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Joe Hockey and The Tax Attacks – Part 1

According to Joe Hockey, a lower company tax rate “would reduce the incentive for tax planning and profit shifting from Australia.”

Of course, this argument has been used before. Two of George W. Bush’s economic advisers suggested that tax cuts for the rich would reduce their desire for tax avoidance, leading to a better overall revenue take for the government. So how successful was this?

Well, according to John Quiggin in Zombie Economics:

“Subsequent work found that the results of Feldstein and Lindsey were overstated, and led to the commonsense conclusion that best way to minimise tax avoidance was to tighten up on tax loopholes and tax havens.”

But it’s an interesting concept being floated by Joe. Companies making billions of dollars – which is a lot of money, in case you, like Barnaby Joyce – don’t have the concept of a billon – have the need to squirrel their profits into some offshore company to reduce their tax bill to almost nothing. However, if we charged them slightly less, then they’d happily pay it, forgoing some of the billions in tax they’re now avoiding.

Yeah, Joe, you’ve convinced me! How about we apply the same logic to other areas of government.

For example, we could double the minimum wage to increase the incentive for people to work.

And, education. We could eliminate the need for students to cheat on their exams by making the marks higher.

As far traffic goes, if everyone started work an hour later, they could miss peak hour. (Yes, I know, I’m just using Joe Logic here.)

What else? Ah, drug addicts often commit crimes to feed their habit. By supplying free drugs we could quickly halve crime statistics.

No, that’s last one’s just silly. If an addict breaks the law, he should be punished. We shouldn’t be providing ways for him or her not to break the law. (Unless, of course, their addiction is to money.)

Ah, I have it. We want to reduce emissions, so instead of punishing or fining the biggest polluters, we’ll give them money, not to put as much carbon dioxide into the atmosphere.

(Although, I can’t see why we’re worried about carbon dioxide being put into the atmosphere, because as someone argued, it’s a naturally occurring thing, necessary for life, so how could it be harmful? Yes, it’s just like that silly requirement for pool fences because water is a naturally occuring thing, necessary for life, so how could anyone drown?)

Anyway, I’m looking forward to the next Budget, because I wrote a few months ago, the new plan from Joe and Tony is to argue that they’ve pretty much fixed up the Budget mess, give us some nice surprises, then call an election before the polls head south. With what they hope is a more compliant Senate, they can ram through the nasties in their next term of office. And, if they lose the early election, at least Tony will have achieved his main aim.

Stopping Turnbull becoming PM!

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6 comments

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  1. David

    So after bleating for 16 months the lie Labor left this bunch of fools such a shocking mess with the deficit in absolute free fall, the world was about to end, suddenly even though Hockey has added another 45 billion to it, spent like there is no tomorrow (perhaps he is psychic) all is now milk and honey.
    The hide on these incompetents is so thick, they are the epitome of the occupants of the land of make believe with an abundance of outright lies thrown in.

  2. Terry2

    Interesting isn’t it, how Joe and Tony want to enforce an existing law which forbids non residents from buying existing housing stock.

    Wouldn’t you think that these people – call them aliens – would have paid for advice from their lawyers and real estate spruikers to find a way around Australian law perhaps by buying housing through a proxy. I think if you inspect these contracts you will find a resident ‘proxy buyer’ as a party to these contracts and if you look a little deeper you will find a collateral ‘letter of comfort’ whereby the resident proxy relinquishes all claim to the property.

    Or do you think we are about to see a raft of court actions against said lawyers and real estate spruikers for failure to disclose to their clients – the aliens – the full implications of Australian law ?

    So, it begs the question, why are we granting an amnesty for those who have already breached existing Australian law ?

    ” Treasurer Joe Hockey said investors can avoid prosecution if they come forward by November 30.
    “I say to foreign investors, you have until the end of the year to declare yourselves,” he said.
    “If you do not come to us, we will come to you because eventually we will find those people that have engaged in unlawful acquisition of Australian real estate and we will prosecute you and we will be very hard about it.”

    It seems, Rossleigh, the same sort of thinking that you have noted above : I wonder , did they think of this all on their own or did they call in the FIXER !

    PS: Joe, 30 November is not the end of the year.

  3. Horatio

    Hockey’s lack of understanding of our tax system is astounding.

  4. kerri

    Why would anyone need to keep more money than they could possibly use?
    I mean there has to be a physical limit to how much money anyone can keep for themselves?
    Right?
    Theres only so much you can own or use or eat or drink?
    Why would anyone want to get more money than they can possibly use?
    One word!
    Gina.

  5. kerri

    Terry2 I think Joe’s “amnesty” is lazy politics! They won’t go after the investors like they threaten and having declared the amnesty will say they tried! And that will be the end of it. The feral Senate needs to put riders on evrything they can to force action and failure.

  6. lindsayms

    Hockey’s lack of understanding of our tax system is astounding.
    I am not convinced that any of them have an understanding of government

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