Reduction of Corporate Tax will not help the economy

Budget day is approaching and as usual, some are asking for the corporate tax to be reduced, in light of the problems in the eurozone. However, by looking the situation in the United States, anyone will know that this will not help the economy at all. In fact, all those savings only resulted in an increase of savings in the bank. It did not result in more hiring or more spending.

The only way to help the economy is to encourage the same level or slightly higher level of spending. Reduction of corporate tax will not help. Continue rebates in our utility bills, GST and income tax may help for a while but this is only waiting for someone else (namely the US and Europe) to recover and give us a leg up.

Is there something more innovative to help us stand on our own 2 feet instead of waiting for others to push us along? Nothing comes to mind yet. At least the government is in the best position to help push the economy at least for a while until they figure this out. I only hope that whatever they do, they should not push up the inflation again to 2011 levels.