The Business Tax Working Group has completed its final report on the tax treatment of business losses: Business Tax Working Group – Final Report on the Tax Treatment of Losses (April 2012).
The Working Group considers that loss carry back would be a worthwhile reform in the near term. However, the Working Group has not had an opportunity to explore the relative net-benefit of loss carry back compared with other business tax reforms. The Working Group also recommends that the government undertake further work to develop a model for reforming the same business test. The Working Group considers that further analysis and consultation is required before any conclusions can be drawn on possible savings options to fund reforms to the tax treatment of losses.
The Working Group was established by the Treasurer following the government’s Tax Forum in October 2011, to look at how Australia’s tax system can best help businesses respond to the pressures of a changing economy. The Working Group is to consider reforms that can increase productivity and deliver tax relief to struggling businesses in a patchwork economy.