I suspect that when it was first introduced, payroll tax was specifically intended to encourage inefficient firms to upgrade their plant and modernise their operations rather than simply hiring extra labour if their workload increased. At the time, that would have made good sense. In today's "boom" climate (soon to end) that still makes sense

Are you for real?

Now just let me get this straight. You actually think it is better for our economy for business to upgrade their plant and hire less employees.

As for labour hire it is a no fuss, non direct employment option at no additional cost to the host employer as the cost is passed on to the end client. This is why it is so popular within certain industries and less popular, in retail for instance' as consumers will not wear the extra costs involved.

Blame unfair dismissal laws for this beauty!
As for your prediction of 'the end of the boom time' there is one simple answer that will defy your logic and that is CHINA & INDIA.

China is expanding at a rate of one and one quater times Brisbane per month and we are the preffered supplyer of comodities.

That is provided the 'do-gooders' don't scare our mining compnies away from employing our own people.

They will continue to mine, sell and enjoy their spoils but without us enjoying the cream.

This is the only way I see our 'boom times' ending within the next few years.

Back to pay roll tax, you really need to speak to someone who pays it to understand the frustration it causes.

rehctub: "You actually think it is better for our economy for business to upgrade their plant and hire less employees. "

In the current economic climate it may well be. Tried to get skilled staff lately? For an example of how well a concerted program of upgrading equipment works to boost an economy, look up the Marshall Plan. No country can expect to be able to compete in terms of productivity with outdated equipment and it is relative productivity that ultimately creates prosperity - a country able to produce more per worker will be richer.

As for the "boom", sure it will last for an extended period in some industries, but in the rest of the economy it is already fading fast. Any business that is too heavy with insufficiently productive labour will suffer. Note that I said "insufficiently productive" when responding please.

rehctub:"As for labour hire it is a no fuss, non direct employment option at no additional cost to the host employer as the cost is passed on to the end client."

Funnily enough, the labour hire firms seem to be able to make a profit whilst paying payroll tax.

rehctub: "Back to pay roll tax, you really need to speak to someone who pays it to understand the frustration it causes."

Lots of things are frustrating, yet we accept their existence as necessary. I find it difficult to feel too sympathetic to the frustrations of someone with sufficient employees to become liable for payroll tax.