John Passant takes a look at franking credits and explains what all the fuss is about.
The federal Coalition government's so-called "tax reform" package is, overall, a major escalation of the capitalist class war by the rich against the poor and working people.
The initial tranche of income tax measures will reduce tax by a very modest amount for low-income taxpayers, but the long-term effect of the package is to massively reduce tax on the wealthy and attack the elements of a progressive taxation system established in this country over many years.
Multinational gas corporations are expected to sell $50 billion worth of Australia’s liquefied natural gas (LNG) overseas every year, but it will be at least 10 years before the national treasury receives any rise in tax revenue. Even then, many projects will never pay any tax to the government for the resources they export.
A report prepared for the federal government into the operations of the Petroleum Resource Rent Tax (PRRT) shows that revenue from the offshore gasfields will remain static until at least 2027.
Yet again, the federal Coalition government has launched a broadside in favour of its plan to cut company tax for big corporations from 30% to 25%, while slashing spending on social welfare and the public sector.
The catalyst for the latest controversy on the issue was a February 14 article on the ABC website by chief economics correspondent Emma Alberici, entitled, “There's no case for a corporate tax cut when one in five of Australia's top companies don't pay it.”