A senior member of the federal government has talked up the possibility of company tax cuts being included in the upcoming budget as Prime Minister Malcolm Turnbull’s approval rating falls into negative territory for the first time.
Turnbull’s approval rating has plummeted in recent months, according to Newspoll, however, he remains the preferred prime minister in comparison to Opposition Leader Bill Shorten.
Over the weekend, Liberal Senator Arthur Sinodinos talked up the benefits of company tax cuts.
However, Treasuer Scott Morrison has previously flagged any cuts to company tax in this year’s budget will be moderate, given changes to the goods and services tax are now off the table.
Speaking on the ABC’s Insiders program on Sunday, Sinodinos labelled economic reform as “priority number one”, despite the government spending a large amount of time and energy on Senate voting reform last week.
The cabinet secretary said the upcoming budget will be about promoting greater participation in the workforce and hinted at possible cuts to the company tax rate, which currently sits at 30% for most business.
“Putting money in the hands of consumers obviously encourages more spending and disposable income and has good incentive effects,” Sinodinos said.
“But cutting company tax also has good effects. It can encourage investment, it can encourage higher productivity – it can encourage more investment from overseas. There are lots of studies that show that ultimately leads to higher GDP in the economy and higher wages for workers.”
During the interview, Sinodinos also confirmed the “debt levy” imposed on high-income earners during the 2014 budget will come to an end in 2017.
The Australian Taxation Office has for the first time released the names of large private companies that paid no corporate tax during a financial year, as part of a strategy to increase transparency and trust in the tax system.
The report, which examines Australian private companies with total income of $200 million or more, shows 30% did not pay any corporate tax in 2014.
Of those private companies, 12% were exempt from handing over cash to the ATO because they incurred an accounting loss for the current year.
Others did not pay tax because they utilised prior year losses or franking credits, while some companies on the list have related entities that did pay tax.
Some of the companies are also entitled to offsets, such as those associated with the Research and Development Tax Incentive.