Former treasury boss Ken Henry has backed the government's 10-year plan to cut the company tax rate, saying it should be done even sooner.
Presently the chairman of the National Australia Bank, Dr Henry conducted the Henry Review of the tax system for prime minister Kevin Rudd and served as treasury secretary under treasurers Peter Costello and Wayne Swan.
!["Half of business leaders say a lack of a clear plan for Australia's economic future is holding them back from making ...](/web/20170225212806im_/http://www.smh.com.au/content/dam/images/g/t/7/q/d/t/image.related.articleLeadwide.620x349.guj8x0.png/1487826444453.jpg)
Delivering a keynote address to the Committee for the Economic Development of Australia in Canberra, Dr Henry said the proposal to cut the rate from 30 per cent to 25 per cent over 10 years is insufficient and it needed to be cut "much more quickly than is presently under consideration by our Parliament".
If that couldn't be done the parliament needed to adopt another measure that cut "substantially the cost to Australian businesses of equity capital sourced from abroad".
Labor opposed the full tax cut in the election, arguing it would eventually cost $8 billion per year which wasn't provided for in budget estimates.
Dr Henry said the old approach of "buying approval" for tax changes by giving everyone a tax cuts was no longer affordable, meaning proposals had to be pushed on their merits. There was also a case for lifting and broadening the base of the 10 per cent GST.
"It is up to business to create the case for change," he said. "We must start with a realistic assessment of where we are – setting out the challenges and opportunities before us – and a clear roadmap to the future being described by our citizens."
"Business investment is soft. Why? Half of business leaders say a lack of a clear plan for Australia's economic future is holding them back from making investment decisions."
"We do nobody any favours – least of all our shareholders – when we boast proudly, on the one hand, that we are the source of jobs and incomes but, on the other, insist that we need accept no responsibility for the impact of our business decisions on communities and the environment.
Dr Henry said topics that were traditionally the preoccupation of politicians would have to become the focus of business.
"Australia's business leaders have to accept responsibility for ensuring that strong population growth, and the investment opportunities that go with it, lift economic and social opportunity for all, without damaging the quality of the environment we pass to future generations." he said.
"That means that we have to take an interest in traffic congestion, housing affordability, urban amenity and environmental amenity, including climate change mitigation and adaptation."
"If we want better access to skilled domestic workers, then we are going to have to offer those workers the prospect of better lives. If we want modern and efficient infrastructure, then we are going to have to take an interest in the design of our cities; we are going to have to take an interest in regional development; and we are going to have to take an interest in the planning of new urban centres."
"If we want less red tape and less regulation, then we are going to have to demonstrate that regulation is not necessary. And if we want greater certainty in the domestic economy, then we are going to have to start delivering it ourselves."
26 comments
New User? Sign up