whiteknight
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Greens release corporate tax plan to generate $338 billion over the next decade
ABC News
Posted Mon 6 Sep 2021
Large companies and mining corporations could be paying more tax under a plan by the Greens that is reminiscent of a former Labor policy.
Key points:
A company with a turnover of more than $100 million would face a 40 per cent super-profits tax
The Greens want to see the tax spent on Medicare, JobSeeker and housing
Experts say Australia's corporate tax rate is already higher then many countries
Leader Adam Bandt said the measures would bring in $338 billion over the next decade, which would help fund dental appointments and mental health support, as well as lift the JobSeeker rate.
Elements of the policy mirror Labor's controversial mining tax that passed in 2012 but was later repealed by then-prime minister Tony Abbott.
The Greens' Corporate Super-Profits Tax is the party's attempt to stake out some political ground ahead of the looming federal election, which is likely to be held next year.
However, there are a lot of pieces of the political puzzle that need to fall into place for it to become a reality.
Greens say higher tax is needed
Mr Bandt believes many Australians support big business being hit with additional costs.
"While everyone else has suffered through the pandemic, billionaire corporations have made out like bandits and profits are at record highs," he said.
"A 'tycoon tax' is essential because there's huge wealth in this country, but it's being hoarded by a greedy few."
Under the proposal, a company that has a turnover of more than $100 million would be slugged with the 40 per cent corporate super-profits tax.
The new tax would apply to a company's net revenue, after income tax and a "fair return to shareholders" is deducted.
Independent economist Saul Eslake explained how it could work.
"In effect, they're saying that any company which generates profits that represent a return to shareholders in excess of 6 per cent, or thereabouts, after a payment of the normal company tax, should be paying an additional 40 per cent of those so-called excess profits to the government by way of tax," he said.
Mr Eslake argued that Australia's corporate tax rate was already higher than many other countries.
"Among the 38 or so member countries of the OECD, only Portugal and Colombia, neither of which are particularly developed, have higher statutory corporate tax rates than Australia does," he said.
"Indeed, Australia gets a larger proportion of its total tax revenue from company tax than most other so-called Western economies.
"So the case for Australia to do more in that context is, I think, not very compelling."
The tax bill issued to mining companies would be assessed on a project-by-project basis, which is what was recommended in the Ken Henry review commissioned by the former Labor government.
It led to the introduction of the mining tax in 2012 after years of negotiating and lobbying.
That tax was repealed two years later by the Coalition government.
However Mr Bandt is confident there is still support within opposition ranks to bring back such a tax.
"I think the case for a super-profits tax on these billionaire corporations, in a style originally proposed by Kevin Rudd, is only going to grow," he said.
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