If we did this we would then have a headline corporate tax rate of 0% and Aussie investors would still pay about the same in tax. And we would not only boost the capital available to business via foreign investment we would also boost it via retained earnings.

Of course if you wanted to soak the foreigners a little you could apply a 19% tax on dividends paid to foreign companies/individuals.

Do you mean would it concern me if I got half of what I want – half dividend imputation and half company tax cut – say down to 25%.

Well better than nothing, but DI is quite complex so I think there are some additional benefits from getting rid of it. I’d also like to see us chase the rate further down – say to Irish levels and to do so introduce anti-avoidance like undistributed profits taxation and also to raise more revenue from resource rents – as it seems Ken Henry wants to do.

There is the possibility it could take a haircut on the way through, would that concern you?

It’s here (pdf).

Does this come from some formal refutation of Miller-Modigliani that you’ve done, or is this just something off the top of your head?