Business Services Industry
Economist links labour shortage to tax.
Australasian Business Intelligence, July, 2006
Byline: Dan Harrison
Jul 26, 2006 (The Age - ABIX via COMTEX) -- The Committee for Economic Development of Australia (CEDA) heard from Dr Nicholas Gruen on 26 July 2006. Amid ongoing debate of tax reform in 2006, Dr Gruen has written "Tax Cuts for Growth - the impact of marginal tax cuts on Australia's labour supply". Dr Gruen believes that "a wage-tax trade-off", under which minimum wages are frozen and low-income workers receive tax relief to maintain the pace of earnings with inflation, is critical to solving Australia's labour shortages. Although tax cuts for high-income earners may reduce skilled workers seeking overseas opportunities, Dr Gruen considers this much less important than targeted strategies for welfare recipients.
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