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Rudd rules out raising GST rate
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| Posted by admin on Wednesday, April 23 @ 02:22:03 SGT (845 reads) |
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Prime Minister Kevin Rudd has stuck to his election promise not to raise the GST in a "root and branch" review of the tax system, but some economists said the GST was low by world standards.
While the prime minister has not committed to a time frame for the review, he said it was time for a "top-down" look at the system, suggesting there had not been a serious look at taxation for more than 20 years.
Plans for a major review have been welcomed by business groups, although the prime minister was on Tuesday forced to rule out any rises in the GST.
With many Australians already struggling with high interest rates and rising food prices, any change in policy that would add to their cost of living would likely cause outrage.
A spokesman for the prime minister on Tuesday said the GST remained off limits.
"The prime minister made it crystal clear before the election that there would be absolutely no increase in the GST under a Rudd Labor government," he said.
"The prime minister said before the election that over his dead body would there be an increase in the level of the GST. That commitment still stands and will not be changing in the future."
Opposition Leader Brendan Nelson labelled Mr Rudd a fraud over his plans for tax reform.
"What kind of fraud is Mr Rudd pretending to be, when he suddenly turns around, the day after his 2020 talkfest, and says he is now a convert of root-and-branch reform of the Australian tax system?" Dr Nelson said on Tuesday.
He also hit out at claims by Mr Rudd that the former Howard government did nothing to reform the tax system.
"John Howard almost lost government giving Australia's future the tax systems that it needs to fund our schools, our hospital, our roads and our defence forces," Dr Nelson said.
While Mr Rudd ruled out tinkering with the GST, taxation experts maintain it should be looked at, saying it is low by world standards.
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Tax Board head calls for GST increase
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| Posted by admin on Wednesday, April 23 @ 02:14:53 SGT (817 reads) |
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The chairman of the Board of Taxation says it is a pity that the Government has ruled out raising the GST as part of possible changes to the tax system.
Prime Minister Kevin Rudd says increasing the GST will not be considered as part of the Government's comprehensive review of taxation.
But Taxation Board chairman Dick Warburton has told Lateline Business that increasing the GST must be considered in order to reduce other taxes.
"I do believe there's room to go to 12 or 15 per cent, but I'm not saying that's what we should go to, I'm just saying we should debate that issue," he said.
"If we do go to 12 or 15 per cent, we could look at some relief in other areas."
-abc.net.au
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| Posted by admin on Wednesday, April 23 @ 02:11:04 SGT (3747 reads) |
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Prime Minister Kevin Rudd has indicated he is keen to undertake a major reform of Australia's tax system.
Mr Rudd says the system is too complex and has criticised the former Coalition government for not making changes.
"For the 11 years or 12 years that the Howard Government was in office, the opportunity for a top-down review of the entire taxation system was there," he said.
Tax reform was one of the issues raised with Mr Rudd at his 2020 summit at the weekend and he has told ABC TV's 7:30 Report that the Federal Government will respond by the end of the year.
"I actually think we are getting to that time when we need to have a top-down look," he said.
"I won't commit to the next two years ... but I think it's actually time we looked at a root and branch reform of the Australian taxation system.
"But we will come back formally on that later in the year."
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Swan talks up Budget tax cuts for low-paid
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| Posted by admin on Wednesday, April 23 @ 01:54:56 SGT (718 reads) |
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Federal Treasurer Wayne Swan says all tax payers will benefit from tax cuts in next month's Budget - but low and middle income earners will be the biggest winners.
People earning $40,000 will receive cuts worth around $20 a week but Mr Swan says the cuts will not be restricted to lower income groups.
"Certainly everybody's getting a bit, but as you'd be aware, compared to the Coalition, we've pulled back some of their proposals to deliver tax relief at the very top," he said.
"We think it's really important that we have some fairness in the tax system.
"These people [that] have missed out substantially in the last decade or so when it's come to the priorities of the previous government, they're fairly and squarely the priority of the Rudd Labor Government."
-abc.net.au
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Court reserves decision in GST case
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| Posted by admin on Tuesday, April 15 @ 22:51:30 SGT (3892 reads) |
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Legal submissions have finished and the High Court has reserved its decision in a case which could have widespread ramifications for the Goods and Services Tax (GST).
The Tax Commissioner is appealing against a ruling made by the Federal Court in the Reliance Carpet case.
The court found GST could not be charged on a deposit which had been surrendered in an aborted property deal.
This afternoon the counsel for the respondent, Jennifer Batrouney SC, examined the purpose of a deposit.
She argued that a deposit is paid wholly for the vendor's benefit, and not for the rights and obligations of a contract.
The case has been closely followed by analysts who say millions of dollars of tax revenue is in play and the Tax Office could be liable to pay widespread refunds.
-abc.net.au
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High Court case to challenge GST definition
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| Posted by admin on Tuesday, April 15 @ 22:46:21 SGT (498 reads) |
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By finance reporter Adrian Thirsk
The fundamental operation of the Goods and Services Tax (GST) is under challenge and has gone all the way to the High Court.
And potentially, refunds could be due to millions of consumers and businesses who have been wrongly charged GST.
The GST was introduced in July 2000, but eight years later the basic question about it remains - what constitutes the supply of goods and services?
The Reliance Carpet case, being heard in the High Court from today, is testing whether GST is payable on a deposit forfeited in an aborted property deal.
In a rebuke for the Taxation Office, the Federal Court found GST could not be charged on a deposit which had been surrendered in a property deal that failed to proceed.
The Tax Commissioner is appealing.
Tax experts say the principles of the case might apply more broadly to cancellation fees, late fees, break fees and the like - and refunds could be in order.
PricewaterhouseCoopers partner, Kevin O'Rourke, says it is an important case.
"It's a bit like income tax, where you have to determine what is income," he said.
"Under the GST you have to determine what is a supply, because without supply there is no GST."
Mr O'Rourke says even if the Tax Commissioner loses in the High Court, the Government might act retrospectively to tighten up the legislation and protect its tax base.
"It wouldn't be the first time where revenue was considered to be at risk by the Tax Office - where the Government has stepped in and put in place retrospective legislation, effectively to deny those refunds," he said.
-abc.net.au
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ATO sends criminals tax bills
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| Posted by admin on Monday, April 07 @ 23:26:05 SGT (852 reads) |
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Assistant federal Treasurer Chris Bowen says the Australian Taxation Office has sent out about $75 million in tax bills as part of an effort to make sure criminals are paying their fair share of tax.
Mr Bowen says the ATO has been working with the Australian Crime Commission to compare the assets and lifestyle of criminals with their tax records.
He says so far a substantial amount of money has been collected, but in some cases the taxes are being paid on the proceeds of criminal activity.
"It's not only the proceeds of crime, it's other proceeds as well," he said.
"Anything which the individuals concerned tell the Crime Commission which doesn't quite add up in terms of what they've told the Tax Office, gets dealt with.
"So it does include proceeds of crime but it's not only proceeds of crime."
Mr Bowen says paying the taxes does not legitimise criminal activity.
"I think that Australian taxpayers would expect ... that any outstanding issues in relation to their tax bills are followed up as well," he said.
"That's exactly what the tax office, in conjunction with the other agencies, is doing."
-abc.net.au
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Opposition backs Govt's tax cuts
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| Posted by admin on Saturday, March 29 @ 22:27:23 SGT (168 reads) |
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The Coalition says it supports Labor's planned tax cuts for the next financial year.
Labor promised $31 billion of cuts over three years during the election campaign.
Treasurer Wayne Swan says low-income earners were neglected by the Howard Government and they will be the winners in this year's Budget, after the first round of cuts kick in on July 1.
They are expected the receive around $20 a week more in their pay packets.
He says the money will have the biggest impact on the people who need it most.
"In the past they've been left out and the tax cuts have gone to those at the top end,'' he said.
"But the focus of the tax cuts that begin from the Rudd Government on July 1 are people like hairdressers, mechanics, child care workers, teachers aides, tradies [sic] and labourers."
But Opposition Leader Brendan Nelson says the Government is only copying the Coalition's tax policy.
"Mr Rudd and Mr Swan have done a copycat job and they're now bringing in tax cuts announced by Mr Howard and Peter Costello just before the election last year," he said.
"We expect those to be delivered in full during the Budget."
-abc.net.au
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Tax cuts for low-paid workers: Swan
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| Posted by admin on Saturday, March 29 @ 22:25:08 SGT (186 reads) |
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Federal Treasurer Wayne Swan says tax cuts to come into effect next financial year will benefit lower paid workers and working mothers.
Mr Swan said the federal government was working to keep inflation under control, so the tax cuts should not be swallowed up by further interest rate rises.
"People on lower and middle incomes will be the significant beneficiaries of the Rudd government's tax cuts," Mr Swan told reporters in Brisbane today.
"They have been left behind in the past and have worked hard to make our economy strong - now the Rudd government will deliver for them."
Mr Swan said the May budget would include tax cuts targeted at lower paid workers.
Workers earning $35,000 a year will get a tax cut of around $20 a week.
Australia's biggest blue-collar union, the Australian Workers' Union, says the tax cuts will be swallowed up by interest rate rises and the money should go to increase superannuation contributions.
-aap-smh.com.au
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Tax cut plan 'punishing working Australians'
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| Posted by admin on Sunday, February 10 @ 23:10:57 SGT (189 reads) |
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Federal Opposition Leader Brendan Nelson says it is unfair for the Government to punish hardworking Australians by withholding future tax cuts.
Prime Minister Kevin Rudd says tackling inflation is a higher priority than delivering future tax cuts.
The Government has signalled any extra revenue will go towards boosting the budget surplus, meaning any future tax cuts are not guaranteed.
But Dr Nelson says workers deserve tax relief.
"In the end, that is money that's been earned by hardworking Australians," he said.
"It doesn't surprise me that Labor's basic starting point is that they're not going to look at tax cuts in the future, that should be no surprise to any of us."
-abc.net.au
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Tax cuts safe as Labor seeks budget cuts
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| Posted by admin on Monday, January 07 @ 21:15:52 SGT (382 reads) |
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Tax cuts will escape the axe as the federal government searches for ways to cut spending as a hedge against inflation.
The Rudd government will run a strict eye over all commonwealth spending - particularly promises made by the previous Howard government - as it looks to save billions of dollars ahead of the May 13 budget.
Fifteen billion dollars worth of coalition promises, due to be introduced over the next four years, will be placed under scrutiny.
But Finance Minister Lindsay Tanner promised the Labor government would not renege on its $31 billion in promised tax cuts.
The opposition claims Labor is trying to rewrite history by painting the Howard government as bad economic managers in order to blame them when interest rates go up again.
Two of Australia's biggest banks last week raised interest rates independently of the Reserve Bank of Australia (RBA), which will examine the case for another hike on February 5.
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Labor didn't honour 1993 tax cuts: Costello
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| Posted by admin on Wednesday, October 31 @ 08:07:27 SGT (209 reads) |
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Federal Treasurer Peter Costello is using a 14-year-old Labor backtrack on tax cuts to attack his Opposition counterpart.
Mr Costello says Labor failed to deliver promised tax breaks after the 1993 election, even though they were put into law.
He says the Coalition has honoured its tax policy and has urged voters to compare that to Labor.
"Not only did they promise them, they put them into law," he said.
"They won that election and after the 1993 election they took those tax cuts away and Wayne Swan, the shadow treasurer, voted to take those tax cuts away. They were never delivered."
But Mr Swan has defended Labor's record.
"What happened was that those cuts were delivered, as you know, and the second tranche went to super which you guys claim the credit for," he said.
"You can't claim the credit for super then turn around and say we broke our promise."
-abc.com.au
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Labor candidate retracts GST comments
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| Posted by admin on Wednesday, October 24 @ 07:38:09 SGT (193 reads) |
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A Labor candidate for the New South Wales seat of Robertson has been forced to backtrack on comments she made about the GST.
In an embarrassment for Labor, Belinda Neal today suggested the state could get a greater share of GST payments if Kevin Rudd wins the election.
She said her party's treasury spokesman Wayne Swan had promised to review the GST formula if Labor wins government.
But Mr Rudd was quick to rule out a review, and tonight Ms Neal has released a statement saying her earlier comments were wrong.
She says Labor opposes any increase in the GST rate or changes to the process for handing out GST payments.
-abc.com.au
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Costello, Swan scrap over tax policies
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| Posted by admin on Sunday, October 21 @ 06:04:52 SGT (188 reads) |
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The battle of the tax policies has escalated with Treasurer Peter Costello accusing Labor of a blunder that would cost four million taxpayers an extra $600 a year.
In turn, Labor has accused Mr Costello of a humiliating backflip in which he belatedly revealed tax thresholds omitted from the government's tax announcement last week.
Mr Costello and Labor treasury spokesman Wayne Swan spruiked their respective tax policies on current affairs television programs.
Mr Costello said Labor's blunder occurred because neither Opposition Leader Kevin Rudd or Mr Swan understood tax policy.
You will be paying $600 additional tax for everybody above $37,000. That is 45 per cent of taxpayers will be worse off," he told the ABC.
Mr Costello said the government plan was for 45 per cent of taxpayers to be on a marginal tax rate of 15 per cent within five years.
To achieve that, the 15 per cent tax threshold would need to rise from $37,000 to $41,000.
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Labor has no tax plan, Costello says
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| Posted by admin on Tuesday, October 16 @ 07:58:31 SGT (181 reads) |
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Treasurer Peter Costello is urging Labor to respond to his $34 billion tax plan.
Mr Costello and Prime Minister John Howard have announced a plan whereby 2 per cent of taxpayers would pay more than 35 cents in the dollar in tax in five years.
Mr Costello says Opposition Leader Kevin Rudd should spell out his response or reveal Labor's tax plan.
"If Labor is interested in good tax policy they will support this tax plan," he said.
"There's no doubt about that. In fact they would have done it yesterday but the longer it goes on the more they try and hide on this issue, the more you begin to wonder about them.
"They have no tax plan - that's obvious."
Mr Costello says the Coalition's tax plan would boost economic growth.
"The biggest, boldest tax plan that we've seen in a long time is presented yesterday," he said.
"It deals with participation, competitiveness, building capacity in the Australian economy and what does Kevin Rudd say? Nothing."
Deputy Opposition Leader Julia Gillard says the delay is because Mr Rudd is an economic conservative.
"We're going to study what was released yesterday," she said.
"It's important economic information and we'll take our time and we make make absolutely no apology for that.
"We want to study all of the information - Kevin is an economic conservative, you would expect him to proceed in a careful, prudent and measured manner and he will."
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Coalition keeps up pressure on Labor over tax
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| Posted by admin on Tuesday, October 16 @ 07:52:29 SGT (178 reads) |
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John Howard and Peter Costello have used a visit to a small business in the marginal New South Wales electorate of Eden-Monaro to push the Coalition's plan to progressively reduce the tax rates.
Mr Costello says the Coalition is the only party to release a plan for Australia's economic future and he is continuing to pressure Labor to release its tax plan.
Mr Howard says the Coalition's $34 billion proposal will encourage more people into work, or to start their own business.
"Our tax plan is not just about putting extra dollars in the pockets of middle Australia but it's very much about further growth of the Australian economy," he said.
"It's about providing additional incentives for people to work. It's about lifting productivity. It's about continuing our growth and opportunity society."
Deputy Opposition Leader Julia Gillard says Labor will not be bullied into rushing out a tax policy, saying that John Howard took his time in 1996.
"We know of course Mr Howard when he was opposition leader didn't announce his tax plan until weeks into the campaign," she said.
Greens leader Bob Brown says the tax cuts will benefit wealthy Australians but the money should be spent on services such as health and education which would benefit all of the community.
"The big end of town has to be happy with Peter Costello's $34 billion tax cuts, but it's the wrong way for Australia," he said.
"These tax cuts should have been channelled into making this country a fairer country."
-abc.com.au
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Tax cuts will 'put pressure on inflation'
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| Posted by admin on Monday, October 15 @ 07:29:17 SGT (176 reads) |
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Some economists are warning sweeping tax cuts announced by the Coalition today will make the Reserve Bank nervous and could push interest rates higher.
Prime Minister John Howard and his Treasurer Peter Costello today announced income tax cuts worth $34 billion over the next three years.
Mr Costello says the plan would still mean the Government's underlying budget surplus would remain above 1 per cent of gross domestic product.
Senior economist with HSBC, John Edwards, says the tax cuts would put upward pressure on inflation.
"It certainly means interest rates would be higher than they would otherwise be," he said.
"I cannot imagine were it not for an election the Treasurer would be contemplating these tax cuts of this order.
"It means that household consumption is going to be higher than it otherwise would be, residential construction is going to be higher than it otherwise would be.
But Mr Costello says by lowering tax rates and raising thresholds, Australian's will be better off and inflation will not be pressured.
"Let me make the point if you'd have spent the money you could have inflationary consequences, but to return it to people and to help them with their bills at a time when they're facing cost of living pressures, I think is a very responsible thing to do," he said
Peter Hendy from the Australian Chamber of Commerce and Industry (ACCI) agrees.
"The fact is that the Australian economy can always easily afford income tax cuts," he said.
The Chamber of Commerce also says the proposal to reduce the top tax rate by 5 per cent will make the Australian tax system the most competitive in the world.
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Howard produces tax cut surprise
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| Posted by admin on Monday, October 15 @ 07:06:50 SGT (182 reads) |
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Prime Minister John Howard has unveiled his first major promise of the election campaign with a bold plan for $34 billion in tax cuts.
Months after warning government backbenchers that he had no rabbits in his hat to stave off electoral annihilation, Mr Howard kicked off day one of the campaign by promising tax cuts for everyone.
Average income earners would get a $20 weekly cut from next July, rising to $35 by July 2010, while the top tax rate would be cut from 45 cents in the dollar to 40 within five years if the coalition wins the November 24 election.
Mr Howard described the package as a bold plan for Australia's future, while Treasurer Peter Costello said it was part of the coalition's "go for growth" strategy.
And with the mid-year economic review showing a budget surplus of $14.8 billion - $4.2 billion more than forecast just five months ago - Mr Howard hinted that he had more surprises up his sleeve.
"You were inaccurately briefed out of the party room," a straight-faced Mr Howard told reporters when asked if this was his rabbit.
The announcement so early in the campaign took Labor by surprise.
Opposition treasury spokesman Wayne Swan said Labor had not had time to study the plan or the mid-year economic review, which is usually released in late December.
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Govt mute over its new tax policy
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| Posted by admin on Tuesday, October 02 @ 06:18:06 SGT (166 reads) |
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The coalition will go to the federal election without a new tax policy, with Treasurer Peter Costello saying the government's policy was outlined in this year's budget.
But Mr Costello hinted at further tax cuts if the coalition is re-elected this year.
With both Prime Minister John Howard and Labor leader Kevin Rudd campaigning in the key state of Queensland this week, Mr Costello attacked the opposition for having no tax policy.
A Newspoll showed that while Labor is still heading for a landslide win, voters trusted Mr Costello with the economy more than Labor's treasury spokesman Wayne Swan.
"It is clear that the public does not trust Labor to manage the economy and there is a good reason for that - they haven't produced a tax policy," Mr Costello told reporters in Melbourne.
But asked when the coalition would release its tax policy, Mr Costello said it was already out there.
We released it of course in the budget when we cut taxes from 1 July 2007 and we have legislated another tax cut on 1 July 2008," he said.
The treasurer left the door open to further cuts if the economy stayed strong.
"I think if we can keep the Australian economy growing strongly that we ought to aim to keep taxes low," Mr Costello said.
"We ought to aim to make Australia one of the low tax countries of the OECD. We have got it down to eighth lowest out of 30.
"If we can continue to grow the Australian economy, it ought to be our aim to keep taxes as low as possible, and if we can, become more competitive as against other countries in the OECD."
Earlier, on ABC radio, Mr Costello was dismissive when a caller challenged him on his criticism of Mr Swan as inexperienced, pointing out that the treasurer was just as green when elected 11 years ago.
"I thank David for his call but I don't think it is quite fair to compare me to Wayne Swan ... I don't think many people would like to be compared to Wayne Swan," he said.
Mr Rudd seized on the comments, saying Mr Costello was showing his true colours while Mr Swan was doing a terrific job.
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ATO says taxpayer debt growth is slowing
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| Posted by admin on Friday, September 21 @ 08:08:25 SGT (207 reads) |
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The Australian Tax Office (ATO) says it has managed to slow the growth of debt it is owed by taxpayers and companies who do not fully pay their workers superannuation.
ATO officials have been giving evidence on a range of tax issues at a federal parliamentary hearing today.
They say the speed of growth in debt levels has been reined-in for the past two years.
Deputy tax commissioner Mark Konza says there is a significant problem with businesses being run into the ground and resurrected as new entities to avoid obligations.
"Phoenixing is a blight on the Australian economy and a not insignificant burden on the tax system," he said.
"We do have officers who chase up very significant phoenix cases and try and get criminal prosecutions for fraud and for that sort of thing.
"But a $10,000 super guarantee debt wouldn't figure there very highly."
-abc.com.au
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Govt says no to fishing tackle tax
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| Posted by admin on Tuesday, September 11 @ 08:10:27 SGT (193 reads) |
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The federal government has categorically ruled out taxing recreational fishing tackle.
The government has given almost $200,000 to peak fishing lobby group RecFish Australia to investigate ways of making recreational fishing self-sustaining.
A tackle tax is one of the many possibilities RecFish will examine.
But asked about a potential tax in parliament on Tuesday, Fisheries Minister Eric Abetz said it was definitely not on the government's agenda.
"The government has absolutely and utterly ruled out imposing any tax on the recreational fishing sector in the form, or any other form, suggested by (Labor's fisheries spokesman) Senator (Kerry) O'Brien," Senator Abetz said.
Senator O'Brien then asked Senator Abetz why RecFish had been given $200,000 of taxpayers' money to investigate a measure the government says will never be implemented.
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Land tax bills up sharply, group warns
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| Posted by admin on Thursday, August 09 @ 10:20:28 SGT (163 reads) |
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land tax lobby group claims the latest round of property valuations by the South Australian Government could lead to a doubling of tax bills for some investors.
The valuer-general has declared an average 8 per cent increase for the financial year just ended.
Land Tax Reform Association chairman John Darley says the rise in property values will not necessarily translate to a land tax increase of the same size.
"Land tax is a progressive tax and it's based on the total valuation, total value of all properties within an ownership and so you could have a situation where an 8 per cent rise in valuation could translate to a 100 per cent rise in land tax or even more," he warned.
-abc.com.au
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Taxman targets directors, executives
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| Posted by admin on Wednesday, July 18 @ 06:28:41 SGT (170 reads) |
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-Leon Gettler
The taxman is calling in some of the country's highest paid directors and executives to explain certain discrepancies in their employee share plans.
Tax commissioner Michael D'Ascenzo said that the Australian Taxation Office has identified 601 individuals, the top highest-paid directors and executives in Australia's biggest companies "as having a possible taxing point under a share plan."
In an address to the Australian Institute of Company Directors, Mr D'Ascenzo said 216 of these individuals had "potential discrepancies relating to a cessation time, some over multiple tax year."
"Cessation time" is the term given to that point of time when the executive or director has to pay tax on the options and shares.
Under the existing complex rules, this can come at different times such as when they were granted the equity, when they exercised the options and when their 10 years with the company is up.
"While there may be various explanations for the discrepancies we are in the process of sending individual questionnaires to a test pool of 30 individuals seeking clarification," Mr D'Ascenzo said.
Apart from share schemes, the ATO is also stepping up its surveillance of overseas tax havens.
"We are increasing our audit activities on taxpayers who deal with tax havens and try to conceal their income and assets offshore," he said.
He said the ATO was now encouraging taxpayers to come clean on undisclosed income from offshore activities. If they did that, he said, they were more likely to get off lightly.
"Taxpayers who contact us before they are the subject of an audit and make a full and true disclosure will have reduced shortfall penalty," he said. "The Commonwealth Director of Public Prosecutions has indicated that an indemnity from criminal prosecution may be granted in certain circumstances."
-smh.com.au
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Businesses running up higher tax debts
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| Posted by admin on Friday, July 13 @ 06:17:02 SGT (3727 reads) |
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Australian businesses are running up an unpaid tax bill, leading to concerns that more companies will be forced into voluntary administration if times get tough.
Stan Traianedes, a corporate insolvency partner at accounting firm McLean Delmo Hall Chadwick, says companies across the country are running up bigger tax debts in a time of high insolvency rates.
The Australian Tax Office (ATO) says there was $10.1 billion in collectable debt at the end of March this year, the majority of which is attributed to the business community.
It says collectable debt as a percentage of revenue collections has risen from 2.7 per cent in 1995-06 to 4.4 per cent in 2005-06.
"Many businesses carry some debt burden," Mr Traianedes says.
"However, claims against companies by the Australian Taxation Office in the form of penalty notices issued against directors for PAYG (pay as you go), remain the single biggest trigger for directors placing companies into voluntary administration."
Voluntary administration involves the appointment of an external party to investigate the company's affairs, report to creditors, and make recommendations about the company's futures.
Mr Traianedes says once the ATO has issued a company a notice to pay its debt, it is often hard for the business to avoid voluntary administration.
He says the directors can be held personally responsible for a company's tax debts.
"My suggestion to companies in trouble is to take early action and get financial advice," Mr Traianedes says.
"Early steps are the best way to get a successful outcome and increase the chances of rehabilitating a business."
Nationally, 7,737 companies entered external administration in 2006, up from 7,277 in 2005.
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Beware, tax office on prowl: H&R Block
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| Posted by admin on Tuesday, July 10 @ 06:40:42 SGT (166 reads) |
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If you work in tourism, construction, security, mining or the fitness and sporting industry, be careful how you fill in your tax form - the tax office is watching you.
Tax consultant H&R Block says in a report to help people prepare for their 2007 tax return that these occupations are being targeted by the Australian Taxation Office (ATO) this year.
But this does not mean that other occupations are safe.
It also lists a series of common errors across all occupations.
It says self education claims have been a particular area of focus for the tax office for the past few years.
It says for example that a pharmacy assistant cannot claim the course costs of the Bachelor of Pharmacy course they are undertaking full time, whilst working part time as a pharmacy sale assistant in a pharmacy.
For motor vehicle claims, you can usually only claim car expenses for travelling for work, not travelling to work. And you must have records to justify the claim.
And if you salary sacrifice your car - in other words the employer provides the car as part of your salary package - you cannot claim any running expenses of the car whatsoever.
The ATO is also active in ensuring that income from overseas in the way of pensions, interest dividends and rent is declared.
H&R Block says Tax and Revenue Offices worldwide are increasingly sharing information with each other and the tax office in Australia uses this information to check returns lodged in Australia.
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Tax cuts come into effect
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| Posted by admin on Sunday, July 01 @ 05:43:41 SGT (170 reads) |
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The tax cuts promised in May's Federal Budget come into effect today, just months before the Federal election is due.
Those earning between $30,000 to $40,000 will receive tax cuts of about $1,100 a year.
Labor's Treasury spokesman Wayne Swan supports the tax cuts - he has even taken credit for them.
"These are proposals we put forward in 2005," he said.
"Peter Costello has made lower and middle income earners wait two years.
"Labor fought very hard for these tax cuts for low and middle income earners, so we're pleased they've been delivered.
"Tax cuts are always preferable if they're affordable."
But Mr Swan says he remains suspicious about the timing.
"It seems that tax cuts for low and middle income earners only ever come when Peter Costello has his triennial spending spree," he said.
Mr Swan says Labor wants to see more tax relief for those who are the second income earners in a family.
But the Federal Treasurer, Peter Costello, says more income tax cuts are already in the pipeline.
"We're not only cutting tax as of the first of July this year, but we've legislated another tax cut for July 1 next year," Mr Costello said.
But he will not directly say if the tax relief will have a political pay-off.
"It'll make life a little easier for Australian households," he said.
Mr Costello says it is up to householders to decide what to do with the extra money.
"I think people know if they've got a little bit of extra money in their pocket they can meet their bills, put some aside," he said.
"I hope this will be wisely spent by families, by others and I hope that households are able to remain confident because that's important for the growth of the economy."
-abc.net.au
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ATO outline targets for 2006-07 tax year
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| Posted by admin on Wednesday, June 27 @ 05:24:44 SGT (155 reads) |
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People who've invested large sums in superannuation, mining workers and personal trainers will be among the Australians whose tax returns will face extra scrutiny this year.
As the 2006-07 financial year rolls to a close, the Australian Taxation Office (ATO) is reminding individuals to pay attention to details when they're filling in their returns.
Last year, 10,000 people had their refunds delayed because they forgot to sign their return.
One of the biggest mistakes taxpayers make is claiming deductions not related to the generation of their income.
Jennie Granger, the ATO's second commissioner of compliance, reminded people to make sure "work expenses are relevant to your job".
The ATO will be paying particular attention to big superannuation contributions which take advantage of changes to the legislation, which come into effect on July 1.
Before June 30 people can contribute up to $1 million to their superannuation, while the limit will change to $150,000 per annum from July 1.
Ms Granger said if people were selling assets to boost their superannuation before the end of the financial year they needed to factor in any capital gains they made.
"They need to think about where that money came from and whether it's something for their tax return," she said.
"If you borrowed money, the interest is not tax deductible."
Ms Granger warned that the ATO would receive contributions statements from superannuation funds later this year and would cross-match them with tax returns.
"If we see a very big contribution and we can't see how that's funded, we'll be giving you a call," she said.
Workers on mine sites, and in the tourism and travel, construction, security, sporting and fitness industries will be among those whose returns will face extra scrutiny.
Each year, the ATO chooses a number of industry groups which receive extra attention when returns are filed.
In industries such as mining, where boom times were creating sizeable incomes for some people, Ms Granger urged them to think twice if they were given advice that seemed too good to be true on how to invest their surplus cash.
"Be wary of people offering investments that rely on big tax deductions," she said.
"If it looks too good to be true, it probably is ... go and get independent advice or check with us."
When looking at returns from these industry groups, the ATO will focus on a variety of areas including travel expenses, equipment claims and self-education expenses.
-AAP-ninemsn.com.au
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New laws to cut GST red tape
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| Posted by admin on Tuesday, June 19 @ 08:20:54 SGT (170 reads) |
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Many small businesses will be able to complete their paper work more simply under a government bill which passed the House of Representatives.
An amendment to GST law will allow small businesses with a turnover of less than $2 million a year and which use a mixture of taxable and tax-free supplies to adopt a simpler accounting system which should cut their costs.
The system has previously been available only to food stores and charities.
The system allows businesses to apply a ratio rather than having to identify the GST status of every input.
In introducing the measure, Revenue Minister Peter Dutton said businesses that should benefit included goods and services exporters, optometrists, retirement village operators, child care operators, chemists, travel agents, medical appliance suppliers and health supplement shops.
Labor supported the measure.
Assistant treasury spokesman Chris Bowen said the government had waited until an election year before adopting a version of Labor's simplified accounting system and claiming it as its own.
The bill now goes to the Senate.
-AAP-ninemsn.com.au
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New tax code could force up accountancy costs
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| Posted by admin on Monday, June 18 @ 06:20:21 SGT (179 reads) |
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The Taxation Institute of Australia (TIA) says new legislation proposing a code of conduct for tax agents could significantly increase the cost of using an accountant and lead to lengthy and costly audits.
The code would require tax agents to double-check client details to determine the true state of their tax affairs, even if the client has provided all the relevant details in an open and honest manner.
TIA senior tax counsel Michael Dirkis says the lengthy process could raise costs so much that some small businesses may have to forego independent tax advice.
"Potentially the cost could be quite high and in some cases, it would have the impact of pricing clients out of the market," he said.
"The reality is a lot of clients would be unhappy to hear that their work has to be double-checked and would see it as an unnecessary cost."
Mr Dirkis says being forced to re-examine the files of a client who has been open and honest in their affairs would be a waste of time and money.
"The problem with the way the code is currently written is that it will require an agent to double-check their clients' affairs, even though there is no suspicion that the client has acted in any way wrongly, or that there's any problem or process problem with the way they've arrived at their accounts," he said.
-abc.net.au
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Small businesses have huge unpaid taxes
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| Posted by admin on Tuesday, June 12 @ 06:29:57 SGT (168 reads) |
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A big chunk of nearly $19 billion worth of taxes owed to the Australian Tax Office (ATO) last financial year was due from businesses with an annual turnover of less that $2 million.
The Australian National Audit Office (ANAO) says taxation debt is becoming a growing problem, particularly from what it terms as micro-businesses, but still Australia ranks highly compared with other countries in collecting outstanding taxes.
As at June 30, 2006, the ATO collected $232.6 billion in taxes, but total taxation debt was $18.78 billion, an ANAO report released Tuesday shows.
Over half, or $10.23 billion, is classified at collectable, where the debt is due and not the result of a dispute or that the entity being insolvent.
Collectable debt as a percentage of revenue collections has risen over the course of the last 10 years.
As a percentage of collected tax it was 2.7 per cent in 1995-96, 3.7 per cent in 2002-03 and 4.4 per cent in 2005-06.
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