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Payroll Tax is Anti-Jobs

May 17th, 2009 by Viv

It is refreshing to see that that the WA Government are talking about abolishing payroll tax for a year. If they do, they ought to abolish it for ever.

Payroll Tax really is a tax from Marxland. If ever a tax should be immediately abolished without any equivocation whatsoever, it is payroll tax. It is inconceivable that people or companies employing workers should be taxed as though employing people was a crime, a heavy penalty for creating real jobs providing goods and or services for which people scramble.

The payroll tax is a huge impediment to employment, it prohibits some people from even starting businesses. And as far as exporters go, it is a huge additional cost and so helps to render Australian goods uncompetitive. The late Professor Colin Clark has pointed out that the long-run effect of payroll tax is to lower the remuneration received by labour.

With the advent of the GST, it should have been the first tax to go. To his credit Sir Joh Bjelke Petersen not only abolished death duties, he planned to also abolish payroll tax. However, he was threatened with retaliatory action against Queensland by the then federal government if he did so.

The tax on employment is both criminal and stupid.

Ronald Kitching

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