The tax rate on profit made by business is 30%. From July it will be 28.5% for all businesses.
At the same time, companies that earn over $5M in taxable income will have to pay a 1.5% levy that will go towards PPL.
So big businesses will have a zero impact on their profit after tax.
Smaller businesses though get an increase in their profit
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20-06-2014 07:09 #311
20-06-2014 07:35 #312
Ok thanks. So from a very base line interpretation the government won't have more money to fund this. In fact it will have less as companies that benefit from the tax cut won't necessarily pay the ppl levy.
So I can appreciate why people struggle to understand how in a so called budget crisis we can pay for this.
Not saying I don't agree with it though. Can see why it's a struggle.
20-06-2014 07:53 #313
Not to forget that women still pay tax on ppl. It doesn't take a genius to work out tax revenue from the women's rate of pay ( if earning over minimum wage) would be higher if she got 6 months @ her rate of pay compared to our current scheme or 6 months @ minimum wage.
Therefore the general "pool" of tax dollars would be better off if paid at her normal rate.
20-06-2014 08:06 #314
20-06-2014 08:09 #315
I'm also wondering how it impacts on businesses like large law firms or accounting firms that aren't companies. They won't pay the tax or get the tax break.
And yes even paying tax on my PPL I was better off I believe under my contract than I would be under the new scheme.
20-06-2014 09:29 #316
good point @maternidade however this has been taken into account when coming up with the net cost of the scheme.
So the increase of tax income dollars perceived by the commonwealth that this PPL will drive will only cover PPL cost. It won't be available for other things IYKWIM.
@Sonja the budget crisis is bogus and we know it. Just a way for the coalition to try and pass unpopular measures
I was a bit skeptical about the decrease in profit tax for business but now I believe this will support the economy and help small businesses.
20-06-2014 10:38 #317-
- Join Date
- Apr 2012
20-06-2014 10:41 #318
Wow. Resorting to period "jokes". Bit beneath you perhaps?
It's annoying when people are vocally against something without having any actual idea of how the proposal would work. Frankly I expect it of less intelligent people than you VP, so I'm perhaps more surprised.
And your response and "zip it" comment was fairly narky too. Bad night?
20-06-2014 10:43 #319-
- Join Date
- Apr 2012
If all businesses are getting a 1.5% tax cut and the top businesses are being charged 1.5% extra tax then doesn't that cancel each other out? In which case either the government will need to cut spending elsewhere to make up the extra funds for the ppl?
20-06-2014 10:54 #320
The 1.5% levy would cover the net cost of the proposed PPL so no need for other money.
If PPL doesn't go through then the levy won't either.
I hope it clarifies.
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