ALS: thoughts on freedom

7 Comments

1. This is a bit of a dilemma. I sometimes espouse contrarian thinking, so maybe Australia should increase its’ taxes, all round? Under the reign of Kevin the Red, that could be what we end up doing!

   Comment by nicholas gray | June 8, 2007

2. Corporate tax rates aren’t really important for multinationals or small firms. Medium sized firms who can offshore completely are most likely affected.

   I have it on good advice that Esso exited Australia because of outrageously high excise and mineral extraction taxes.

   Comment by Mark Hill | June 8, 2007

3. One idea for company tax is to make re-invested profit non-taxable. I believe they did this recently in Estonia.

   Anonother idea: If we can get personal income tax down to the company tax rate there would be an argument for simply abolishing the company tax and having all tax paid by individuals.

   Comment by John Humphreys | June 9, 2007

4. I would start by eliminating payroll tax. In our business of around 50 full time staff about 30% of our annual tax bill is for the pleasure of employing people.

   A similar amount goes toward the rort that is WorkCover. Given the huge premiums and the relatively insignifcant claims we have made over the past 7 years, it’s hard to imagine a free market not being able to offer a similar standard of cover for way less.

   Next I would raise tax thresholds so employees could keep more of what they earn. This would improve motivation to work and increase productivity.

   Now we have people working and producing, I would lower capital gains tax so we could accumulate capital and savings thereby increasing production.

   Lowering company tax is probably last on my list. If all the obstacles are removed from creating wealth then paying 30% of what we can earn will be not so bad.

   Comment by Peter G | June 9, 2007

5. Provided company earnings cannot be used as de facto private income, I see no reason why companies should be taxed at all. Reinvesting earnings will result in additional profits and employment, etc. Distributed profits will be taxable in the hands of recipients except for foreign shareholders, for which a withholding tax would suffice.

   Of course, payroll tax should be abolished and workers comp opened up to market forces as well. They are both complete rorts.

   Comment by DavidLeyonhjelm | June 9, 2007

6. When Joh promoted the idea of abolishing death tax and succession tax, Labor claimed it would be the ruination of Queensland, and would benefit the federal governmment to the disadvantage of our state.

   Shortly after he did it the other states were racing to fall in line.

   Comment by Jim Fryar | June 10, 2007

7. I think that a company tax reform along the lines of what Estonia has would be enormously beneficial. It allows companies to self fund their expansion rather than rely on debt. A lot of small businesses are keen to expand but not keen to take on debt which generally requires some sort of personal guarantee.

   Essentially there should be no tax on company profits. It should be replaced with a simple withholding tax on dividends. Where the dividends are paid to another Australian company that company should get a full refund on the tax withheld.

   More on the Estonian tax system:-

   http://www.pwc.com/extweb/ncpressrelease.nsf/docid/9993BF9B2E3F0C2A8025711D006272C0
   http://www.free-europe.org/blog/?itemid=246

   Comment by terje (say tay-a) | June 13, 2007

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