The Winter Sitting of Federal Parliament ended last week and despite the Winter chill in Canberra, the debate about the repeal of the Minerals Resource Rent Tax (MRRT) was red hot. Caught up in this debate are the tax concessions and other social security measures that were to be funded by the MRRT. These include changes to the capital allowances for small business entities, the loss carry-back regime for companies, the payment of a superannuation co-contribution to low income individuals, the increase to the superannuation guarantee rate and the Schoolkids Bonus.
The Government made an election commitment to repeal the MRRT and its related measures and it is sticking to its guns. The end of the Winter sitting period curtailed round two of trying to get the MRRT and its related measures repealed to no avail. There were a number of attempts made in the Senate to maintain some of the associated measures that were to be funded by the MRRT. For now, there is no clear answer on what measures will stay and what measures will go, so taxpayers relying on the concessions and social security measures remain in limbo. Compounding the situation is the proposal to backdate the repeal of measures (see TaxVine Preamble - 27 June 2014 for more detail).
We are conscious of the difficult situation that members are in who are trying to advise clients in the face of uncertainty around these measures. We have been strongly advocating to the Government to end the impasse so that our members can confidently advise clients on these measures with certainty in the law supporting them.
The Spring sitting that begins on 26 August 2014 should see the resumption (and hopefully the conclusion) of this debate, resulting in certainty for taxpayers. We will keep a close eye on proceedings and keep members informed.
Please see below for other activities this week.
Robert Jeremenko CTA