Tax cuts to worsen inequality, Oxfam says
Oxfam Australia have been hitting parliament house to campaign against the federal government’s proposed corporate tax cuts. The NGO’s Fair Economies Advocacy Manager, Joy Kyriacou, has issued a statement suggesting that the tax cuts would worsen inequality in Australia.
“The proposed $65bn hand-out for big business would make Australia the latest country to join the global race to the bottom on corporate tax rates,” Ms Kyriacou said.
“Slashing the corporate tax rate would undermine attempts to tackle inequality and poverty, both in Australia and around the world. When governments enter a race to the bottom on corporate tax rates, everyday people lose.”
“It is utterly inconceivable that the federal government wants to push ahead with slashing the corporate tax rate when Australian Taxation Office data shows that more than one in three large Australian companies paid no tax at all in Australia for the past three years of reporting,” Ms Kyriacou said.
“Passing the corporate tax cut for large companies would be a further step in unravelling the fairness of our tax system.”
“Right now, the use of tax havens and other loopholes by Australian multinationals is ripping billions of dollars from public coffers in developing countries, as well as in Australia.”
Oxfam estimates around $5-6 billion is lost to Australia’s public purse through the tax avoidance practices of multinationals. Global estimates indicate that the poorest countries lose well over $100 billion annually.
“This is money that should be spent on the things everyday people need: schools, hospitals, roads, and public infrastructure,” Ms Kyriacou said.
“It would also be completely nonsensical to promise a crackdown on multinationals that are avoiding paying their fair share of tax in exchange for rewarding big business with these tax cuts.”
“And the stubborn push for these tax cuts comes with little evidence of benefits to the economy and community – and in exchange for no more than a ‘pinky promise’ that big business will invest more in jobs and wage growth.”
“What Australia should be doing is cracking down further on tax avoidance, including by introducing public country-by-country reporting that requires large companies to declare details of income, taxes paid and profits around the world.”
The Turnbull Liberal Government aims to pass the corporate tax cuts by the end of this week, but does not appear to have the numbers.
The governments says that the tax cuts will ensure that Australia remains a competitive place to do business.
Jonathan Foye is Insights’ Editor