27 Jul 1212 Preamble - 27 July 2012
It's been another busy week with The Tax Institute appearing before two separate Parliamentary Committee hearings into important tax changes.
Living Away From Home Allowance
On the morning of Thursday 26 July, Elizabeth Lucas ATI (Grant Thornton) joined me and Tax Counsel Deepti Paton ATI in appearing before the House of Representatives Standing Committee on Economics. The Committee was holding a public hearing for its inquiry into the provisions of the Tax Laws Amendment (2012 Measures No. 4) Bill 2012, specifically around the Living Away From Home Allowance changes.
We argued that as the Bill represents a change in policy intention underpinning the LAFH rules, rather than a mere countering of exploitation of the current rules, this should be clearly stated in the Explanatory Memorandum. Also, the tax treatment of LAFH allowances should be determined either in the context of the income tax laws, or the FBT laws, but not both (as is currently the case under the Bill). Clarification around transitional relief should also be provided. You can access a copy of our submission to the Committee here.
On Thursday afternoon, Damian Preshaw FTI (KPMG) joined me in appearing before the Senate Economics Legislation Committee, which was inquiring into the provisions of the Tax Laws Amendment (Cross-Border Transfer Pricing) Bill (No.1) 2012.
We emphasised the importance of tax laws to taxpayer decision making and behaviour. We strongly supported working within a framework of guiding principles when introducing tax laws in order to provide taxpayers with greater certainty in relation to their tax liabilities and affairs. Of these principles, among the most fundamental is that legislative changes should not apply retrospectively except in very specific circumstances. You can access a copy of our submission to the Committee here.
Robert Jeremenko CTA