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IMF Report: Taxing the rich will reduce inequality, preserve growth

13 October 2017 By ACTU

An IMF report released yesterday shows that the Turnbull Government’s tax cuts for big business would increase inequality and concentrate more wealth in the hands of the few, echoing the calls from the Australian Union movement to end the corporate tax cuts and urgently address inequality.

ctr enderThe Report shows top tax rates in OECD countries have fallen, on average, from 62% to 35% between 1981 and 2015, and that tax increases for the rich would not impact economic growth.

Over the same period income has become more and more concentrated among the top 5 per cent of income earners.

The Turnbull Government’s policy of cutting taxes for the rich and big business, while increasing taxes for middle income Australians, will increase inequality.

Quotes attributable to ACTU Secretary Sally McManus:

“The Government’s policies of cutting taxes for the very wealthy and big business are making inequality worse.

“The IMF report shows that this approach has failed, trickle-down economics has failed. The rich have not put limits on their greed and given wage increases and good steady jobs back to everyone else. The people, through our governments, will need to put limits on their greed to bring fairness back.

“Australians need a pay rise. We need corporations and the already rich to actually pay tax.

“We now have record low wage growth, inequality at 70 year highs, and 40% of Australians are in insecure work.

“We need to change the rules so that the very rich pay a fair share of tax, inequality is reduced, and workers get a pay rise and more secure work.”

UPDATE: IMF, World Bank and Australian Government must address inequality

A letter from ACTU President Ged Kearney to Treasurer Scott Morrison calls on the Turnbull Government to support recommendations from the International Trade Union Confederation (ITUC) that the World Bank and IMF shift their focus to address inequality.

The ACTU also calls on the Turnbull Government to apply these recommendations to its own economic policy.

Inequality caused by over 30 years of failed neo-liberal economic policies is a problem for working people in every country.

The ACTU is supporting the ITUC call for the IMF and World Bank to turn the focus of their efforts from promoting failed neo-liberal economics to addressing inequality, but action from these institutions must be matched by the Turnbull Government.

The proposed changes would place a stronger emphasis on addressing low wage growth, unemployment and underemployment and financial and gender inequality.

Quotes attributable to ACTU President Ged Kearney:

“The IMF and World Bank have been major drivers behind decades of failed neo-liberal economics and the Australian government has been in lock-step with them. This has resulted in workers around the world facing rampant inequality with low wages and rising unemployment and underemployment.”

“The recommendations from the ITUC would shift the focus of domestic and international economic policy to creating quality jobs, expanding universal social protection and transitioning to a low-carbon future and reducing inequality.”

“We need to change the rules for working people and move on from the failed economic policies of the last 30 years. The international financial institutions have a role to play in that transition and we call on the Turnbull Government to consider these recommendations.”



Media contact: Peter Green 0400 764 200 or ACTU Media 03 9664 7315

Contact Details
Name: David Smith, ASU National Secretary
Telephone: 03 9342 1400