Personal tax cuts
My take is that if you did the second, then you probably could raise the scale to where no tax is paid to $50,000 (or more - the revenue neutrality concept). When people on this forum talk about the top 10% pay more than 40% of total tax take what they conveniently forget is that most of these people are PAYG workers (and the super rich are not PAYG workers hiding behind trusts etc etc). Would you call someone in Sydeny on $200,000 a year with a $800,000 mortgage and two kids super rich?
PAYG workers may have negatively geared property but not a host of it like others in trust - my preference on NG is that it be capped to $20,000 regardless of how manyhouses you own (i.e. that is those PAYG workers getting ahead can but those with more than 1 house don't get subisidised by taxpayers because the argument over NG is you recoup the money when CGT is paid but those who put homes in trusts to be frank pretty well never sell them).
Who should have the tax burden reduced is PAYG workers btw so your second point will bring more of those minnimising tax to pay their share (and whatever they do must ensure the taxpayers, liek multinationals, find convenient ways of parking money offshore). 35% tax rate at $20,000 is too high given our cost of living so revenue neutrality the concept and bump the tax free rate to a higher level - noting low income earners (and I am now throwing into that category anyone under $50,000 per year because quite frankly the cost of living here is too great IMO) might ensure the tax cuts will achieve the objectives of stimulating growth (and to do that also need to ensure tax cuts at the higher end are directed at productive as against unproductive investments).
Company tax cuts:
The Laffer curve doesn't work and secondly our primary tax reliance is on income earners through the personal income tax system, not company tax. On tax competitiveness, the USA and UK have similar tax rates to us (and USA has state company tax to). Don't forget the USA levies income tax at the State level. The generous tax concessions in Oz, and an inability by govt to tax income at source because bluntly they are too gutless to do the right thing - tell me about Singapore's mining industry and tell me where they mine iron ore there but yet iron ore profits are shifted there LOL - and then they say lets kill the poor and tax PAYG workers to the hilt. Even WA is useless, they increased my electricity bill to the hilt but the Opposition who blocked a royalty increase in the upper house said oh a $20per ounce royalty rise will kill the industry LOL when gold companies are making a killing so lets make the workers subsidise the companies.
And don't forget imputation and how that works in Oz- there is no double taxation of dividends here that occurs in the rest of the world - i.e. dividends are taxed at full marginal tax rates in the USA etc etc.
Anyway, here is some latest links showing the level of didley squat most companies pay in corporate tax. Oh yeah lets reduce the company rate so those who decide to give us a few scraps in tax can give us stale bread instead. No wonder the budget is in a mess on the revenue account before we even talk what is the issues in the spending side.
http://www.abc.net.au/news/2018-02-...ian-companies-havent-paid-in-10-years/9443840
http://www.abc.net.au/news/2018-02-14/company-tax-rate-cut-arguments-missing-evidence/9443874
Ronald Reagan started this aspect and bulldust on Laffer - i.e. IMO Laffer works nowhere near what people think - and that put the USA into significant debt in the 1980s, debt that continues to grow there. Why doesn't the Laffer curve work - well the money just ends up offshore or into unproductive investments (such as NG) and right now given housing affordability issues (and people concerned with losing their jobs) it goes straight into the mortgage given the significant rise in housing to income ratios when compared to the 80s.
The Laffer curve could work if the govt had other triggers that made the excess profits moved to productive investments but it is too gutless to move in that area - that is closing offshore tax minimisation loopholes and unproductive investments such as NG. As Packer once said I don't like paying tax full stop - that is it is irrelevant what the rate is for some. So cutting taxes will not lead to the growth the govt anticipates that will balance the budget LOL unless it addresses other issues which it is too gutless to address. As I said many times before, the budget won't be going back into surplus in the next 10 years unless we have a commodity boom so get use to Commonwealth Government paying some $15 billion - $20 billion in interest payments in its debts.
As I am PAYG, I am happy to support the needy, but not the greedy.
The laffer curve is a failure because by not putting in place disincentives to invest in unproductive investments (i.e. investment housing is one) means tax cuts do not grow an economy by putting in place arrangments which direct investments to productive sources.
All IMO
