Federal cabinet is under pressure from business, accountants and
Liberal backbenchers to drop a Treasury plan to make it harder for
companies to claim donations on up to $94 billion in accumulated tax
losses, reports today’s Financial Review.
Revenue Minister Mal
Brough has agreed to work with a delegation of business, tax and mining
groups to present a compromise to cabinet on controversial changes to
laws limiting the tax
breaks large companies can claim on losses incurred before a change of
ownership.

Meanwhile, John Howard has foreshadowed possible tax cuts
next year if there’s money left over from funding essential services.
And the Howard government’s Work Choices reforms may appear
significant, says Graeme Watson in The Fin,
but internationally, they are “almost a non-event,” ending as they do
a
system of compulsory arbitration that’s an international curiosity. And
when the “economic advantages of a less regulated IR system are
understood,” says Watson, the ALP will have to readjust its IR policy
to match its economic credibility.

There’s a “dogfight” over the next fleet of Qantas planes, reports The
Australian, as the airline’s decision on whether to choose Boeing or
Airbus for its $15-20 billion fleet upgrade is going “down to wire,” as
the international arch-rivals fight it out to offer the best deal. Qantas chief executive Geoff Dixon told ABC’s Insiders that the competition between Boeing and Airbus was
the “closest contractual race that I have ever seen in my time in the
industry.”

And the paper reports
that following Robert Gerard’s resignation, the spotlight is on the
remaining nine members of the RBA and the bank’s workings – though
economists expect that Tuesday’s meeting will be a non-event, with
rates likely to remain unchanged.

At the SMH,
John Garnaut writes that Robert Gerard’s “hefty presence” won’t be
missed on the Reserve
Bank board, “where he appeared more interested in Melbourne horse
races than setting interest rates.” But the enduring cost, which may
outlast the Treasurer’s time in
Canberra, will be borne by the revenue system, he says. Meanwhile,
seven years after Pfitzer introduced its commercial blockbuster,
Viagra, the market for impotence medicine appears to have fallen well short of what was once predicted.

An estimated $5 billion is moved out of Australia each year to tax
havens around the world, according to Deputy Commissioner of Taxation
Paul Duffus, reports The Smage. Mr Duffus recently told the Senate Economics Legislative Committee
that the Australian Tax Office has been negotiating
information-exchange programs with 10 tax havens, including Antigua
and Barbuda, Jersey, Guernsey, Bermuda, Isle of Man, British Virgin
Islands, Cayman Islands, Anguilla, Netherlands Antilles and
Grenada, culminating in the signing of its first tax
information exchange agreement with Bermuda last month.