Pauline doesn't like it! Now Turnbull's tax plan looks doomed
MALCOLM Turnbull's corporate tax cuts look doomed to fail after Pauline Hanson today announced One Nation would block them in the Senate.
The plan remains the Prime Minister's key strategy to boost wage growth, which has been sluggish in Australia since the Global Financial Crisis.
Senator Hanson's announcement today comes after the Prime Minister spent the past four days in the United States with Australia's corporate giants to make the case for the government's enterprise tax plan, which would cut the corporate tax rate from 30 per cent to 25 per cent over the next decade.
Senator Hanson, who controls three votes in the upper house and can prevent the government gaining a majority to pass legislation, revealed in an opinion piece in The Australian today she did not believe the government's case the tax cuts would boost corporate investment in Australia and lead to jobs and wage growth.
"The government persists in the false claim that company income tax rates drive business investment," Senator Hanson wrote.
"This is ridiculous - all it does is undermine my confidence in the government and its advisers."
Senator Hanson she had consulted with corporate leaders such as Orica's Alberto Calderon, who believed tax cuts alone would not be enough to drive further private investment.
"I listened to everyone who gave me their opinion directly or indirectly and it is clear that expert opinion is divided on the benefits of joining the global race to the bottom for company tax rates," she wrote.
"No one knows what companies will do with the additional cash if the legislation becomes law.
"Companies could pay down debt, increase shareholder returns (through increased dividends or share buybacks), lower prices or a combination of any of these.
"The government prays the savings will be used by companies to create well-paying jobs and a better standard of living across our community.
"If its prayers are not answered then a catastrophic tax collection shortfall will follow, which likely will be funded by debt we cannot afford.
"The recent American tax cuts are expected to double US debt in the first year and add more than $US1 trillion ($1.3 trillion) to debt in 10 years."
Senator Hanson urged the government instead to focus on measures to encourage globally competitive electricity and gas prices.
The senator said she would continue to negotiate with the government on the corporate tax cuts.