how extraordinarily wasteful Donald Trump's trillion-dollar corporate
tax cut has been as the results -- or lack thereof -- filter into the real US
economy.
It's now
well-established that the bulk of the tax cuts have gone into record-breaking
share buybacks and increased dividends by US companies, with hundreds of
billions of dollars flowing or set to flow back to investors. But not a lot of
the rest is flowing into extra investment -- the raison d'etre of
company tax cuts. New
investment data shows US equipment investment fell in the first
quarter of the year compared to the final quarter of 2017. How about wages,
which are supposed to increase due to company tax cuts (at least according
to Mathias
Cormann)? In June, monthly wage growth in the US fell to
0.2% from 0.3% in March, lower than expected and leaving wage growth
at 2.7% for the 2017-18 year. Inflation in the US was 2.8%
for the year to May, suggesting US workers are actually going backwards
after inflation.
US unemployment is at 4%
(up a tad) — far below our own level of 5.5%. Like the Kiwis, the Americans
can’t get wages to grow even with full employment — or even with tax cuts that
have massively inflated the US deficit at a time of peak employment.
The fact that Trump and
his GOP cronies have pushed the US budget deficit toward $1 trillion a year
(remember when the Republicans were the party of fiscal restraint?) at a time
of such strong employment also has implications for the stimulatory effect of
such largesse. New research from the San
Francisco Federal Reserve shows that fiscal stimulus is significantly
weaker at times of expansion than during recessions, and that the Republican
tax cuts will not meet what the paper terms the “overly optimistic”
expectations of boosters. Instead of the boost to US GDP growth this year of
about 1.3 percentage points estimated by the Congressional Budget Office and
other forecasters, they write, “the true boost is more likely to be less than 1
percentage point,” with some studies pointing to as little as zero.....
Read the full article here.
Saturday 30 June 2018
Tuesday 26 June 2018
All income groups strongly favour the Labor tax plan, according to Essential Research survey
In this Essential Research survey half the people polled preferred the Shorten Tax Plan over the Turnbull Tax Plan - including 30 per cent of Coalition voters.
That is a 5 per cent increase in support for the Shorten plan and a 4 per cent loss of support for the Turnbull plan since last month.
Essential Report, 19 June 2018:
Friday 11 May 2018
Entrenching inequality in the Australian way of life
There are no
real winners in this 2018-19 federal budget – everyone loses something because funding/staffing cuts include services which affect the smooth running of the country, such as regulatory
oversight, law, policing and communication.
Partial winners in the longterm are those in the two highest income/asset deciles. The Anthony Pratts, Gina Rineharts, 'Twiggy' Forrests, Bruce Mathiesons, Malcolm Turnbulls and Peter Duttons of this world.
Those losing the most are low income households, especially those dependent on welfare payments and those with an annual salary/wage between $41,000 to $87,000 because they will be assessed under the same tax rate as now but with less of the tax benefit pie on their plates in the future.
Federal Budget 2018 Facts of Life - a non-exhaustive list
* Funding in
this budget does not fully compensate for funding cuts and tax increases in the
last three federal budgets.
* Cuts from
previous budgets are still impacting on health services; education funding for schools and vocational studies have been reduced by a combined total of $17.27 billion, funds for the public broadcaster are
frozen representing a loss of $84 million on top of $254 million in budget cuts since 2014.1
* Cuts are
also occurring in:
Australian
Securities and Investments Commission (ASIC) with permanent
funding cut from $346 million to $320
million over two years and staff numbers reduced by 30 investigators in the next
year.
Office
of the Director of Public Prosecutions with funding cut from $77.4
million to $73.75 million in two years.
The
Australian Federal Police funding cut from $1.03 billion to $926
million within four years.2
* Although the
federal government is contributing $43 billion, to fund what it calls its “share”
of the National Disability Insurance Scheme (NDIS) from 2018–19 to 2021–22, there is
still no dedicated funding stream for NDIS.
* Rural, regional
and remote area health is only receiving 16.66 million a year for five years to
improve health outcomes in those areas across Australia – none of which appears to go directly to treatment of patients or additional services.
* Personal
income tax cuts aren’t being offered to those on taxable incomes below $20,548
per annum. Those workers
with a taxable income of $20,548 will receive $1 a year in income tax relief. It is reported that the full range of personal income tax relief (which provides the most benefit to the highest earners) will eventually cost est. $17.8 billion annually in lost government revenue if scheme continues until 2027.
* Individuals earning $100,000 to $125,330 per annum now receive a low and middle income income tax offset despite being in high wage/salary deciles.
* There are estimated 101,508 older Australians on the waiting list for appropriate home care packages.4 At least 60,000 of these do not have even the initial lowest level of home care package and, all the federal government is offering is funding for an extra 14,000 high level packages still leaving 46,000 elder people with no hope of receiving assistance in the foreseeable future to keep living at home.
* Individuals earning $100,000 to $125,330 per annum now receive a low and middle income income tax offset despite being in high wage/salary deciles.
* There are estimated 101,508 older Australians on the waiting list for appropriate home care packages.4 At least 60,000 of these do not have even the initial lowest level of home care package and, all the federal government is offering is funding for an extra 14,000 high level packages still leaving 46,000 elder people with no hope of receiving assistance in the foreseeable future to keep living at home.
* There is a
proposal to change the progressive tax system from 2018-19 so there are only
four income tax brackets and people with incomes from $41,000 to $200,000 per
annum will pay the same tax rate. This means that est. 62 per cent of future
benefits would go to the highest salary/wage earners with only 7 per cent going
to those on the lowest wage.5
According
to Budget Strategy and Outlook Budget
Paper No. 1 2018-19; When completed,
the plan ensures that about 94 per cent of taxpayers are projected to face a
marginal tax rate of 32.5 per cent or less in 2024–25.
* People over retirement age receiving the Age Pension are being
urged to consider funding part of their retirement through the Pension Loans Scheme which will be expanded on
1 July 2019, with the available fortnightly loan plus pension amount increasing
to 150 per cent of the maximum rate of fortnightly Age Pension. The current
maximum fortnightly pension amount is $907.60. This loan will normally be repaid
when the secured real estate asset (usually the principal home) is sold or from
the pensioner’s deceased estate.6
* This budget continues the funding model which skews federal primary and highschool funding towards private schools via the Quality Schools scheme with funding for government schools set at $7.6 billion and non-government schools at $11.8 billion in 2018-19 increasing to $9.6 billion and 13.8 billion in 2021-22 .7
* The Northern Territory remote area Aboriginal children and schooling component has been cut by over $47 million across the next four financial years.
*TAFE further technical education funding has been cut by $270 million on top of previous budget cuts.
* This budget continues the funding model which skews federal primary and highschool funding towards private schools via the Quality Schools scheme with funding for government schools set at $7.6 billion and non-government schools at $11.8 billion in 2018-19 increasing to $9.6 billion and 13.8 billion in 2021-22 .7
* The Northern Territory remote area Aboriginal children and schooling component has been cut by over $47 million across the next four financial years.
*TAFE further technical education funding has been cut by $270 million on top of previous budget cuts.
* The Goods
and Services Tax has been extended to cover online hotel bookings made via
offshore websites. This is expected to raise $5 million in the 2019-20
financial year.
* Mobile blackspot
program funding ceases in 2019.8
* The cashless
debit card trial in Ceduna (South Australia) and East Kimberley (Western
Australia) will be extended for another year to 30 June 2019. The federal government
refuses to make the costs of this measure public.
* Part or all
of a welfare payment will be withheld to clear a welfare recipients court fines or address arrest
warrants.
* There has
been no increase in unemployment benefits.
* Women &
girls necessary sanitary products are still subject to a consumption tax
payable at the supermarket/chemist checkout.
* Finally,
the Turnbull Government cracked a joke in the budget papers – a new National
Energy Guarantee is expected to reduce annual residential power bills by $400
at some unspecified date in the future.
Footnotes:
2. http://www.afr.com/news/policy/budget/federal-budget-2018-asics-shock-26m-budget-cut-20180509-h0zud4
Thursday 10 May 2018
Before everyone gets too excited about those personal tax cuts in Budget 2018-19
According to
the Turnbull Government Budget 2018-19 papers,
eligibility for the Low and Middle
Income Tax Offset (aka
personal income tax cut) will
assist over 10 million Australians, with about 4.4 million taxpayers with
incomes between $48,000 and $90,000 receiving the full $530 benefit for 2018–19.
The non-refundable offset is
calculated on “taxable
income” which is “equal to an
individual’s assessable income (such as salary and wages and interest from bank
accounts) minus their allowable deductions”.
The announced ‘tax cut’ has a life of four financial years and technically ceases after 2021-22.
It will not see actual tax rates change and will not see the dollar amount in wages paid on a weekly, fortnightly or monthly basis alter.
It will not see actual tax rates change and will not see the dollar amount in wages paid on a weekly, fortnightly or monthly basis alter.
The 'tax cut' will be applied by the Australian Taxation Office and form part of any tax refund due after tax returns are lodged in 2019.
The bottom line is that any person with a taxable income of less than $20,548 will not receive the announced personal tax cut according to the Budget 2018-19 website income tax calculator.
The bottom line is that any person with a taxable income of less than $20,548 will not receive the announced personal tax cut according to the Budget 2018-19 website income tax calculator.
Those with a taxable income of est. $20,548 on 30 June 2019 will receive exactly one dollar a year as a ‘tax cut’ for the next four years.
One would have a taxable income of est. $21,600 to get a ‘tax cut’ of $200 a year for the next four years.
However the first $18,200 of any individual’s personal income is currently exempt from taxation.
Hopefully for the purposes of calculating any tax refund the budget measure includes in "taxable income" the first $18,200 on which no tax is payable.
Otherwise this
budget measure means that anyone with an annual wage of $38,747 ($18,200 tax
exempt + $20,547 taxable income) will not receive the announced ‘tax cut’ for
low and middle income earners.
There is
nothing found in Budget
Measures Budget Paper No. 2 2018-19 or on the Budget 2018-19 website which clarifies the situation.
Monday 7 May 2018
Elder abuse and profit shifting go hand-in-hand in the age care sector?
Any
regular reader of online news would have seen mentions of elder abuse, neglect
and sub-standard health care over the years.
hellocaremail.com.au, 2017:
Elder abuse is a
critical issue in aged care homes, with thousands of cases reported to the
Health Department every year…. In 2016-2017, there were 2853 reports of
“reportable assaults’’ and 2463 allegations of “unreasonable use of force”.
Australian
Law Reform Commission, Elder Abuse (DP 83), Abuse
and neglect in aged care, 12 December 2016:
1.34 Stakeholders
reported many instances of abuse of people receiving aged care. These included
reports of abuse by paid care workers[55] and
other residents of care homes[56] as
well as by family members and/or appointed decision makers of care recipients.[57] For
example, Alzheimer’s Australia provided the following examples of physical and
emotional abuse:
When working as a PCA
[personal care assistant] in 2 high care units, I witnessed multiple, daily
examples of residents who were unable to communicate being abused including:
PCA telling resident to ‘die you f---ing old bitch!’ because she resisted being
bed bathed. Hoist lifting was always done by one PCA on their own not 2 as per
guidelines and time pressures meant PCAs often using considerable physical
force to get resistive people into hoists; resident not secured in hoist
dropped through and broke arm—died soon after; residents being slapped,
forcibly restrained and force-fed or not fed at all; resident with no relatives
never moved out of bed, frequently left alone for hours without attention;
residents belongings being stolen and food brought in by relatives eaten by
PCAs.[58]
1.35 The
ALRC also received reports of other forms of abuse, including sexual[59] and
financial abuse.[60] Restrictions
on movement[61] and
visitation[62] were
also reported. Many submissions also identified neglect of care recipients.[63]
The
Sydney Morning Herald,
15 October 2017:
Across NSW, 58 per cent
of aged care workers surveyed said they have not been able to provide the level
of care residents deserved because of budget cuts. Of those, 80 per cent said
staff shortages were the main barrier to providing proper care.
The
Courier-Mail,
19 April 2018:
PROFIT-HUNGRY aged care
companies are charging fat “administration fees” to skim up to 40 per cent of
government payments for in-home nursing care.
More than 100,000
elderly Australians are on a waiting list to receive as much as $50,000 a year
in a “homecare package” to pay for nursing, housekeeping or companionship
at home. But an investigation by The Courier-Mail has revealed
that some home-care companies are pocketing as much as $19,000 of the
taxpayer cash through hefty “administration” or “case management” fees.
The fees are billed on
top of hourly charges for home help – leaving clients with less cash
to spend on in-home care such as nursing. And if clients want to
switch to a cheaper provider, they are being slugged up to $1000 in “exit
fees”.
The Age, 3 May 2018:
Scandals, including a
recent national audit showing 600 aged-care homes failed in the past
five years to provide minimum standards, prompted a government review. The
Coalition, accepting a key recommendation, has ended the ridiculous practice of
alerting operators to spot checks. The review also urged the streamlining and
strengthening of the regulator.
If one does a
simple online search many of the big ‘for profit’ aged care providers are named
in relation to such abuse, neglect and sub-standard health care allegations.
Now in May
2018 the Tax Justice Network[1] is looking at aged care
provision from another angle. One which shows that the budgetary meanness which sees these big companies expect elderly residents to remain in sodden incontinence pads or live-off meagre meal rations occurs in spite of the millions in profit made on the back of billions in taxpayer funding of the age care sector.
It has
released A Tax Justice Network – Australia Report, TAX
AVOIDANCE BY
FOR-PROFIT AGED CARE COMPANIES: PROFIT SHIFTING ON PUBLIC FUNDS.
Sadly, this
report only confirms the fact that corporate greed runs rampant through all major
aspects of Australian life, including aged care.
Executive Summary, Background, p.5:
Older
people are a growing proportion of Australia’s population; in 2016, 15% (one in
seven) Australians were aged 65 years or older. By 2056 this percentage is
expected to grow to 22% (8.7 million).1 The need for aged care services is
increasing. Between 2015– 2016 almost 214,000 people entered aged care in Australia.
On average, older people in Australia spend three years in permanent
residential care, just over two years in home care, and one and a half months
in respite care.2 The Australian tax payer, via the Commonwealth Government
contributes around 75% of the expenditure in aged care in Australia, which is
around 96% of the total funding on aged care from Commonwealth and State
Governments. Government recurrent spending on aged care services in Australia
was $17.4 billion Australian dollars (AUD) in 2016- 2017, with residential aged
care services accounting for 69.3% ($12.1 billion AUD).3 Some of this funding
is provided as subsidies to aged care provider companies including those that
operate for profit. In 2018 the Australian Nursing and Midwifery Federation
(ANMF), Australia’s largest national professional and industrial nursing and
midwifery organisation with over 268,500 members, commissioned the Tax Justice
Network - Australia to analyse possible tax avoidance by for-profit aged care
companies and to provide recommendations for improving transparency on
Government spending on for-profit aged care.
Key points from the
report
*
By number of beds, not-for-profit providers are the largest aged care provider
group in Australia (52% in 2013-2014), however there has been a rapid growth in
the size and spread of for-profit companies; Bupa, Opal, Regis and Estia are
the largest aged care providers nationally. If Japara and Allity are included,
these 6 for-profit companies operate over 20% of residential aged care beds in
Australia.
*
In the most recent year (mostly the 2017 financial year) the six largest
for-profit companies were given over $2.17 billion AUD via government
subsidies. This was 72% of their total revenue of over $3 billion. These
companies also reported profits of $210 million AUD (2016-2018).
*
Companies can use various accounting methods to avoid paying tax. One method is
when a company links (staples) two or more businesses (securities) they own
together, each security is treated separately for tax purposes to reduce the
amount of tax the company has to pay. Aged care companies are known to use this
method as well as other tax avoiding practices. Another practice is by
“renting” their aged care homes from themselves (one security rents to another)
or by providing loans between securities and shareholders.
*
The six largest for-profit aged care providers have enormous incomes and
profits:
* The largest company, BUPA, had
almost $7.5 billion in total income in Australia (2015-16) but paid only $105
million in tax on a taxable income of only $352 million.
* BUPA’s Australian aged care business
made over $663 million in 2017 and over 70% ($468 million) of this was from
government funding.
* Funding from government and resident
fees increased in 2017, but BUPA paid almost $3 million less to their employees
and suppliers.
* The second largest, Opal, had total
income of $527.2 million in 2015-16 but paid only $2.4 million in tax on a
taxable income of only $7.9 million.
* 76% ($441 million) was from government
funding in 2016.
*
Allity had total income of $315.6 million in 2015-16 and paid no tax.
* 67% ($224 million) of Allity’s
revenue was from government funding in 2016-17.
*
Regis, Estia, and Japara are listed on the Australian Securities Exchange (ASX)
but appear to be using methods to reduce the amount of tax they pay while
earning large profits from over $1 billion of government subsidies.
*
Family owned aged care companies (Arcare, TriCare, and Signature) receive
between $42-$160 million each in annual government subsidies but provide very
little public information on their operations and financial performance and may
use accounting methods to avoid paying tax.
* (All figures quoted above are in AUD)
*
The Australian Government and the Federal Opposition (the Australian Labor
Party) have proposed several ways to fix the problems with companies avoiding
tax by using trust structures and other methods but there are still loopholes.
*
It is difficult to get a detailed and complete picture of the full extent to
which these heavily subsidised aged care companies are avoiding paying as much
tax as they should, because Australian law is not currently strong enough to
ensure that their financial records and accounting practices are publicly
available and fully transparent.
Conclusion
The
six largest for-profit aged care providers in Australia received over $2.17
billion AUD in annual tax payer funded subsidies which provided after tax
profits of $210 million AUD. The actual operating profits were much larger.
These providers only paid around $154 million AUD in tax in 2015-16. Companies
that receive millions of tax payer dollars via Australian government subsidies
must be required by law to meet higher standards of transparency in financial
reports and be publicly accountable. The report calls upon the Government,
Opposition, and cross-bench Senators to work together to make laws to stop aged
care providers from avoiding the taxes they should pay and provide clear
records of their business dealings.
The
Tax Justice Network – Australia strongly supports recent government legislation
that has been introduced to close loopholes in the Multinational Anti-Avoidance
Law and government reforms to stapled structures. However, there is still a
need for additional transparency measures. The Tax Justice Network – Australia
also strongly supports a policy proposed by the Australian Labor Party to
introduce minimum taxation of discretionary trusts. These reform measures are
examined in more detail by this report in the section: Current Reform Measures.
This
analysis of tax payments and corporate structures of the largest for-profit
aged care companies provides clear evidence that simple common-sense reforms
are needed immediately to restore integrity to the tax system and to ensure
public accountability on billions of dollars in government spending.
RECOMMENDATIONS
FROM THE REPORT
Any
company that receives Commonwealth funds over $10 million in any year must file
complete audited annual financial statements with Australian Securities and
Investments Commission (ASIC) in full compliance with all Australian Accounting
Standards and not be eligible for Reduced Disclosure Requirements. Public and
private companies must fully disclose all transactions between trusts or similar
parties that are part of stapled structures or similar corporate structures
where most or all income is earned from a related party and where operating
income is substantially reduced by lease and/or finance payments to related
parties with beneficial tax treatment.
Australia’s
Largest For-Profit Aged Care Companies
In
Australia, non-profit providers collectively operate a majority of residential
aged care beds. However, the market share of large for-profit providers
continues to grow rapidly. Likewise, the influence of for profit providers on
shaping government policy and influencing broader trends in the aged care
sector has never been greater. Ranked by the number of government allocated
residential aged care places (beds) in 2017, the six largest for-profit aged
care companies in Australia are; Bupa, Opal, Regis, Estia, Japara, and Allity.
Combined, they operate over 20% of all residential aged care beds in the
country. These companies continue to expand market share through new
developments and acquisitions. These companies are also expanding to provide
more retirement living and home care services, which allow access to additional
government funding. In the most recent financial year (2016-2017), these six
for-profit aged care companies combined received over $2.17 billion in
government subsidies.4 This made up 72% of their combined total revenue of over
$3 billion.5……
COMPANY
SNAPSHOT
Bupa:
A United Kingdom-based mutual insurance company with global operations
including aged care services. Australia is Bupa’s largest and most profitable
market.
Regis,
Estia, and Japara: Public aged care companies listed on the ASX.
Opal:
A private aged care company owned by subsidiaries of two listed companies, AMP
Capital and Singapore-based G.K. Goh.
Allity:
controlled by Archer Capital, an Australian private equity firm with large
foreign pension fund investors.
Arcare,
TriCare and Signature (formerly Innovative Care): three family-owned,
for-profit aged care companies.
NOTE:
1. The Tax Justice Network -
Australia is the Australian branch of the Tax Justice Network (TJN) and the
Global Alliance for Tax Justice. TJN is an independent organisation launched in
the British Houses of Parliament in March 2003. It is dedicated to high-level
research, analysis and advocacy in the field of tax and regulation. TJN works
to map, analyse and explain the role of taxation and the harmful impacts of tax
evasion, tax avoidance, tax competition and tax havens. TJN’s objective is to encourage
reform at the global and national levels.
Membership of the Network can be found here.
Tuesday 24 April 2018
Repeat after me: Australia is a low-taxing country, a low-taxing country.....
“Australia
is a low-taxing country. While tax debate in Australia tends to focus on tax
rates, with endless comparisons of different countries’ rates of different
taxes, these debates ignore the fact that Australia raises far less tax revenue
than most developed countries.
This is
not a problem in itself. There is no right or wrong level of taxation. However,
the level of tax revenue raised inevitably affects governments’ ability to fund
essential services such as health, education, social security, defence and
infrastructure. Polling consistently shows that the Australian public would
prefer higher levels of spending on public services than lower tax collection.” [The Australia Institute, 17 April 2018]
So Prime Minister Turnbull and Treasurer Morrison will ignore polls like this one, because the only voters with influence are found in the ranks of political donors, big business and industry.
The Australia Institute, 18 April 2018:
Small government has
small support - National poll
A large national poll of
1,557 Australians, released today by think tank The Australia Institute, has
shown 64% of people want more public spending funded by tax revenue. Just 11%
want lower taxes and less public spending.
*
Two-thirds (64%) said they would prefer more public spending, funded by more
tax
revenue, and less inequality.
* Only 11% said they
wanted lower public spending, lower tax and more inequality.
* A majority of voters
for all parties selected the more spending and more tax option:
*
56% of both PHON voters and Other voters;
*
60% of LNP voters;
*
71% of ALP voters;
* 75% of Green
voters.
Polling Brief - April 2018 - more or less spending tax inequality.pdf
P521 Australia a low tax country.pdf
Sunday 8 April 2018
Australian Taxation Commisioner discreetly warns staff to keep their mouth shut when approached by ABC Four Corners reseachers
ABC TV airs “Mongrel bunch of bastards”, the Four Corners/Fairfax investigation into the Australian Taxation Office (ATO) on Monday 8 April 2018 at 8.30pm.
At least one ATO employee appears to have talked with some of the journalists involved in the investigation. His home was recently raided by the Australian Federal Police accompanied by an ATO investigator.
The ATO is not happy and issued this warning to all staff.....
Image via Twitter
Saturday 31 March 2018
Quotes of the Week
"the average
tax evader may be financially better off even after they're caught and
penalised" [Chris Leech, writing about low tax
evasion penalties applied by the
Australian Taxation Office in an unpublished study, quoted in The Age, 24
March 2018]
“Civil
disobedience and protest are vital in a democracy. They open up political space
for communities to intervene when the doors of governments are closed to them,
and the price of entry to corporate boardrooms and political party fundraisers
is beyond reach.” [Barrister
Julian Burnside writing in The
Sydney Morning Herald, 25 March 2018]
Friday 30 March 2018
Corporate tax cuts lead to 'jobs and growth' in Australia? Pull the other one!
This Business Council of Australia survey
was apparently mothballed when initial results indicated that it would reveal
the truth about outcomes flowing from the Turnbull Government’s planned
corporate tax cuts - a distinct lack of jobs and wages growth.
Financial
Review, 27
March 2018:
Fewer than one in five
of Australia's leading chief executives say they will use the Turnbull
government's proposed
company tax cut to directly increase wages or employ more staff,
according to a secret survey conducted by the Business Council of Australia.
More than 80 per cent
said they would either use the proceeds to boost returns to shareholders or
invest in the company.
The explosive revelation
comes as the government is
still struggling to secure the final two Senate votes needed to pass
the remainder of the $65 billion package.
The survey follows a
letter to all Senators last week by the BCA and 10 of the nation's top
chief executive officers in which they pledged to reinvest the proceeds of the
tax cuts with the ultimate aim of increasing wages.
"If the Senate
passes this important legislation we, as some of the nation's largest
employers, commit to invest more in Australia which will lead to employing more
Australians and therefore stronger wage growth as the tax cut takes
effect," the letter said.
But The Australian
Financial Review has learned that the BCA directly surveyed the chief
executives of its 130-plus members about a company tax cut this year, in the
wake of the company tax rate cut in the United States.
The chief executives
were asked which of four options they would nominate as their preferred
response to the company tax cut in Australia.
These were: returning
funds to shareholders; more investment; increasing the wages of their existing
workforce; or increasing employment.
More than 80 per cent
nominated one of the first two options while only 16 per cent to 17 per cent
nominated higher wages or employment.
The survey results are
understood to have been tightly held but were reported on internally in a memo
entitled "the good news and the bad news".
A spokesman for the BCA
confirmed the survey to the Financial Review on Monday but downplayed
its significance…….
This lobby group has now decided that 'spin' is more important than fact and senators have all received a BCA video appeal promising well-paid and meaningful jobs and wages growth that only growing investment can deliver if the comapny tax cits are passed.
A neat trick given that its members are also arguing before the Fair Work Commission Annual Wage Review 2017-18 that the minimum wage should remain as is or only be increased by 34-35 cents an hour which represents no growth in real wages.
The vague, slyly worded non-promise to lift workers wages received by Senators
via @Tony_Burke
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