Tax is much in the news of late. Treasurer Wayne Swan has been telling us the Minerals Resource Rent Tax is working precisely as it should - not raising any tax. The hospital in Yes Minister worked perfectly too - it didn't have any patients.

The failure of the tax, the midyear economic and fiscal outlook, the drop in company tax receipts, the impending departure of the Commissioner of Taxation and the collapse of the business tax working group have all highlighted the importance of tax to Australian capitalism. Thus, for example, the mini-budget was mainly about tax. Revenue from companies is running at about $2.5 billion less than forecast in the budget and the mining tax only a few days ago was going to be about $1.5 billion light on its previous nearly $4 billion estimate this year. But wait. There's more. The revised estimate of $2 billion from the mining tax was before we discovered that for the first quarter of its existence, the tax didn't actually raise any money and so may not even raise the estimated $2 billion over the year.

Swan has responded with a big tax fudge. It has changed large company tax collections. I know you will weep for big business, which will pay tax monthly instead of quarterly.

This sleight of hand brings forward two months of payment - April and May - that would have previously been made in the next financial year. Companies have 21 days after the end of the quarter to pay their tax instalment. So they pay in July the tax for the quarter of April, May and June. Paying monthly means the April payment is made in May and the May payment in June, which brings them into this income year. This will improve the budget bottom line by about $5.5 billion, and wipe out the loss of revenue from the mining tax and company tax.

There have been other less well-publicised tax happenings. The business tax working group has collapsed. This was the group Swan set up to figure out a way of ending corporate tax rorts and provide enough money to pay for a significant company tax cut. Business wouldn't accept a cut in rorts - deductibility of exploration costs, accelerated depreciation, fuel subsidies and the like - to pay for its own general tax cuts. It wants to have its cake and eat it, too.

The amount of subsidies or grants big business receives through the tax system runs into tens of billions. But business is not the only group suckling on the teat of the tax system. The top 5 per cent of income earners receive $10 billion in superannuation tax grants.

But Labor - the party that axed its prime minister because the Minerals Council of Australia didn't want the resource super profits tax and then negotiated such a rotten deal with BHP, Rio Tinto and Xstrata that the much-restricted MRRT won't raise a brass razoo - isn't prepared to tax the rich or business. Between 2005 and 2008, 40 per cent of big businesses paid no income tax. Under the cover of the global financial crisis, the figure is almost certainly higher, although the ATO no longer makes it readily available.

Speaking of the ATO, Michael D'Ascenzo, the Tax Commissioner, has announced he will not be continuing after his seven-year statutory term ends in December. Jennie Granger, one of the three second commissioners, bailed earlier this year and now works for Britain's Inland Revenue. Another second commissioner retired, and the third one will retire next year if not sooner. A new one, from another department, started this month.

The question is - was the commissioner pushed, or did he jump? As Jean-Baptiste Colbert, Louis XIV's Minister of Finance, said: ''The art of taxation consists in so plucking the goose as to obtain the largest possible amount of feathers with the smallest possible amount of hissing.'' Under D'Ascenzo's reign there has been a lot of hissing from business. They don't like paying tax. On the other hand, the government wants more tax, to paint itself as fiscally responsible and deliver a budget surplus. It also wants and needs a happy ruling class.

This balancing act between the government's need for revenue and the need to keep business happy is what drove the pathetic compromise over the mining tax. D'Ascenzo could not pull off the same balancing act. In my view, he went soft on big business but not soft enough from its point of view. Although big business had essentially captured tax policy making, it hadn't captured tax administration.

The financial crisis and decline in global profit rates turned attention to the ATO and its ''outrageous'' demands that big business pay tax. Sidelining D'Ascenzo, whose replacement I suspect will come from private enterprise, is the government's way of responding to business criticism.

But since the capitalists are Oliver Twist writ large - please sir, I want some more - whose ALP and Liberal lackeys take turns to rule over us, they end up getting their way.

D'Ascenzo's replacement will be even more business friendly. Tax policy is already moving in the direction of taxing labour more and capital less. Tax administration will follow. The ATO's focus will shift further from big business to workers.

And as tax revenue from business continues to fall, in part because of tax avoidance, and the government finds its harder to squeeze more out of ordinary workers, it will further cut social welfare, health and education spending. Is there an alternative? Yes. Tax the rich. That is something Labor won't do.

Labor's Tax Trickery Masks Deeper Moral Conflict