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Institute welcomes legislation making tax compliance easier for small business
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The Institute of Chartered Accountants in Australia, welcomes the Federal Government’s new legislation to standardise the eligibility criteria for small business tax concessions from July 2007.  
 
The legislation, announced today, involves a number of measures including:  

  • The consolidation and simplification of the ‘definition’ of a small business within income tax;
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  • Any business with an annual turnover of less than $2 million will be able to access small business concessions and
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  • Small businesses will only have to apply for one eligibility test to access small business concessions
 
Tax Counsel for the Institute, Ali Noroozi said the measures would improve access to tax concessions and reduce compliance costs, which will also have flow-on benefits. 
 
“Small business is critical to Australia’s growth as it accounts for almost half of the employment and around a third of Australia’s economic activity. It is great to see the Government addressing some of the concerns around the complexity of the current tax system and associated compliance costs,” Mr Noroozi said. 
 
“The Institute has long advocated for these measures and earlier this year released a thought leadership Paper: Research and recommendations on definition of small business, with the aim of addressing tax complexities, compliance burdens and other red tape issues strangling small businesses,” he said. 
 
The report focused on a key aspect of increasing simplicity in relation to small business tax concessions - improving access and reducing compliance costs through consolidating and simplifying the definition of small business, to the maximum realistic extent, in Australia’s income tax (including capital gains tax (CGT), fringe benefits tax (FBT) and goods and services tax (GST) legislation.  
 
“Whilst the new legislation delivers some very significant measures, the Institute will continue to lobby for further concessions for small business as part of its 2007 / 2008 Pre-Budget Submission,” Mr Noroozi said. 
 
“The Institute looks forward to seeing the detail of the legislation and working with Government and its agencies on the implementation, to ensure that the desired outcome is achieved,” he said. 
 
The Institute’s thought leadership report is available upon request or by visiting www.charteredaccountants.com.au