The federal government has denied Microsoft Australia's claims that there are numerous problems with its information technology and tax policy, in particular a lack of infrastructure for the new economy.
A paper released by the multinational software giant, Accelerating Innovation, claims Australia suffers from a shortage of bandwidth requirements and the government's attempts to encourage adequate infrastructure had fallen short.
The government immediately countered the argument, claiming a recent bandwidth enquiry found Australia has inadequate backbone capability.
Affordable bandwith
The paper submitted by Microsoft and aimed at shaping the Prime Minister's upcoming Innovation Statement, calls for the government to "apply greater competitive pressures to encourage better access to affordable bandwidth."
"The government is aware of the importance of access to affordable services through competitive pressure," a spokesperson for the Minister for Communications, Information and Technology and the Arts, Senator Richard Alston told ZDNet.
Disguising taxes
Microsoft also accused the government of "disguising taxation" from the sale of bandwidth and was unfavourable towards tax incentives to attract new business to Australia.
"The government has already initiated significant changes to the Australian taxation system to encourage innovation and investment through reduction of company's tax rates and the capital gains tax," the spokesman said.
"The government is consulting with a number of stakeholders in developing the 'innovation action plan' to be released by the Prime Minister in the coming weeks."
