Posted by John, January 18th, 2010 - under Rudd Government, Rudd Labor, Tax.



Australians think we should tax the rich and big business more and the poor and middle income earners less. And we should spend more on health and education.

These are the unsurprising findings of a Per Capita tax survey of 1000 Australians released yesterday. Per Capita summarises its findings this way:

Australians believe in a progressive tax system and a society that invests in the provision of public goods and services…

Compare the desires of Australians with the actions of the Rudd Labor Government. It has just received two reports into tax; reports it commissioned to justify more tax largesse to capital.

One, by the Australian Financial Centre forum, recommends that government establish ‘an investment manager regime to reduce or eliminate the tax burden on non-resident investors using local managers, brokers or other agents…’ It wants less regulation of the foreign funds.

Once again finance capital has raised its dream of using our money to make Australia a regional – it used to be global – financial centre . New York. London. Sydney. I don’t see it.

In other words, set up a tax haven in Australia for Wall Street. That’s a good strategy. Import the thinking that gave us the global financial crisis into the country.

At the height of the impact of that crisis in Australia Prime Minister Kevin Rudd railed against ‘extreme capitalism and bankers’ greed’. If he adopts this report’s recommendations then he will have, unsurprisingly, joined them.

Labor’s policies are neoliberalism with a keynesian tinge.

This is a government that says one populist thing after another and then implements policies for its rich mates.

The second report is the Henry Tax Review. Henry is the head of Treasury and has been arguing for less taxes on capital. Labor will agree, perhaps adding in a few tax cuts for low income earners. Neoliberalism with a keynesian tinge can do little else.

Yet this lessening of tax on capital will only, in the long term, exacerbate the problems of capitalism. As I wrote in Real tax reform: a love letter to Ken Henry:

…my proposals relate to the tax system as it is, but from a perspective that recognises that within the exploitative relationship there is a need to understand and recognise that labour creates all the wealth of society in the productive sector. For that reason taxation should fall lightly on the labour of workers (if at all) and heavily on capital and the income of capital and their managers.

Of course Labor won’t tax the rich. They rule for them. As I wrote in Why won’t Labor tax the rich?:

Labor won’t tax the rich because it believes in the primacy of profit and the lie of the trickle down theory – what’s good for the rich is good for the rest of us.

Listen to voters, Labor, and not your big business mates. Tax the rich, tax big business, tax the polluters. Spend the extra money on health and education.