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Daily Telegraph
15 minutes ago
- Daily Telegraph
Anthony Albanese has requested a phone call with Israeli PM Benjamin Netanyahu, as Aus ponders Palestinian statehood
Don't miss out on the headlines from Breaking News. Followed categories will be added to My News. Anthony Albanese is seeking a call with Israeli Prime Minister Benjamin Netanyahu as the government weighs up whether it will join international allies to recognise Palestinian statehood at the United Nations General Assembly. The Prime Minister is yet to confirm the move, despite the UK, France, and Canada all indicating they will make such a call. Mr Albanese has sought a phone call with Israeli Prime Minister Benjamin Netanyahu – something praised by Senior Coalition frontbencher Dan Tehan, who says current Australian-Israel relations have 'clearly been lacking' since the October 7 attacks in relation to communications at a 'prime ministerial level and a senior ministerial level'. 'Any dialogue which will enable both governments to put their case, and my hope is that the Prime Minister will be open to listening to Benjamin Netanyahu, so that he can get an Israeli view of what is happening on the ground and what they're trying to do to bring peace to Gaza,' he told Sky. Anthony Albanese has requested a call with Israeli Prime Minister Benjamin Netanyahu. Picture: X Earlier, Sussan Ley told the ABC that the Coalition would only support the formal recognition of Palestinian statehood once 'peace' had been achieved, meaning Hamas would need to surrender and release the hostages. 'Everyone wants to see this war end … Everyone wants to say the bloodshed stop. Everyone wants to see critical food aid get to Gazans who desperately need it, and I'm pleased to see that that's happening,' she said. 'But this is critical – the war could end tomorrow if Hamas surrenders and releases the hostages.' The Prime Minister's potential call with Mr Netanyahu comes as Mr Albanese faces growing international pressure to recognising Palestinian statehood, with the UK and Canada joining France this week. This follows global condemnation of Israel for the starvation and the withholding of aid from Gazan civilians, something Mr Netanyahu has rejected and labelled a 'bold-faced lie'. UK Prime Minister Keir Starmer, who Mr Albanese has been in contact with since the announcement, said the UK would support the motion unless Israel 'takes substantive steps to ed the appalling situation in Gaza and agrees to a ceasefire'. Canadian Prime Minister while Canadian Prime Minister Mark Carney said his position was incumbent on While Australia supports a two-state solution, acknowledging Palestine's statehood could not be 'just a gesture,' but done to forward the peaceful existence of Israel and Palestine. Mr Albanese has said the formal recognition of statehood cannot be 'just a gesture'. Picture: NewsWire / Martin Ollman Speaking to the ABC on Thursday, he said Australia would only be able to make that statement 'once,' adding that 'once you make that declaration, you lose your capacity to negotiate and to influence outcomes to some extent'. 'We won't be driven by a time frame. What we'll be driven by is when the recognition of Palestine can make a contribution to the creation of two states,' he said. 'We think that arising out of what is a crisis, the world needs to look at the opportunity that there is not just to solve the current crisis, but how do we create security for both the state of Israel and the legitimate aspirations of the Palestinians for their own state to be realised.' Originally published as Anthony Albanese has requested a phone call with Israeli PM Benjamin Netanyahu, as Aus ponders Palestinian statehood
ABC News
43 minutes ago
- ABC News
Bird's eye view of pro-Palestinian march across Sydney Harbour Bridge
Thousands of protesters advance across the Sydney Harbour Bridge to demand an end to the Gaza war.
ABC News
2 hours ago
- ABC News
Hike taxes on the oligopolies extracting 'rent' from Australia's economy
Australia's economy is dominated by powerful firms that are extracting above-normal profits from the system, and their power is growing. They're extracting "economic rent" from our economy, which means they're charging higher prices and collecting higher profits from a lack of competition. The Productivity Commission (PC) says if we want to reform our tax system we need to focus on that issue, because it will solve a whole host of problems. Which industries are extracting economic rent from our society? It won't surprise you: the gas, oil, coal, and iron ore industries, the banking and financial services industry, the wholesale and retail industries, and telecommunication networks, among others. Last week, the PC published its interim recommendations to the Albanese government for how to reform Australia's corporate tax system. But at the heart of its recommendations was something fascinating. It showed the PC has picked up the cause of economists like Ross Garnaut and others who have been calling for our tax system to be reconfigured to tax economic rents much more heavily. Professor Garnaut spoke about these ideas in his Bannerman Lecture in May 2023 and his Henry George Commemorative Dinner address in September 2023. And the PC has explicitly drawn from two of Garnaut's recent journal articles to inform its recommendations. The first article is The Economic Public Interest in a World of Oligopoly (2023). Here's the summary of its argument: "The Australian economy has performed well compared with comparable countries over the last three decades only if we average the excellent performance in the 1990s and the poor performance over the past decade," Garnaut wrote. "Real wages over the past decade have stagnated — to an extent without historical parallel. "We cannot understand the economy's underperformance without recognising the increasing claims of economic rents on national income. "Correction of weaknesses requires coordination of many policy instruments including measures to reduce the prevalence of rents (competition policy and regulation of oligopoly where competition is not feasible or inefficient) and changes in taxation arrangements to shift the burden of business taxation from firms in competitive activities to firms relying heavily on economic rents." The second article is Replacing Corporate Income Tax with a Cash Flow Tax (2020), which Garnaut co-authored with Craig Emerson, Reuben Finighan, and Stephen Anthony. In that article, Garnaut and his colleagues said Australia's corporate tax system was built for the wrong century and we needed a new system to account for 21st-century realities. What were those new realities? They said greater mobility of capital had given rise to an international "race to the bottom" in company tax rates to attract and retain investment, while multinationals have far more opportunities to avoid and evade taxes through transactions across international borders. They warned that the phenomenon had contributed to the public's growing resentment of "globalisation" and a distrust of market exchange. They said the competitive position of national companies had declined compared to multinational corporations, due to their more limited opportunities for tax avoidance and evasion. They said the proportion of Australia's corporate income deriving from "economic rent" had grown, while the competitive returns on capital had declined. And our national tax compliance culture had deteriorated. "This paper suggests a major change in approach to taxing corporate income," they wrote. "It proposes changing the corporate tax base, from a conventional view of income to cash flow. "This increases the incidence of the tax on economic rent, and reduces the incidence on competitive or 'normal' returns on investment. "Our proposed cash flow tax is relatively simple to administer, applying familiar and well‐tested measurements of the taxation base." They also warned that a large and growing presence of economic rent in an economy tends to increase income and wealth inequality, owing to the narrow ownership of the scarce assets that attract rent. The PC agrees that our company tax system is inefficient. It asked the economist Chris Murphy to investigate the prevalence of economic rents in Australia's economy, and how a net cashflow tax could work, and it has relied on Murphy's modelling to make its recommendations to the government. Mr Murphy says his modelling accounts for three main types of rents: oligopoly rents, mineral rents, and land rents. Collectively, he says economic rents account for 54 per cent of corporate tax revenue in Australia, which is up from 41 per cent in 2016-17. The PC is very aware of what that indicates. It says business investment has fallen significantly in Australia over the past decade, and the lack of investment has contributed to Australia's "lacklustre productivity performance." Meanwhile, economic rents have become a more important part of Australia's company tax revenue by default. Therefore, it says we need to consciously shift to a new tax system that specifically targets economic rents, better encourages investment, and reinvigorates competition in moribund areas of the economy that are dominated by a few large firms. Murphy says his model of Australia's economy has 278 industries. He says 29 of those industries have oligopoly rents, but in practice, 85 per cent of oligopoly rents are received by just five industries: bank interest margins, wholesale margins, retail margins, bank fees, and telecommunications networks. He says mineral resource rents are present in five industries: coal mining, crude oil, liquefied natural gas (LNG), other gas extraction, and iron ore mining. He doesn't provide many details about land rents. In his modelling, Murphy discusses how taxing normal returns to capital has a "double disincentive" effect of discouraging both investment and labour supply, but location-specific economic rents are immobile, so taxing them does not diminish their local supply at all. He says his estimate that economic rents account for 54 per cent of corporate tax revenue in Australia highlights the challenges in designing corporate tax policy. "About one-half of revenue is collected from normal returns to capital, doing considerable economic harm through the double disincentive effect," he writes. "The other half is collected from economic rents, which in principle does no economic harm." So, the PC has made the following proposal to the Albanese government, ahead of this month's reform roundtable. It says Australia needs a new corporate tax system. It says we should cut our headline company income tax rate to 20 per cent (from 30 per cent or 25 per cent) for companies with revenue below $1 billion (which is the vast majority of Australian companies), but we should keep the 30 per cent tax rate for Australia's largest companies, with turnover above $1 billion, in the short-term. It says we should also introduce a new "net cashflow tax" of 5 per cent to be applied to company profits. It says the new tax will reward companies for capital expenditure by reducing their taxable income by the value of their investments. It says such a system would encourage business investment much more than our current system, and thereby help to produce a more dynamic and resilient economy in the long run. It says the net cashflow tax will likely increase the tax burden for companies with turnover above $1 billion. Murphy's modelling suggests the reforms will increase investment by $7.4 billion (1.6 per cent), GDP by $14.6 billion (0.5 per cent) and labour productivity by 0.4 per cent over the medium term. It says the initial reforms will be revenue-neutral, so they won't weaken the government's budget position. The PC says that if we tax economic rents more heavily, we can cut taxes on millions of smaller companies in Australia that are operating in more competitive environments, which will allow them to grow and challenge the big incumbents. "In many sectors, a small number of big firms exercise market power to the detriment of consumers, while ever more complicated regulatory and tax systems impose higher costs that keep new entrants from joining in or scaling up," it says. "With fewer firms entering and exiting, the economy is not getting a productivity bounce from new firms challenging incumbents. "Few grow into medium and large-sized businesses. Lower rates of business investment mean less capital per person and lower productivity growth. "The corporate tax system is not delivering the best outcomes."
