In arguing the case for cutting the company tax rate from 30 per cent to 25 per cent over the course of the next decade, Treasurer Scott Morrison claimed that one of the key effects of such a move would be to boost investment, employment and wages growth.
Let’s use the inverse of that logic when it comes to hiking company taxes.
Specifically, does Mr Morrison think that hiking company tax rates will mean lower investment, employment and wages?
If the banks are stumping up an extra $6.2 billion in tax over the next 4 years, that’s $6.2 billion that will not be available for them to invest, employ or pay out in higher wages.
If, as seems certain, the banks claw it back the $6.2 billion from customers, that’s $6.2 billion less customers will have to spend, invest and employ.
For the story to stack up, Morrison must see the bank tax as negative for investment, employment and wages. Economics is simple when the spin anf hypocrisy is taken out.