A GIANT TAX CON
The Turnbull Government’s proposed tax cuts for the big end of town won’t stimulate employment and economic activity as promised.
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The “Trickle Down Effect” is a myth.
These tax cuts, should they eventuate will simply increase the profits of big business and that’s where they will stay.
They will not be spent on research, development, new machinery or any of the activities that would encourage real growth.
Much of the increased profitability will be directed towards share buy-backs by the firms that issued the shares in the first place. As the number of shares on issue decreases, earnings per share will increase and share prices will benefit for a while. Executive salaries and bonuses which are usually linked to share prices, (a bogus measure of successful management) will also increase.
There will have been no increases in investment, productive output or employment but the rising profits and rising share prices will give the false impression that the economy is going well.
It’s a giant con. Don’t fall for it.
John Martin, Woonona
DON’T GO BACKWARDS
The ACCC inquiry into electricity prices recommended that the Small Scale Renewable Energy Scheme (SRES), which subsidises rooftop solar panels, be abolished.
But the ACCC has ignored some major benefits of the SRES.
The ACCC acknowledges that lack of competition is a main driver of electricity price rises. It recommends encouraging more competition.
But for most people, rooftop solar is the only competitive alternative to getting power generated by a few dominant suppliers, via poles and wires owned and operated by a monopoly.
If the SRES was removed, the price of rooftop solar would rise, so the big suppliers could raise their charges with impunity. The ACCC has not accounted for this.
ACCC report recommends encouraging new supply generation. So it hardly makes sense to remove a scheme which has been doing just that.
Rooftop solar power generated 7200GWh in 2016/2017 – nearly as much as Liddell power station.
If not for this rooftop solar we would have suffered supply shortages and greater price hikes in the last 2 years.
The ACCC report notes the “rooftop solar prices have come down” without acknowledging the effect the SRES has had on kick-starting the rooftop solar industry.
The SRES and solar feed in tariffs are subsidised from electricity bills. This subsidy is about $50 p.a. on average.
The ACCC notes that this is an imposition on poor people. However, there are many people who are not poor and can afford $1 per week.
We should help the fraction of people who need help rather than stopping the whole scheme. The Barrier Reef and our agriculture are being damaged by climate change.
Australia has set itself an inadequate emissions reduction target and is failing to meet even that. This is no time to be stopping a scheme that is moving us forward.
Rowan Huxtable, Mangerton
EDITOR’S NOTE: Reader contributed images of our beautiful region you are used to seeing here now run with the letters to the editor online at illawarramercury.com.au.