Sep 4, 2017

Corporate tax cuts to drive CEO windfalls, not jobs

What do companies that pay less tax do with the money? The US experience is that little of it goes to investing in new jobs. Instead, CEOs benefit.

Bernard Keane — Politics editor

Bernard Keane

Politics editor

Recession in Australia

A new US report suggests that the tax cuts the government is anxious to give to large companies will end up in share buybacks and larger CEO remuneration rather than new investment and new jobs.

The Turnbull government remains committed to giving Australia’s, and the world’s, largest companies a huge tax cut that would drop their tax rate from 30% down to 25% over the coming decade, at a cost of over $60 billion in foregone revenue. The government, and business lobby groups like the Business Council of Australia — whose members already pay, on average, less than 25% tax — insist that the tax cut will increase investment, increase economic growth, increase employment, increase productivity and increase workers’ wages.

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13 thoughts on “Corporate tax cuts to drive CEO windfalls, not jobs

  1. John Hall

    Just reinforces that the Libs are in thrall to the Corporate end of town. Their economic mismanagement is already proof of that. It’s all smoke and mirrors trying to scare us about terrorists under the bed and homosexuals in it. The scary thing is that a lot of us have fallen for the crap. Wake up Australia and kick the Government out of its bed before we all get bed bugged to death.

  2. Dog's Breakfast

    It’s all such transparent rubbish, but if you have a media mogul who pays no tax supporting it then you have a solid chance of promoting these obfuscations.

    Employment rates and investment decisions are only marginally, peripherally associated with tax rates. It is a lie, always was.

  3. klewso

    I want to know what Turbott and his travelling circus (Little Eejit et al) is going to do if this snake-oil doesn’t grow the employment strands on the billiard ball of the economy, that he’s promised it will.

    1. klewso

      Moderation? Seriousl?

      1. klewso

        9 hours in Moderation?

  4. leon knight

    Turnbull and Co are well aware of the source of the really big LNP donations (and post politics job offers), and are perfectly comfortable lying through their teeth about it.

  5. zut alors

    Surprise, surprise. It’s astonishing how this hogwash of tax cuts creating jobs is accepted as fact. The Labor party should condense a few of the statistics presented in this piece – put it in layman’s language & hammer the point to the public.

    1. Will

      What on God’s good Earth makes you think for a single microsecond that the Labor Party cares about the layman? They gave up on the layman decades ago! Now, they’re solely about chasing the financial support, undemanding votes, and best of all board appointments, that traditionally only Liberal-supporting cohorts got a shot at. Hence, Labor won’t oppose these tax cuts as unjust; they’ll oppose then as unpopular. The only thing that matters to them is what sells. And guess which cohort they got that idea from?

      1. AR

        Alas, too true.
        When/if bumBoilShlernt and his apparatchiks attain office, there will not be an iota of change.

    2. drsmithy

      Tax cuts could potentially drive new jobs if they went into generating more demand.

      So keep an eye out for anyone suggesting a “tax cut” for the lowest earners, by raising the tax-free threshold. That’s someone who doesn’t believe in trickle-down economics.

  6. Bill Hilliger

    The LNP know that the average working class Australian has too much money, the rich and privileged class does not have enough, they always need more money. The LNP are working very hard to make the rich and privileged class happy so the donations to the LNP keep rolling in. It’s called the “trickle up effect”.

  7. CML

    So…which is it?
    Does the L/NP NOT know about these stats, and are therefore grossly incompetent? Or do they indeed know about them, and are lying to the Australian people?
    They can’t have it both ways!!

  8. AR

    And, in breaking news, water flows uphill and the pope shits in the woods.

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