Do you wonder why some countries are posting fiscal deficits? Even as the global economy slows, top US corporations are paying more to their CEOs than to the tax department.
Many of them are also spending more in lobbying Congress for refunds and subsidies than they do in actually paying taxes, according to a study featured in Democracy Now!
Some of these companies use tricks like transfer-pricing and off-shore subsidiaries to reduce their tax bills.
Meanwhile, the salary gap between top executives and the average worker in the United States has exploded from 42:1 in 1980 to 325:1 in 2010.
Perhaps a similar study needs to be done here, especially when the government is talking about cutting about removing subsidies. Let’s look at our corporate tax system and find out how much profitable firms are actually paying in corporate taxes.
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It is just reported that Australian airline Qantas has decided to give its chief executive Alan Joyce a 71% pay rise as the company plans to sack 1,000 staff.
That’s the reality in our world today.
According to a BBC World Service report, the last decade was a ‘lost decade’ for USA. High US deficit is partly due to the reduction of income tax during Bush administration, besides high expenditure in fighting 2 wars in Afghanistan and Iraq. I was told less than 10% of Malaysians are income tax payers. That’s the reason why BN government is planning GST so that everyone is taxed when they consume. I pay tax regularly but I do not fly the Jalur Gemilang. Does that mean that I am less patroitic than thoshe who fly the flag but never pay… Read more »
Capitalism is ultimately a self-limiting disease. It will end by finishing us off. The apologists have managed to drown out criticism till now as the burdens were “outsourced” – first to domestic “lower classes”, then to imperial colonies and lastly to “emerging” “democracies”.
Emerging economies of Asia need to be careful with the democracies of free market economy at the same time practice our time tested Asian habit of hard work, thriftiness and saving.
But looking around megamalls, this habit seem reversed and irreversible until the credit crunch of good days is over eventually come visit our shores.
Leaders should look at the macro picture of where our nation is heading and work from the micro, ie our resources including human talents and capital which every nation worth its yesterday competitiveness wants to lure now for the future.
China is doing it ‘carefully’.