Expectation versus reality

here Many different taxes were discussed at the tax forum in October 2011 and we continue to analyse its outcomes.

binäre optionen raiffeisenbank The intention of the tax forum was to re-shape the tax system for the long term. One good thing that came from the event irrespective of the results is that it will re-energise the need for wholesale tax reform and breathe life back into the recently completed comprehensive review of the Australian taxation system (Henry Review).

http www topoption com Unfortunately the agenda for the tax forum had some serious omissions, the most notable of which was the exclusion from debate of the Goods and Services Tax (GST). Political considerations were the driving force for its exclusion, as most commentators agreed that the GST should have formed a central component of the discussions, especially if inefficient state taxes are to be removed. The fact that state taxes were included as part of the agenda makes the GST exclusion even more inexplicable.

forexte ikili opsiyon A recent study conducted by KPMG Econtech and Allen Consulting Group confirmed the widely held belief that replacing inefficient state taxes with more efficient taxes would have the potential to improve productivity, competitiveness and raise more revenue than the taxes it replaced.

source site The only reason that the Government held the forum was to appease the independents, as this was one of the undertakings it agreed upon to gain their support. We therefore have the independents to thank for re-invigorating the tax reform discussions to arrive at a future tax reform agenda.

follow The ideal time for this forum to have happened would have been after the release of the Henry Review. Unfortunately the debacle over the proposed mining tax took centre stage followed by a federal election that took the focus off tax reform entirely.

follow site wie zahle ich auf 24option paysafecard ein The participants

Over 180 participants were crammed in during the two-day tax forum and most of these were invited to provide statements that outlined their organisations’ main tax priority proposal and suggestions on how it could be funded.

The IPA was represented at the forum and we submitted a tax priority proposal where we stated that small-business income should receive preferential income tax treatment to reflect the inherent risks of running a business and to compensate for the disproportionate compliance costs they bear.

http://civilparties.org/?p=1141 The IPA proposal

Until significant improvements in the regulatory burden are achieved, some tax relief is warranted to restore the risk/ reward equation for small business. The SME sector needs to be rewarded with concessional tax rates to compensate for regulatory burden that they face being the unpaid bookkeepers for the regulators. Small-business income received by individuals is subject to progressive tax rates that apply to all individuals. While there are small business tax concessions in existence, most only provide marginal tax relief.

The cost of compliance and the regulatory burden on small business is disproportionate to their ability to absorb such costs relative to larger organisations. There is an inverse correlation between the size of the business and the relative cost of compliance.

The level of complexity facing small business with respect to taxation compliance has increased substantially over the past few decades. With the introduction and development of Fringe Benefits Tax (FBT), Capital Gains Tax (CGT), GST, paid parental leave schemes and compulsory superannuation our taxation system has become too onerous for most taxpayers, requiring the need to engage a professional tax adviser.

Over 95 per cent of businesses engage a tax practitioner to lodge their tax return. There is also a significant investment of a small business owner’s time in meeting administrative requirements of the regulators. The Fair Work Act has also added its own compliance issues into the mix. The proposal to increase the superannuation guarantee rate from 9 per cent to 12 per cent will also place significant cost pressures on small business.

If the carbon tax proposal is implemented there will be no direct assistance offered to small business to offset the cost increases which will eventuate when the flow-on impacts on rising energy costs work their way through the economy.

Large businesses have the capacity to absorb the additional cost of administration and cost increases; small business does not.

To address this imbalance we proposed a concessionary rate of tax for small-business income. This concessionary rate of income tax should apply irrespective of the type of business structure that has been used; sole trader, partnership, trust and company.

The proposal would operate on a similar basis to the existing entrepreneur tax offset (ETO), which the Government intends to abolish from 1 July 2012. The entrepreneur tax offset was an initiative set up to provide an incentive for small business in their early stages of development by offering them a tax offset of up to 25 per cent of the income tax attributable to a small-business enterprise (SBE) with a turnover of less than $75,000. The ETO entitlement is applied irrespective of the type of business structure chosen.

The ETO in its current form cut out too early for it to be of any assistance for the majority of small businesses, other than to assist small micro start-ups.

Small business would much prefer lower tax rates than many of the existing plethora of tax concessions, which they may not be able to fully exploit. Any other income earned by a small-business operator would be subject to existing progressive tax rates and would be unaffected by this measure. The current PSI rules would be used to circumvent taxpayers trying to convert employment income into business income.

The existing small-business turnover threshold ($2 million test) could be used to determine eligibility. Existing anti-avoidance rules provide necessary integrity measures to discourage larger businesses being separated into smaller entities to take advantage of a lower tax rate.

The proposal provides impetus to the small-business sector and could be used with other measures to address in part the two-speed economy.

http://revedecabane.com/?ower=app-android-segnali-opzioni-binarie&2cf=fa app android segnali opzioni binarie Measures to fund the proposal

The Institute suggested that the proposal could be funded by the removal of a host of existing and proposed small-business tax concessions.

First, the proposal of lowering of the corporate tax rate for small business would not be required. Given that less than one-third of small businesses use a corporate structure, this measure would not have benefited the majority of small-business owners. Non-business income derived by companies would not attract concessional tax treatment providing further savings. Incorporation creates additional compliance burdens which most small business owners try to avoid. Lowering the corporate tax rate is a Clayton’s measure in any case, as it reduces the imputation tax offset and merely offers deferral advantage.

Second, rationalising and streamlining the current small-business CGT concessions, as recommended by the Henry Review.

There are four separate small-business capital gains tax concessions available to qualifying businesses or their owners. The concessions are complex. They require taxpayers to navigate a legislative maze and threshold conditions and then additional conditions that relate to each of the specific concessions. Some of the existing concessions such as the 50 per cent reduction and the 15-year exemption are highly concessional and can eliminate any CGT liability when business owners exit their investment.

Third, the proposal for small business to be able to claim up to $5000 as an immediate deduction for the purchase of motor vehicles should also be reconsidered in favour of the above proposal. Not all small businesses benefit from this measure and it would be of more benefit for small-business owners to take advantage of a concessionary tax regime.

Fourth, review the array of small-business income tax concessions with a view to rationalise and streamline existing concessions. Also review some of the FBT concessions that are subject to rort.

http://mohsen.ir/?danilov=الفوز-الخيارات-الثنؠSeize the opportunity

The IPA is committed to tax reform and welcomed the opportunity to participate in progressing the debate and re-engaging with the recommendations contained in the Henry Review. While we strive to develop a long-term tax reform agenda addressing the macro structural changes required to maintain sustainable revenue base that promotes economic growth, interim changes are required to support the small-business sector.

The stakes are high when it comes to tax reform. If we do nothing we will miss the opportunity to reform our tax system. This will come back to haunt us in years to come when the current tax mix will be insufficient to fund rising government expenditures. Unlike most other western countries, Australia has the capacity to re-shape its future tax system if it can muster the political will to do so. This, however, will entail getting public support for changes required, which is never easy.

Leave a Reply

Your email address will not be published. Required fields are marked *