Archive for 'Tax'
Company tax avoidance is not a failing of capitalism: it is its logical expression.
There are two ways to really tax the rich. The first is for workers to win bigger pay increases to stop the bosses getting their hands on more of our money before they can play funny buggers with it. The second is to overthrow the capitalist system which produces corporate tax avoidance.
Tax is ultimately an extraction from surplus value. Surplus value comes out of the unpaid labour of workers. It is the difference between the value of the worker’s labour power and the value created by the labour done. Through the process of circulation and exchange in the marketplace this surplus value finds expression in various forms and is distributed to the members of the band of hostile brothers. Thus the tax system taxes capital on its profits, landlords on their rent, shareholders on their dividends, and financiers on their interest-profits. It taxes workers on their wages. All of these appearances – profit, interest, rent, dividends, and wages – are the monetised price forms of surplus value created by productive workers in the production of commodities, goods and services for sale on the market. The income tax system hides this essence and reinforces the appearance of capitalism at the expense of this deeper reality of the exploitation of labour.
This may be the logic. Trickle down will increase revenue. The less tax we collect today from companies will magically produce more economic activity in the future. So having people in charge of the Australian Tax Office who ‘understand’ business and the realities they face is just what capital needs. To business, tax is just another cost and the lower the costs the higher the profit and the better off all of us will be
I believe in Santa Claus too.
Priorities eh? Scrap the school kids bonus and increase the superannuation tax on those people earning less than $37000 while at the same time saving multi-millionaire superannuants about $20,000 in tax a year and multinational companies $600 million a year. Class war anyone?
There is an alternative to finding new ways to tax workers and the poor. There is an alternative to the Goods and Services Tax. Tax the rich.
As a tax man I have been thinking about Kevin Rudd’s idea to cut company tax in the Northern Territory to 20%.
Let me tell you a story about profit shifting, or transfer pricing as it is known in tax circles.
Tax is also an ideological tool of capital. The propaganda of equity, undermined in fact by the reality of tax trends in Australia and around the globe, hides the reality both of tax inequality and the fundamental inequality that is capitalism, built as it is on the extraction of surplus value from workers by capital.
Me just published in the Canberra Law Review (as a fairly basic prelude of sorts to talking about Marx on rent) ‘Taxing economic rent is one key element in tax reform in Australia and sets possible directions for the future. This paper introduces readers to the ideas of Adam Smith and David Ricardo and others on rent to aid understanding of the debates about economic rent today.
Enough of the charades Labor and the Liberals are playing over tax. Abolish the Goods and Services Tax and soak the rich till their pips squeak.
Gillard has not ruled out tax increases either, but her talk about sharing the pain means that the burden of tax increases will be borne by you and me, not the rich. It is all about priorities.
Labor won’t tax the rich. Instead it has attacked the vulnerable, like single parents and those sectors it wants to further privatise, even if under government tutelage, like universities.
Is there an alternative? Labor could tax the rich. It isn’t rocket science. Here are a few examples.