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13 Mar 09 Taxation Institute says CPRS draft legislation still "too taxing"

In a media release issued on 10 March 2009, the Taxation Institute of Australia has said that it is disappointed that the Government has not taken the opportunity in the Carbon Pollution Reduction Scheme (CPRS) exposure draft legislation released the same day (see below) to rectify a number of the policy shortcomings in the CPRS.

Taxation Institute President, Joan Roberts FTIA, said that the Taxation Institute continues to be concerned that under the current policy proposals there will be an increase in the cost to the community because of:
  • unnecessary compliance costs arising from the application of GST to permits; and
  • the collection of additional GST through input taxation of certain climate change derivatives.
"The additional compliance costs arise because finance trading markets do not currently apply GST to the items traded (shares, options, etc). As a result they will need to incur substantial costs in developing systems that are able to capture the GST in an electronic trading environment where sellers are not aware of the identities of buyers," Ms Roberts said.

“Whilst the exposure draft legislation is a crucial step forward in formulating a model to reduce of the impact of climate change on Australia, the Taxation Institute urges the Government to consult further to address these issues,” Ms Roberts said.  

For a copy of the Taxation Institute's media release, 10 March 2009, go here.

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