AUSTRALIAN SMALL BUSINESS WHITE PAPER: TAX REFORM A KEY

Australian Small Business White Paper: tax reform a key

After more than 18 months of extensive research and consultation, the Institute of Public Accountants (IPA) and the IPA Deakin SME Research Centre have released the second edition of the Australian Small Business White Paper.

“Numerous policy recommendations have been adopted from the first edition which was launched in 2015. However, we recognise that the state of our economy is reliant on the productivity, growth and prosperity of the small business sector so this work must be ongoing”, said IPA chief executive officer Professor Andrew Conway.

The White Paper covers a range of topics, including productivity, regulation, taxation, SME financial markets and workplace relations. On taxation, it makes several recommendations:

•       Broaden the base and lift the rate of GST (subject to appropriate equity measures).

•       Cut direct taxes.

•       Undertake a zero-base design of a thoroughly modern taxation system.

•       Reform and simplify the personal income tax scale.

•       Standardise the company tax rate at 25%.

It also poses a number of thought-provoking questions, including:

•       What would it look like if Australia’s GST rate rose to 15% and personal income taxes were slashed or removed for a new entrepreneur’s first five years in business?

•       What does a tax system look like that rewards rather than punishes people under the age of 50 for saving for their retirement?

•       Why do we have excess contributions taxes for those wanting to remove the burden from the state in their retirement?

•       What about a tax rate that applied a tax-free threshold at $30,000 per annum and 15% for minimum wage earners?

If you would like to know more please contact one of our accountants on 07 4639 1099 or come in and see us at 14 Russell Street Toowoomba.