The Board of Taxation is a non-statutory advisory body charged with contributing a business and broader community perspective to improving the design of taxation laws and their operation.
Ideas for better tax regulation
FBT, GST and Uber travel.
The recent Federal Court case on the GST treatment of Ubers decided to adopt a common sense definition of taxi and thus have the same GST rules apply to taxi and Uber travel. However the FBT law defines a taxi as a "motor vehicle that is licensed to operate as a taxi". It would seem therefore on a literal reading of the FBT law, that the exemption given to certain taxi related travel given to employees does not apply if your staff catch an Uber rather than taxi as Ubers aren't licensed to operate as a taxi. Seems an unintended consequence that you have to pay FBT on certain Uber travel, but no FBT when you use a taxi. The FBT law was written in 1986, some thirty years ago, and needs updating. A common definition of taxi across all tax laws seems needed.
New Project Contribution/ levy
Would the board consider making recommendations to the government to introduce a voluntary tax levy (administered through the tax system) whereby the average Australian is offered an option to contribute towards a project ( could be a long term infrastructure project like high speed rail) and get a tax deduction for it. The revenue generated will go into a fund specific for that project. The average Australian will feel empowered when such projects contribute to jobs and growth in their communities. The government will then be required to consider these projects and implement them based on the tax base support for the project.
Main residence CGT special market value rule should be a choice
Section 118-192 of ITAA97 provides a special rule under which a main residence (if acquired after 20/8/96) is deemed to have been acquired at market value when it is first used to produce assessable income. Too many taxpayers don't get the valuation at the time (eg. because they thought they were going overseas for max 6 years so could use the absence choice, but ended up staying for 10 years) and there is no guidance on how do they then calculate their gain on disposal without that valuation. The ATO website (QC 17185) avoids the issue by giving an example of a property purchased prior to 21/8/96. Another page (QC 17193) gives great examples of taxpayers getting valuations on the assumption that they knew of this rule when first moving out and states that use of the special rule is compulsory. Why not make this special rule an alternative rule to the normal CGT calculation (proceeds less actual cost base, apportioned for the income producing period)? I cannot imagine that this would be a cost to the revenue. Rather it would be an aid to taxpayer compliance.
Meetings & events
- 8 Dec 2016 - Board of Taxation Meeting in Melbourne
- 11 Nov 2016 - Board of Taxation Meeting in Canberra
- 11 Oct 2016 - Board of Taxation Meeting in Perth