In that case perhaps we should take into account the level of subsidies that our overseas competitors receive when determining such things as tariffs and import quotas. Tax imports and use the money to subsidise our own producers.
Why not follow the Swiss and bring in broadly based wealth taxes.
The tax base for the wealth tax is net wealth, i.e. gross wealth reduced by the sum of the taxpayer's documented debt as well as personal allowances and social deductions that vary from canton to canton.
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The best idea is just to tax the profits, as we do now,
Yes, fine, as more companies are shifting profits offshore and avoiding tax.
There is ways to reduce that, and they are far less complicated than your system of over taxation, and tariffs and subsidises etc
That sort of tax seems silly, different peoples net worth have very different earnings profile.
I mean a farmer that owns a farm worth $1M, might not earn very much on that capital, and a lot of that earnings is the result of labour.
Where as another guy that owns $1M worth of computers, might have a website earning $1M a year.
It would be like charging company tax based on the book value of the company, obviously different industries earn different amounts on the capital invested in them, Woolworths earns 26% on its equity others struggle to 5%.
The best idea is just to tax the profits, as we do now,
There is ways to reduce that, and they are far less complicated than your system of over taxation, and tariffs and subsidises etc
There is ways to reduce that, and they are far less complicated than your system of over taxation, and tariffs and subsidises etc
Please tell us what these measures are, and more importantly, pick up the phone to Joe Hockey and tell him, because he's bottled out on trying to reduce company tax avoidance.
Also makes it harder to loophole your way like the rich in Australia to paying very low % rates of tax.
Give me an example of a situation you wish to stop.
I mentioned offshore profit shifting by companies and you said that there are measures that could be taken to stop this, so what are they ?
And I said give me an example of the "offshore profit shifting" and I will tell you.
When they take a bunch of materials and build a phone or an ipad, they are generating a lot of value, Having a structure that shifts that value to another entity, and then that entity supplies that ipad or iphone to their retail arm in Australia at a whole price rather than letting it flow through at the manufacture cost, does generate a lower profit for the retail arm, but that's ok because that retail arm wasn't responsible for the value generation in the first place.
If it can be shown that a local company is setting up an offshore agency simply to avoid tax, this could be shown to be tax avoidance and the company could be prosecuted accordingly. Just start testing some big name Aussie companies that are involved and hit them hard as a deterrent.
Even still though the companies revenues would still be generating tax dollars because their employees will be paying tax, they will be paying gst, land taxes, and spending dollars in other ways that generate taxes.
But yes, we could outlaw (I think they already are outlawed) schemes designed to avoid tax.
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I see nothing wrong with a company like apple using systems to raise the whole sale price that they supply their products to their Australian division to keep some of the profits offshore, Because the biggest chunk of the profits are being generated offshore.
When they take a bunch of materials and build a phone or an ipad, they are generating a lot of value, Having a structure that shifts that value to another entity, and then that entity supplies that ipad or iphone to their retail arm in Australia at a whole price rather than letting it flow through at the manufacture cost, does generate a lower profit for the retail arm, but that's ok because that retail arm wasn't responsible for the value generation in the first place.
That's fine for the company, but if we as a country are just buying stuff from overseas, how are we earning the money to pay for it ? The minerals boom won't last forever as we have recently found out, so what's the substitute ?
that's up to us to find things to export over seas, Mining, tourism, food, media content, financial services, health care products whatever you can think of. the world is your oyster so to speak.
I am a glass half full kinda guy, I see a world of opportunity, and am actively investing in it.
I don't believe in mercantilism, I think the global economy is a great thing.
How does a local specialist IT firm compete when they're paying full tax within Australia? Shouldn't there be at least some resemblance to paying a market rate for the various IP the likes of Apple and Google are charging? .
How doe sa smallish company like STW communications compete against Google or Yahoo where they can sell similar advertising and not pay local taxes?
I'm sick of the mining sector counting royalties as taxes to try and make it look like they're paying a lot of tax. It's like an Airline treating staff as a tax, or a farmer treating the cost of seed as a tax.
There may be a few niche markets out there, but nothing that is going to employ large numbers of people.
and you have already promoted production going offshore, so what is there to sell ?
In the end, the only market we can depend on is our own. We should satisfy that first before we start thinking we can take on the big boys
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