"The electorate needs to appreciate the significant risk the country adopts by challenging this trend," he said. "Our attractiveness as a location for investment is diminished. Unfortunately the pain is a boiling frog, as we can never know the investment and growth opportunities we will forsake." Business Council of Australia chief executive Jennifer Westacott laid blame on the Labor Opposition, saying it could be years before the issue was revisited. "By then we will be even further behind," she said. "Under the system the Senate has created, if a small company’s turnover increases by just one dollar to reach the $50 million turnover cliff, it will be immediately liable for an additional $125,000 in company tax, if its profit is 10 per cent of its turnover." BCA chief Jennifer Westacott fears it could take years before corporate tax cuts are revisted. Credit:Alex Ellinghausen The United States slashed its federal company tax rate earlier this year from 35 per cent to 21 per cent and the United Kingdom had legislated to reduce its rate from 19 per cent to 17 per cent.

Australia’s company tax rate had been frozen for the past 17 years. “We are kidding ourselves if we think we can impose one of the highest tax rates in the developed world on Australian businesses and expect them to continue to thrive, invest and create jobs," she said. Coca-Cola Amatil managing director Alison Watkins said "it’s a missed opportunity to improve our international competitiveness". CEOs had spoken up and explained the rationale. Large employers were the engines of the Australian economy, accounting for most of the nation's job creation. “Partitioning off and demonising big business is very unfortunate and very misleading," she said. More generally, Liberal party leadership struggles were damaging. Coca Cola Australia CEO Alison Watkins said CEOs had campaigned on the importance of corporate tax cuts. Credit:Josh Robenstone

Australian Industry Group chief executive Innes Willox said that while it wasn't a surprise, the Senate's rejection and withdrawal of support by the government was "a major setback for Australian competitiveness and, ultimately, also a setback for future living standards". Australian Chamber of Commerce and Industry chief James Pearson was disappointed the government has decided not to take the tax cuts for big businesses to the next election, but "if we're looking for blame here let's not forget that the Labor party until only recently supported company tax cuts but have turned their back on it". He said there would be a two-tiered tax system but it was now important that tax cuts for SMEs were fast-tracked. "Let's make the best of a bad job," he said. Ai Group chief Innes Willox says the move was "not a surprise" but would be detrimental to investment Credit:Peter Braig

CPA Australia's head of policy Paul Drum said: "It’s a black day for Australia’s tax competitiveness. It is to the detriment of Australian businesses of all sizes, as well as to higher wages, jobs and our overall standard of living." Minter Ellison's national head of tax Adrian Varrasso said the Senate's rejection and government's change of mind was disappointing. "The reality is that we do stand out with a high headline corporate tax rate," he said. Deloitte tax partner David Watkins said Australia's company tax rate for large businesses will not remain at 30 per cent indefinitely. "Other countries are not standing still on this," he said. KPMG tax partner Grant Wardell-Johnson said the decision meant "we are all losers in the long term". There was no sound economic basis for providing lower rates for smaller companies only. Minter Ellison's national head of tax Adrian Varrasso says the decision is disappointing. Credit:Paul Jeffers