crocodile wrote on Apr 23
rd, 2017 at 10:16am:
Bam wrote on Apr 23
rd, 2017 at 10:10am:
crocodile wrote on Apr 22
nd, 2017 at 2:32pm:
Would have been a win-win for everyone if instead the penalty rates were kept and the corporate tax rate lowered.
The doctrine of neoliberalism is dying. One day you'll understand this.
Companies MUST pay their share of tax because they are voracious consumers of infrastructure and services that must be funded by taxpayers. 3% of gross turnover is not a high rate of tax. If anything, company taxes need to be increased, not lowered. The way we increase company taxes is to start scrapping the huge numbers of corporate tax loopholes that are not needed. Company tax breaks that were needed when company tax rates were 49% are simply not justifiable now. We may also need to increase the tax on profits, or introduce new efficient taxes on business so more inefficient taxes like payroll tax can be scrapped.
What we need to do instead of lowering business taxes is invest money in lowering business costs. It's not government taxes that are the biggest drain on corporate expenses, but private taxes from privatisation. Privatisation has failed because it has increased costs to many businesses more than reductions in company taxes have lowered them, and this is a drag on the economy. Tolls from toll roads, soaring energy prices and massive increases to fixed service charges are some examples of privatised taxes on business that can be lowered. Renationalising would allow the scrapping of tolls and fixed charges and would remove the privatised constraints on energy supply, among other benefits. If business taxes were increased to 50% of profits (equivalently, 5% of turnover on average) and the funds raised were used to renationalise all of these expensive privatised services, many businesses would actually be better off.
It has precisely zero to do with neoliberalism.
Rubbish. One of the core tenets of the neoliberal doctrine is a manic determination to lower business taxes. That is also a common theme in many of your posts - lower company taxes, lower company taxes, blah blah blah. You consistently miss the big picture: businesses require government-funded services like everyone else and should be expected to contribute to funding them.
You are confused. Whether it is part of neoliberalism thinking is rather irrelevant as it is not my motivation for advocating a lowering of corporate tax. It is indeed yourself that doesn't see the big picture. As stated many times already, the important consideration is not who has the legal obligation to pay a certain tax but who bears the burden of the tax. Overwhelmingly it has been shown that the burden of corporate tax falls more heavily on the workers than it does on the owners of the capital. I've even cited quite a few references to this. Hardly a doctrinaire neoliberal motivation.
crocodile wrote on Apr 23
rd, 2017 at 10:16am:
It is nothing more than the recognition of who bears the burden of the taxes. One day you'll understand this.
You still keep banging on about turnover. Taxes are paid on profit. One day you'll work this one too.
That is incorrect.
Business taxes are not always paid out of profit. Payroll tax is not paid on profit. Land taxes are not paid on profit. There are other business taxes that are also not paid on profit, in fact, the majority of taxes on business have nothing to do with profit when levied.
To the best of my knowledge I have commented only on corporate taxation. I've never even mentioned land or payroll taxes. Payroll taxes should go anyway. Land taxes, I have no great objection to but these are a different matter.
Yes, I have advocated a turnover tax on businesses. So what? The idea behind that tax proposal is as a means to reduce the tax burden on businesses, not increase it, by allowing businesses to bank the savings of lower compliance costs while the governments do not lose revenue overall.
They're called cascading taxes. A small percentage is levied at each point in the production chain from primary producer to the consumer. For large firms like Woolies or Wesfarmers the solution is a rather simple one. Vertically integrate backwards along the chain either buying up the suppliers or creating your own production units. This way, the tax is levied only once. Smaller entities that cannot integrate in this way end up paying the tax on goods that have already been taxed numerous times, can't compete and are driven out of business. Left standing are just a handful of large corporations paying the tax only once and revenue collapses.
This is precisely what happened throughout Europe a century ago and is the reason for the implementation of VAT.
Not one of your best and brightest ideas.