The Institute of Public Accountants (IPA) has listed genuine tax reform and a revisiting of the complexities of the capital gains tax (CGT) structure as top of its list of pre-budget priorities.
The Henry Review advocated for the simplification of most of the provisions of the CGT and the impacts for the economy in terms of providing stimulus for investors and affordable housing options are significant, according to IPA chief executive Andrew Conway.
“It’s fair to say the accounting profession and our members are getting anxious to see actual traction [in terms of the Henry Review and tax summit], it’s been a long time coming,” Conway said,
The IPA would also like to see a commitment to the continual review of state and territory taxation with a view to improving efficiencies for the economy by reducing the regulatory burden on small business, he said.
The IPA will also be advocating three marginal tax rates of 15 per cent, 30 per cent and 40 per cent. This is not based on detailed economic modelling, Conway said, but broad discussion is required around marginal tax rates compared to other OECD nations and other markets in our region.
Australia is striving to become a financial services hub but Singapore has a significant advantage over Australia in terms of its marginal tax rates, leading to talent drain from Australia, Conway said.
The IPA also advocated for the establishment of the office of a small business advocate.
“We think it is absolutely critical to have a Federal office responsible for representing the interests of small business,” Conway said.
“The voice to Government is critical, there are too many disparate voices of small business,” he said.
In terms of superannuation the IPA adding its voice to the chorus calling for a review of the problematic concessional contributions caps. Conway also said it was time to think of introducing a thoroughly simplified superannuation model where super was linked to a bank account, enabling people to view their super balance through their bank, increasing transparency and engagement.
