26 Oct 12 Preamble – Friday, October 26 2012
What a week it's been! Beginning with MYEFO, the week reached a crescendo at the virtually simultaneous announcements in relation to Commissioner D'Ascenzo's resignation, the end of the Business Tax Working Group company tax rate cut reform process and release of the Trusts taxation rewrite Policy Options Paper.
MYEFO brought little joy or surprise for most. Tinkering with company tax instalment payments made the biggest news. However, hiding underneath were multiple changes that will also affect members, such as the denial of a concessional FBT treatment for in-house benefits acquired via salary-sacrifice, and legislative changes to alter the treatment of superannuation pensions paid after death. The ATO also got a $390 million boost in funding over the forward estimates period for compliance initiatives.
Just in case that wasn't enough excitement, the Trusts rewrite policy design paper was released on Wednesday afternoon, with more questions on and development of the previously aired options for reform. The Tax Institute will of course be significantly involved in this consultation process. We are aware that this rewrite is of great interest to our membership. If you are interested in contributing to our submission on the Policy Options Paper, please contact us at Tax Policy.
A mere hour later came the news that our Commissioner Michael D'Ascenzo AO will be retiring to take up a position at the Foreign Investment Review Board. The Tax Institute's relationship with the Commissioner has always been productive, honest and collaborative, and we thank him for his contributions. Our CEO Noel Rowland's farewell is contained in our press release, and thanks the Commissioner for the instigation of programs that have significantly improved the taxpayer and professional experience.
Latest in the day came the low-key release of the Business Tax Working Group's brief draft report which noted that consensus could not be reached in the business community for a revenue neutral package to fund a company tax rate cut. The end of the BTWG process is a missed opportunity to secure a company tax rate cut that would have yielded significant benefits for the economy. As such, we have called on the Government to renew its commitment to this reform via a revision of the terms of reference of the Working Group, including allowing consideration of broader reform options (such as changes to the base and rate of the GST).
Please see below for details of other activities this week.
Deepti Paton CTA