Proposed tax reforms a betrayal of small business

Original article by Robert Gottliebsen
The Australian – Page: 25 : 28-Aug-19

Treasurer Josh Frydenberg has stressed the need for incentives for businesses to invest by reducing taxes and red tape. However, the federal government’s actions are in fact contrary to its stated intentions. Amongst other things, the Coalition proposes to make directors personally liable for their company’s GST payments and empower the Australian Taxation Office to freeze GST refunds. Likewise, the government wants to introduce criminal penalties for making cash payments of $10,000 or more to any company that has an Australian Business Number. While these measures have the worthy aim of cracking down on phoenix companies and the cash economy, the government’s approach to their implementation has been a complete disaster and could ensure its loss at the next election.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY

Legislation needed to stop tax office overreach

Original article by Robert Gottliebsen
The Australian – Page: 25 : 22-May-19

There was bipartisan political support for the proposed independent small business tax tribunal ahead of the 2019 federal election. The lawyer-free tribunal was intended to address the toxic culture at the Australian Taxation Office with regard to its treatment of small businesses, but the ATO’s abuse of small businesses appears to be continuing. The newly re-elected Coalition government must take all necessary action to ensure that there is much-needed cultural change at the ATO.

CORPORATES
AUSTRALIAN TAXATION OFFICE, AUSTRALIA. OFFICE OF THE AUSTRALIAN SMALL BUSINESS AND FAMILY ENTERPRISE OMBUDSMAN, AUSTRALIA. ADMINISTRATIVE APPEALS TRIBUNAL

Treasury ignored in race to cut taxes

Original article by Michael Roddan
The Australian – Page: 2 : 2-Jan-19

The Treasury has confirmed that it did not undertake any economic modelling on the federal government’s plan to bring forward tax cuts for companies with turnover of less than $50m a year. However, Treasurer Josh Frydenberg says the tax package had been subject to revenue costing. Legislation to reduce the tax rate for small and medium enterprises to 25 per cent in 2021-22 rather than 2026-27 was passed with the support of Labor in October.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN LABOR PARTY

Labor flags flip on small biz tax cuts

Original article by Phillip Coorey
The Australian Financial Review – Page: 3 : 12-Oct-18

Federal Opposition Leader Bill Shorten has signalled that Labor remains open to backing legislation to bring forward tax cuts for small and medium enterprises. He says a prerequisite would be that there is no impact on government funding for hospitals and schools. The tax cuts for businesses with turnover of up to $50m have already been legislated, but the federal government wants to reduce the tax rate to 25 per cent in 2021-22 rather than 2026-27.

CORPORATES
AUSTRALIAN LABOR PARTY, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIA. DEPT OF FINANCE, CENTRE ALLIANCE, AUSTRALIAN CHAMBER OF COMMERCE AND INDUSTRY, BUSINESS COUNCIL OF AUSTRALIA, LIBERAL PARTY OF AUSTRALIA

Companies’ tax cuts on fast track

Original article by Simon Benson
The Australian – Page: 1 & 2 : 11-Oct-18

The federal government intends to bring forward a reduction in the tax rate for small and medium enterprises. Prime Minister Scott Morrison is set to announce that the SME tax rate will be reduced to 26 per cent in 2020-21 and 25 per cent in 2021-22. The full tax cuts package for SMEs was originally slated to take effect in 2026-27. The government began looking into fast-tracking SME tax cuts under former prime minister Malcolm Turnbull, after it dropped plans to reduce the tax rate for large companies.

CORPORATES
AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIAN LABOR PARTY, UNIVERSITY OF MELBOURNE. INSTITUTE OF APPLIED ECONOMIC AND SOCIAL RESEARCH, AUSTRALIA. DEPT OF JOBS AND SMALL BUSINESS, AUSTRALIA. DEPT OF THE ENVIRONMENT AND ENERGY, BUSINESS COUNCIL OF AUSTRALIA, ENERGYAUSTRALIA PTY LTD, SEEK LIMITED – ASX SEK, INCITEC PIVOT LIMITED – ASX IPL

PM ups the ante on small biz tax cuts

Original article by Phillip Coorey
The Australian Financial Review – Page: 5 : 21-Sep-18

Federal government sources have indicated that the Coalition is likely to seek to pass legislation prior to the next election aimed at bringing forward tax cuts for businesses with turnover of up to $50m. The tax relief for small businesses has already been legislated, but additional legislation would be required for the cuts to take effect earlier than 2026-27. Labor opposes a further reduction in the small business tax rate, but it could face the prospect of having to go into the election with a policy of reversing the additional tax cuts.

CORPORATES
AUSTRALIAN LABOR PARTY, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, CENTRE ALLIANCE, ONE NATION PARTY

Small business tax cuts miss the point

Original article by Ronald Mizen
The Australian Financial Review – Page: 7 : 30-Aug-18

Prime Minister Scott Morrison recently signalled that the small and medium business sector will be the focus of his government’s company tax policy. However, Jeremy Thorpe of PricewaterhouseCoopers argues that tax cuts for the small business sector should not be a priority as such businesses generally do not need to be globally competitive. Grant Wardell-Johnson of KPMG agrees, noting that large companies deliver the great economic benefit from tax cuts.

CORPORATES
AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, PRICEWATERHOUSECOOPERS AUSTRALIA (INTERNATIONAL) PTY LTD, KPMG AUSTRALIA PTY LTD, ERNST AND YOUNG, AUSTRALIAN LABOR PARTY

Small firms get cuts, but big business creates jobs

Original article by Adam Creighton
The Australian – Page: 4 : 5-Jun-18

The proportion of Australian workers who are employed by small businesses fell from 44.4 per cent to 43.8 per cent in 2016-17. The first phase of the Federal Government’s tax cuts for small businesses took effect on 1 July 2015, but the sector has accounted for just 18 per cent of jobs that have been created since then. University of Tasmania economist Saul Eslake says the figures demonstrate that taxing small businesses at a lower rate than large companies does not generate more jobs.

CORPORATES
UNIVERSITY OF TASMANIA, ALPHABETA, XERO LIMITED – ASX XRO

Company tax cut eligibility ‘mind-boggling’

Original article by Joanna Mather
The Australian Financial Review – Page: 5 : 11-Jul-17

Tax experts say the Australian Taxation Office’s updated advice on the application of small business tax cuts to passive family investment companies does little to clarify the situation. The ATO previously advised that the 27.5 per cent tax rate will apply to companies whose activities are "passive", but this has been changed to "relatively passive" in a revised statement. Mark Leibler of law firm Arnold Bloch Leibler says the Federal Government clearly intended for the tax cuts to apply solely to businesses that actively trade.

CORPORATES
AUSTRALIAN TAXATION OFFICE, ARNOLD BLOCH LEIBLER, THE TAX INSTITUTE, AUSTRALIA. DEPT OF FINANCE, AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN COUNCIL OF SOCIAL SERVICE

Scurry to plug tax loophole for the wealthy

Original article by Nick Tabakoff
The Australian – Page: 2 : 5-Jul-17

Financial Services Minister Kelly O’Dwyer has advised the Australian Taxation Office that the Federal Government’s tax cuts for small businesses were not meant to apply to passive family investment companies. BDO’s Tony Sloan argues that the ATO is merely applying the existing tax cuts legislation, which he says is sufficiently broad to include family investment vehicles. Sloan adds that the Government may have to amend the legislation in order to ensure that such investment vehicles cannot claim tax refunds and deductions.

CORPORATES
AUSTRALIA. DEPT OF FINANCE, AUSTRALIAN TAXATION OFFICE, BDO CHARTERED ACCOUNTANTS AND ADVISERS, AUSTRALIAN LABOR PARTY, AUSTRALIA. DEPT OF THE TREASURY