Why is it if a person has a strong opinion about something it is it is easily dismissed as hysteria?
Australia's international competitivenes WILL, not 'maybe', not 'won't', WILL be impacted by this tax, whether or not it's presented as progressive, fair or any other equally mediocre adjectives.
Why?
It decreases the rate of return an an investment over the long term. When companies are assessing how best to allocate their capital to generate returns for shareholders the rate of return on investment is usually the first consideration. Not last.
Does this mean the industry in Australia will come to a grinding halt? Of course not.
Does it mean there is increased uncertainty about future projects and investment in the industry? Yes.
Aside from the rate of return on projects diminishing the political risk in Australia has also increased. Investors like certainty and meddling by governments with respect to tax regimes throws up a big red flag when investment decisions are being assesed.
