By Nigel McBride

For a small nation, we are globally competitive on the sporting field. There’s no question that Australia “punches above its weight” in everything from rugby to tennis to Olympic sports. Indeed, for a nation which has a population that approximates the greater Shanghai area, we have also had extraordinary global recognition in fields as broad as the arts and science.

“Australia” is also one of the most enviable tourism brands in the world. In South Australia, our recent rankings in terms of one of the greatest places to visit, one of the most important regions and one of the world’s most liveable cities, is the kind of publicity that you just can’t buy.

But a lot of the impact of those wonderful achievements will be lost, or certainly won’t be fully achieved, unless we compete more effectively in one of the toughest global competitions: the attraction of inbound capital and business investment.

Australia has always been a net importer of capital and we continue to need to attract inbound investment to create jobs and sustainable economic prosperity.

So how do we rate in one of the world’s toughest competitions?

Recently Federal Treasurer Scott Morrison quoted 2017 data analysed by the UK based Oxford Centre for Business Taxation which that found Australia’s corporate tax competitiveness on headline and effective tax rates was the ranked sixth worst out of 33 OECD countries studied, and seventh worst on effective marginal tax rates.

The Treasurer has also expressed his serious concerns about the international competitors in this vital race. The Trump administration plans to bring headline company tax rate down to 15%, the UK is already at 19% and is heading for 17%, and Singapore is already at 17%. The new French President Emmanuel Macron announced in his election campaign that he intended to reduce corporate tax rate from 28% to 25%. And those kinds of movements will continue in many countries which are competing against us for investment.

The stark conclusion to our company tax handicap in this race is that a failure to maintain tax competitiveness will seriously cost Australia jobs as even current investment will be lured off shore, let alone the attraction of new investment.

At 30 per cent, Australia’s corporate tax rate is uncompetitively high in the global competition for investment.

Currently only 5 OECD countries have corporate tax rates higher than Australia, whereas fifteen years ago Australia had the 9th lowest corporate tax rates.

Rather than being painted as “corporate welfare”, the economic burden of failure to reform company tax falls mostly on employees through lower real wages, less job security, lower employment growth and poorer living standards.

Surely this is one competition that Australia must get fiscally fit for.