After the company tax rate was climbing to above 3 percent in the mid of 2000s, Australia economic growth rate has been declining overall in peripheral. Though there had an average increment about almost 2.1 percent in per capita GDP to 1988, just 1.4 percent from 2002 to 2015. The resources boom had inflamed a powerful growth in the middle of the decade which produced numerous diminutive peaks but in the meanwhile, GDP’s total growth has been on a constantly slowing. Therefore, during the Abbott Prime Minister Ship, the president of the Business Council, Catherine Livingstone had pointed that what needed to do is to change the tax plan. Nevertheless, some economy-study has raises opposed opinions towards government’s tax package. Consequently, the direct tax reform which included cutting business income taxes will not promote financial growth of Australia.
Regarding the support for this claim, the tax reform including cutting business income taxes will neither create job opportunities nor produce the economic growth. According to the historical examination of Australia’s business tax reductions, we can come to a conclusion that there is no relationship
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By contrast, many other taxes are payable whether the company makes a profit or not. If a company don not make profit, they do not need to pay the tax. Meanwhile, since the tax was applied to profits from all business activities, it has not had any effect on decisions. Moreover, the Abbott government not only was not come across with, but also even did not understand why the original policy conversions were requisite. Meanwhile, it is always a complicated tactic to execute when only 3 percent of people think it is better for government to deem the company tax cut as an economic