Fairfax is doing a fair job on the subject of taxation. Today it revealed the extent of Rupert Murdoch’s tax evasion while simultaneously reporting further job cuts to the Australian Taxation Office. The two bits of news are clearly connected in the broad sense, both are about taxes, but there is something else.
The current fascist government of Tony Abbott is perhaps one of the most ideologically driven governments we’ve suffered in recent times. They have attacked almost any person or organisation with an agenda not sympathetic to their own bigoted world view, denying funding to a range of socially useful organisations and publicly denigrating public officials who question the government’s actions. On the other side of the coin, they have offered funding support for mainstream religion in the public education system. But it is on the subject of taxation that their class warfare is truly revealed.
Taxes pay for government services, such as education, health, defence and so on. A general idea is that taxation is also a form of wealth redistribution, that is, rich people pay proportional more tax than poor people and the benefits of government services, while distributed uniformly, tend to improve the living standards of poorer folk, since proportionally, they have less to spend on the sort of things government services help to provide. Such as universal health care or public infrastructure. Less taxes or less government revenue means less is available to spend on theses sorts of things, something that is currently framed in terms of government budget deficits.
The current government has a budget deficit problem. They tried to fix it by slashing expenditure on a range of government services, the sort that benefit the poor and middle class, only to find that a whole lot of people didn’t agree. Now, while busy carving up the one organisation responsible for collecting taxes, they are simultaneously proposing to reduce corporate tax rates and raise the ubiquitous goods and services tax which, as many have observed, tends to place an unfair tax burden on low income earners.
But if the Murdoch exercise in tax minimisation is indicative of what happens when corporations are responsible for their own reporting regimes (something else this government wants to do), then the future for government taxation on large corporations is pretty dim. It was the late great Kerry Packer who once declared it was his personal responsibility to avoid paying any taxes and John Howard rewarded Sir Kerry with a state funeral. It appears this government is keen to surpass Howard by not only moving the tax burden off large corporations and high income earners but also reducing the services governments provide to the less wealthy.
Actually it’s not a matter of appearances, that’s exactly what Tony Abbott is about. His government’s agenda is the most destructive in terms of undermining the social fabric of democratic government we have experienced in recent times. They are the advance guard of the new neocons who seek to destroy the capacity of governments to provide socially useful outcomes. With these people there is no hope.