A carry back loss provision in Australia similar to US provisions would help preserve businesses and jobs, according to Deloitte tax partner Craig Holland.
A statement from Deloitte said should the Government allow a similar provision in Australia, it would throw a lifeline to struggling businesses by providing them with a quick injection of cash.
In the US, small businesses with deductions exceeding their income in 2008 can now use a net operating loss tax provision to get a refund of taxes paid in prior years. The carry back provisions previously applied to two years but have recently been extended to five years, the statement said.
“While the issue of carry backs has been raised before, it needs to be brought to the forefront of discussion again given its importance as an effective way of assisting struggling businesses in the current economic climate,” Holland said.
