By Sue Boland
Now that the opinion polls are showing a slim majority against a goods and services tax (GST), big business is getting worried. While capitalists know the Labor Party is no threat to their profits, it isn't offering what the Coalition is — an annual tax break of $10 billion.
The Coalition will achieve this by withdrawing the wholesale sales tax (which business pays) and replacing it with a GST (which consumers pay). Businesses are exempt from paying the GST because the government will refund them for any GST they pay on business inputs.
Although business would like a GST implemented with no exemptions, a GST with some exemptions is better than none at all. Better a tax break of $6-8 billion than no tax break.
The Australian Democrats are offering themselves as the insurance policy for big business and the Howard government getting their GST. That is why the Democrats are getting supportive media attention as the "safe" alternative to the major parties.
To win votes from Liberal Party supporters, the Democrats have announced they are willing to do a deal with a Coalition government over the GST.
The Democrats are showing that, like the Coalition and the Labor Party, they line up with big business against workers and low-income earners.
In addition to the $10 billion that business will gain from a GST, the Democrats want to give another big handout to business by removing payroll tax. Payroll tax is one of the few taxes that business cannot avoid. It should, therefore, be retained.
Any increase in profits resulting from the removal of payroll tax is unlikely to make a dent in unemployment. With world markets cluttered with unsold products, factories are operating below capacity. Rather than increase production and employ more workers, most companies will seek to cut costs by sacking more workers and replacing them with new technology.
The Democrats are misleading when they argue that they will only support a "fair" GST. A GST is intrinsically unfair. It cannot be "made fair".
The Democrats' support for the Workplace Relations Act demonstrated clearly that they care nothing for working people. Their support for a GST — a method by which big business can pick the pockets of the poorest 80% of society — raises the question: should the Democrats change their slogan from "Keep the bastards honest" to "Keep the bastards rich"?