I am not going to fully canvass what the following statistics means to every one of us.
Suffice to say that our everyday lifestyle would improve markedly; the health care of our people would not be a burden, we could afford the education of our next generation, infrastructure would expand......and small business would thrive again...............we just need our Corporate Serving Politicians to represent us and not stateless global corporations.

These are US stats....but it holds for the entire globe.

Corporate Taxes as a Percentage of Federal Revenue
1955 . . . 27.3%
2010 . . . 8.9%
Corporate Taxes as a Percentage of GDP
1955 . . . 4.3%
2010 . . . 1.3%
Individual Income/Payrolls as a Percentage of Federal Revenue
1955 . . . 58.0%
2010 . . . 81.5%

Of course, there has been some articles about how the middle income earner is now the main contributor to taxes, and this has occurred as the level of company taxation has fallen.

Don't forget the billions of dollars of untaxed profits made by religious corporations, and their refusal to even pay land taxes and local government rates.

Here's a scenario for you, sonofgloin. It might help you understand the relationship between corporate tax and personal tax just a little bit better.

Company A:

Revenues $1 million
Cost of Goods $500K
Wages: $400k
Premises, telephone/internet, insurance, advertising, office supplies, accounting fees etc. $100k
Net profit $0

Taxation on the above:

Corporate Tax $0
Personal Taxes paid by employees (approx): $88k
(add to this GST, stamp duties etc. paid by individuals...)

You figures could equally explain just how close to the bone US companies are running, because they spend so much on employee salaries...

Why do so many people think that increasing tax is the answer?

For every dollar raised in tax, only 66% goes back into the community (roads, hospitals etc ATO stats 2009)So, income tax is a drain on society.

If you lower income tax, Mr average will SPEND that money, the more money spent, the more GST revenue, more jobs , more people paying income tax. A win/win for everyone.

Why can't governments work within their budgets?.

Every business cant just increase prices because "we have blown our budgets" So why can't public servants get into their head, there is no endless supply of money.

Each increase in council rates/levys, each increase in state govt charges and each increase in income tax, causes more inefficiencies in our society. A third of revenue raised is wasted

Greetings Pericles, I do have a "working" understanding of corporate tax. When the board meets they are presented with an EBIT figure (earnings before interest and tax. This figure is minus all fixed costs and liabilities to be paid that current financial year.

Then they are presented with the taxable revenue figure.........regardless of your profit and loss calculations that figure was taxed at three times it current rate 40 years ago.

Given your defense of the corporate tax rate, why should small and medium businesses pay nearly 30% tax on their meagre profits while the corporate conglomerate opposing them in the marketplace has economies of scale the privateers only dream about pay 8%?

It doesn’t much matter what the rate of company tax is. The real taxpayer is the shareholder, not the company. Company tax works like a withholding tax. If the shareholder’s personal tax rate is above the company tax rate they pay extra tax on profits they receive; if below, they get a refund. Only foreign shareholders actually pay tax on company profits at the company tax rate.

You can be as defensive as you like, sonofgloin, the fact remains that there is absolutely no correlation between the facts of tax collection, and your conclusion that the burden falls unequally on the workers.

>>...regardless of your profit and loss calculations that figure was taxed at three times it current rate 40 years ago.<<

But that is a good thing, from the economy's point of view. These days, more of the company's revenue can be used to pay more and more workers, rather than giving it to the government.

The reality is that wherever extract your tax, that money goes into consolidated revenue. The difference is that when you tax companies, that money isn't available to develop and grow the business that employs people and creates value within the economy. Instead, it is extracted from the productive economy to pay workers in the "public service", whose only objective is to spend as much of taxpayers' money as possible.

And you do need to do some more homework on corporate taxation, too.

>>I do have a "working" understanding of corporate tax. When the board meets they are presented with an EBIT figure (earnings before interest and tax. This figure is minus all fixed costs and liabilities to be paid that current financial year. Then they are presented with the taxable revenue figure<<

Actually, it is profits that are taxed, not revenue.

Pericles>> You can be as defensive as you like, sonofgloin, the fact remains that there is absolutely no correlation between the facts of tax collection, and your conclusion that the burden falls unequally on the workers.<<

Defensive Pericles....it is an opinion forum.

>>Actually, it is profits that are taxed, not revenue.<<

Where do you think profits come from?........from revenue Pericles as I said “taxable revenue figure.”

There is no ambiguity in the percentages I quoted, no matter how much you cry “consolidated revenue” or voice some ridiculous extrapolation that because the corporations create jobs that are taxed they are by default paying their share of tax.

If you are paying one third of the tax you were paying 30 years ago you are keeping a larger portion of the taxable income.

Opinions are opinions, sonofgloin.

>>Defensive Pericles....it is an opinion forum.<<

But facts are also facts.

>>Where do you think profits come from?........from revenue Pericles as I said “taxable revenue figure.”<<

Of course they do. But - as I pointed out - "taxable revenue" does not exist, while "taxable profits" do.

>>There is no ambiguity in the percentages I quoted<<

I wasn't suggesting ambiguity. I was pointing out a fallacious argument - your suggestion that because firms are taxed less than they used to be, this is somehow disadvantageous to the workers. When in fact the lower tax rate allows firms to a) hire more people and b) pay them more. That is a fact, not an opinion.

>>If you are paying one third of the tax you were paying 30 years ago you are keeping a larger portion of the taxable income<<

"Keeping", sonofgloin? Where's your evidence that they are keeping it, as opposed to using it in their business?

From your comments, I would surmise that you have never actually been in business yourself.

That's an opinion, of course.

Pericles, if you believe there is any correlation between the amounts of tax paid by Fred, who employs a dozen people in his business and the multinationals, I have nothing to add that will sway you.

Regarding your comment that the corporate repay the nation in wages and employment, did you know that the global miners pay less tax in Australia than in any of their other global operations........and a fat lot of good it did us? Some despot in Africa hammered out a deal that gets more tax from them than we do.

Depends what you mean by correlation, sonogloin.

>>Pericles, if you believe there is any correlation between the amounts of tax paid by Fred, who employs a dozen people in his business and the multinationals, I have nothing to add that will sway you.<<

The volume is different, of course. So no "correlation" there.

But the principle, that the more taxation a company has to pay relative to its profits, the less is available to expand the business, employ more people, and to pay those people more wages, remains completely sound and unarguable. So much so, that I wonder why you are spending so much energy refuting it.

>>Regarding your comment that the corporate repay the nation in wages and employment, did you know that the global miners pay less tax in Australia than in any of their other global operation<<

Entirely different topic. But have you noticed how the miners have cut back on employment recently - some towns are now practically empty, and house prices/home rentals have collapsed. So even when they are (allegedly) rorting the tax system, they still employ more people, who make more money, who pay more tax etc. etc.

Pericles>> But the principle, that the more taxation a company has to pay relative to its profits, the less is available to expand the business, employ more people, and to pay those people more wages, remains completely sound and unarguable<<

If that is ipso facto Pericles, then why are non corporate businesses taxed at three times the rate of the corporations........does our government not want them to invest further in their business and create more jobs and pay the plebs plenty?

Not much of an argument, the economies of scale that you proffer. Perhaps when the corporations get big enough the workers can pay them for the right to work........that is the extension of your argument.

'"taxable revenue" does not exist, while "taxable profits" do.'

Interesting point. Most wage earners are taxed on revenue rather than profit.

Transport costs to get to and from work and costs of child care are two items that for many are incurred in order to earn their income with no exemption.

I've known enough others who able to take advantage of a whole lot of loopholes in tax available to the self employed and businesses to be somewhat cynical about a lot of the claims of those supporting the current slug the wage earner approach.

R0bert

Definition, sonofgloin?

>>...why are non corporate businesses taxed at three times the rate of the corporations<<

What is a "non corporate business" in your terminology? And what exactly are the tax rates that you apply to "corporations" and "non corporate business"?

You are becoming increasingly confusing in your defence of the indefensible. What do you mean by this comment, for example?

>>Not much of an argument, the economies of scale that you proffer.<<

Where did I argue economies of scale? In my book, all businesses, large or small, operate along the same lines, and are taxed identically.

A fine point, R0bert.

>>Most wage earners are taxed on revenue rather than profit.<<

On the one hand, every so often a government will try to bring the two rates into synch, in order to avoid precisely the temptation to reduce tax through the intermediation of a company structure. They usually drift apart again when they realize that it impacts employment. As it would.

On the other, giving individuals the ability to offset expenses that are "work-related" opens up another massive can of worms. Except for the Tax Department employees, of course, who would quickly become 70% of the workforce.

Pericles>> In my book, all businesses, large or small, operate along the same lines, and are taxed identically.<<

Sorry to inform you Pericles, but your book is fiction. This is the opening to the supplied link from the ABC SEPT 2014:

"A third of Australia's largest companies are paying a fraction of the full 30 per cent corporate tax rate."

http://www.abc.net.au/news/2014-09-29/a-third-of-top-australian-companies-pay-less-than-10pc-tax/5775870

Pericles,supply some facts to back the position you take.

No need, sonofgloin.

>>Pericles,supply some facts to back the position you take.<<

You have supplied all the relevant information yourself:

>>"A third of Australia's largest companies are paying a fraction of the full 30 per cent corporate tax rate."<<

The corporate tax rate is the same for every business, large or small.

Allowable deductions are the same for every business, large or small.

If your point is that our tax laws need adjusting, in order to correct perceived imbalances in the average tax take from different corporations, then say so.

Feel free to then follow up with a proposal as to what adjustments you feel to be necessary. That will help us examine the impact of those changes on both the corporations themselves and the government's budget.

But to do that, you first have to understand the complete lack of logic in your opening post.

Pericles>>But to do that, you first have to understand the complete lack of logic in your opening post.<<

Thanks or your input P,........we aint going nowhere here.

It's a pleasure, sonofgloin.

>>Thanks or your input P<<

I only hope you found it interesting.

Sonofgloin of course you aren't going anywhere with Pericles, she is simply an attack dog & against anything not the current left position.

Answers or improvements in the system are not of interest to her.

That's quite amusing, Hasbeen.

>>...of course you aren't going anywhere with Pericles, she is simply an attack dog & against anything not the current left position.<<

Which part of my explanation to sonofgloin represents a "current left position"?

I would have thought that sonofgloin's opening stance, redolent of anti-capitalist fury at the evil corporations and their oppression of the working man, was far closer to a "current left position" than anything I contributed.

But what do I know, eh.

So sonofgloin, where do you think the largest tax payers, as a group, get ther incomes from, corporations.

In fact, without corporations we would revert back to growing and making things to use as both food and/or to trade with because even the likes of our modern day communications avenues are provided by corporations. So while you may well ask how much tax they pay, you should also consider how much tax they generate, because without them it would be survival of the fittest, every man for himself, so be careful what you wish for sonofgloin.

The other issue many either don't get, or choose to ignore, is the huge difference in how corporate and personal income taxes are paid.

Where a PAYG income earner pays their tax, then claims back deductions, corporations claim deductions first, then pay tax. Corporations also pay taxes such as payroll tax, capital gains tax, FBT and of cause the dressed tax in advance, based on a prediction of the future years earnings.

Then of cause there is the issue of millions of dollars paid by corporations acting as tax collectors, all of which is performed as a 'gift' to the tax department meaning that corporations pay for this collection but don't get reimbursed.

So it's important we look at the whole picture, not just the juicy bits the media feeds us.

Rehctub, >> Where a PAYG income earner pays their tax, then claims back deductions, corporations claim deductions first, then pay tax. Corporations also pay taxes such as payroll tax, capital gains tax, FBT and of cause the dressed tax in advance, based on a prediction of the future years earnings.<<
This is from the ATO:
“Income received by individuals is taxed at progressive rates, while income derived by companies are taxed at a flat rate of 30%”

I don’t give a tinkers cuss for your position that corporations should be free of tax because they employ multitudes. As I said to Pericles if bringing employment is the qualification for getting the tax breaks that legally allow you to pay 8% tax instead of 30%, why do small and medium sized employers pay 30%......they also employ people.

In exactly the same fashion as a “family trust” excludes those with the money from paying the same tax as their neighbour, small and medium business do not have the capital or reach to avail themselves of the lucrative tax breaks written in to minimise the tax corporations pay.

Butcher>> Then of cause there is the issue of millions of dollars paid by corporations acting as tax collectors, all of which is performed as a 'gift' to the tax department meaning that corporations pay for this collection but don't get reimbursed.<<

Stop being an apologist for the corporations.....all small and medium businesses have also carried the burden of being a tax collector and collator. I worked with Pac Dunlop thirty years ago and HO in Melbourne had dozens employees looking after their tax liability and they paid 23% tax on their net profit after all claims and liabilities.

Sorry sonofgloin, but I disagree.

Small corporations pay far less in taxes than you may think as many of them have undeclared income, and as corporations are mostly public companies, they don't have this.

Small corporations often trade goods and services as well, another form of undeclared income.

The top 20% of income earners, most of which are corporations paid 74% or so of our income taxes, so of cause we should be encouraging them to stay, because wit out them we will fold. I say this because large corporations usually project manage then engage small corporations to do the work and employ most of the masses.

Large corporations are simply working within the perimeters of our tax laws and, if the laws are wrong, then change them, but, and I stress the 'but', be very careful what you wish for because the reality is we need them far more than they need us.

You also forget that we are one of the most expensive countries in which to do business with the scheduled withdrawal of Hoden, Ford and Toyota, once the subsidies were withdrawn being evidence enough to suggest others will follow should we impose further restrictions on them.

At the end of the day, with 74% of our income tax revenues being paid mostly by large corporations, that's on ship we should think carefully about before we decide to rock it, as not only do they pay these taxes, they also provide the majority of the taxes generated, albeit indirectly, because without them there would be no real jobs to speak of.

The answer in my view is tax reform, not tax crack down.

Butch, I take all you say into account.

Given your qualification that corporations should pay one third the tax rate of the non corporate business, the flow ons you describe are true for any enterprise short of a sole trader...they all generate jobs and flow ons.

The opening thread had one premise; if corporations paid the same percentage of tax they paid in 1980 the government will have a healthy revenue stream. Consider these facts:

Australia signed the Lima Agreement in 1973, over a period of 30 years this agreement dismantled our manufacturing base. In 1973 combined Australian household savings was 16% of our GDP. In 1974 they introduced easy credit to Australia via Bankcard.....and sent them to everybody, even the dead. In the 30 years since we have seen personal debt boom to the point where household savings now struggle to hit 2% of GDP. In those same 30 years the average global tax rate for corporations fell from 27% to 8%. Butch if you believe the corporations are our benefactors..........there is nothing I can say.

Re the legality of the tax minimisation strategies....legal yes, but morally bankrupt regarding the contribution these mega money corporations give back to the society that supports them.

But that's where your theory and reality diverge, sonofgloin.

>>The opening thread had one premise; if corporations paid the same percentage of tax they paid in 1980 the government will have a healthy revenue stream. <<

Your opening post on this thread gave us a figure of 27.3% "Corporate Taxes as a Percentage of Federal Revenue" in 1955, comparing it with 8.9% in 2010.

Think for one moment how many assumptions you are making in suggesting that this one single comparison can produce a "healthy revenue stream".

The biggest assumption of all being that the taxable basis - that's profits, remember - would be the same today, if the businesses had operated under your tax regime. Your proposal to tax corporations three times as much would have a massive impact on their ability to invest in growth, and therefore by definition, in people.

What staggers me most is that you still seem unable to grasp this fundamental, elementary point.

The second aspect I find amazing is that you appear unable to accept that corporate taxation is levied identically across small, medium and large businesses.

And this I also find confusing.

>>Re the legality of the tax minimisation strategies....legal yes, but morally bankrupt regarding the contribution these mega money corporations give back to the society that supports them.<<

What is "morally bankrupt" about using retained profits to employ more people in a productive enterprise, rather than give it to a morally bankrupt government, who fritter it away on pollies pay and perks?

Pericles, you ignored or missed the link I provided.......so here it is again.

http://www.abc.net.au/news/2014-09-29/a-third-of-top-australian-companies-pay-less-than-10pc-tax/5775870

And you clearly missed my response, sonofgloin.

>>The corporate tax rate is the same for every business, large or small. Allowable deductions are the same for every business, large or small<<

Which part of this still remains a mystery to you?

Pericles>> Which part of this still remains a mystery to you?

‘It’s a mystery to me, the game commences, for the usual fee plus expenses”
P, a line from an old Dire Straits song.....the only thing I really know about is the hydrologic cycle, everything else is a mystery to me, plus expenses. I am on a lifelong learning curve.

Pericles>>The second aspect I find amazing is that you appear unable to accept that corporate taxation is levied identically across small, medium and large businesses.<<

Some of the tax waivers or credits that the corporations legally use are not pertinent to the PTY LTD trader because of scale....I discussed scale with you earlier; they are not large enough or structurally diverse enough to take advantage of them.

You could say that the tax breaks beyond what the PTY LTD companies are able to utilize were written into law just for the corporations, allowing them to pay only a third of what the local Mathew and Sons PTY LTD pay as a percentage of their earnings.

While I am at it.
It grieves me to know that the cost of gas is rising because of the deal the corporations have made with our bastard good for nothing pollys and bureaucrats. We are the only gas exporter that has allowed the corporations to charge us the European market rate, every other supplier country has done a deal for their people.......except stupid Australia.

As I have said before, global miners get more return on investment in Australia than any other country they deal with. Some despot in Africa hammered out a better deal than our talentless self serving political swill

Examples, sonofgloin?

>>Some of the tax waivers or credits that the corporations legally use are not pertinent to the PTY LTD trader because of scale<<

(But you knew I was going to ask that, didn't you.)

>>You could say that the tax breaks beyond what the PTY LTD companies are able to utilize were written into law just for the corporations, allowing them to pay only a third of what the local Mathew and Sons PTY LTD pay as a percentage of their earnings.<<

You could say that, of course. But it is always better to have evidence that supports you when you do so.

>>Some despot in Africa hammered out a better deal than our talentless self serving political swill<<

And who might that be?

Really, sonofgloin, if we are to have a sensible discussion on tax, as opposed to a bar-room rant, it does help to deal in facts as well as emotions.

Pericles>> Really, sonofgloin, if we are to have a sensible discussion on tax, as opposed to a bar-room rant, it does help to deal in facts as well as emotions.<<

Bar room rant P...showing some colours there..a bit of play the man rather than the ball in that slight.....I took the swill slant straight from Hansard.

So your contribution is to be concentric circles of dialogue without anything excepting the premise of the defence of an ideological stance and the drone of "please explain" over and over again.

As I mentioned previously, I have no desire to discuss this particular issue with you any further.....and as I also said previously, thanks for your input P.

It's not difficult to see why, sonofgloin.

>>As I mentioned previously, I have no desire to discuss this particular issue with you any further<<

It is difficult for some people to accept they have grabbed the wrong end of the stick.

P,I am not being dismissive, I have nowhere to go with you on this one.........thanks.