The Nick Xenophon Team’s Stirling Griff believes the Turnbull Government should focus on personal income tax cuts rather than extending company tax cuts to businesses with turnover of more than $50 million. Senator Griff says implementing the Government’s full enterprise tax plan would be “fiscally irresponsible” and the economic benefits are uncertain. From The Australian:
Senate crossbenchers, including the key Nick Xenophon Team bloc, have rejected the need for new company tax cuts…
The crossbench opposition sets the scene for another Senate blockade in the New Year, with the prospect the Turnbull government will be unable to drive the remaining company tax cuts through this parliament…
NXT senator Stirling Griff confirmed his party remained opposed to the government’s unlegislated company tax cuts for businesses with more than $50 million in annual turnover…
“We do not support the proposed tax cuts for big business as this would be fiscally irresponsible and the economic evidence is questionable. The priority should be giving relief to families, with personal tax cuts.”
With Labor and the Greens also against the expanded company tax cuts, the government would need to win the support of 10 of the 12 Senate crossbenchers to reduce the tax rate from 30 per cent to 25 per cent by 2027 for all companies. That makes the support of One Nation and NXT crucial to the bill’s success…
Senator Hanson, who leads a bloc of three senators, previously has indicated her preference to block tax cuts for big business…
The fiscal cost of reducing the company tax rate to 25% from 30% would be immense – initially estimated by the Treasury at $8.2 billion a year once fully implemented – because large foreign-owned businesses that are not subject to Australia’s dividend imputation system would also receive the cuts. For these foreign-owned business there would be no offset in the form of lower franking credits, therefore, a company tax cut would represent a financial windfall from Australian tax payers, hence lowering Australia’s national income.
The Senate is doing the patriotic thing by continuing to oppose the Coalition’s company tax cuts. There are far better ways to spend $8 billion of scarce taxpayers’ money.
