94.
Examples of the effects of the personal taxation concessions upon various categories of taxpayers, together with comparative tables, are set out
set out in an Appendix to the printed version of this Speech (46).
Profits tax
95.
As to profits tax, I propose a reduction in the rate of tax on corporate profits from 18% to 17%. The cost of the reduction proposed is $370 million in 1988-89 and, for a full year, $760 million. The new corporate rate of 17% will apply to provisional and final assessments for 1988-89.
96.
Some have argued that a stimulus should be provided to the manufacturing sector through an increase in capital allowances for expenditure incurred the provision of plant and machinery. As I said earlier, in 1987 there was no
reluctance on the part of manufacturers to invest. We are seeing more and more effort being made to increase capacity, improve productivity and enhance profitability. I do not believe that the selective inducement of an increase in capital allowances is what is needed at this time. Instead, I consider that the proposed reduction in the rate of tax on corporate profits will provide appropriate and proper encouragement to all those in business.
(46) Appendix F(3).
/Property
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