One of the benefits of being president is that you get to go to extremely good Tax Institute conventions at marvellous venues. In May, I attended the Queensland Division’s Private Business Retreat, held on the Gold Coast, and then the South Australian State Convention in the Barossa Valley. Both had excellent programs with great presenters and were thoroughly enjoyed by all delegates.
The Queensland event was focused on changing businesses from trusts to company structures and featured very valuable workshops. The Palazzo Versace venue made just being there highly enjoyable notwithstanding the bucketing rain), but I blanched at the cost of the beautiful Versace cup and saucer desired by my wife.
Tell us a little about yourself, how long have you been in practice now?
I have been practicing almost exclusively with respect to SMSF’s for close to 11 years now. A lot has changed over that time. I became a member of The Tax Institute in 2006. I studied at the University of Western Australia, obtaining a Bachelor of Commerce, and once I started working in the industry, completed additional study in the relevant areas.
This is your fifth year of presenting our Superannuation Roadshows, how did you find it this time out?
There are always changes occurring with respect to superannuation that we need to be aware of, with the practicalities of the implementation of strategies being big areas of concern this year. The format change of the Roadshow to include several workshop case studies hopefully provided a more hands-on approach for practitioners. It was also a benefit that my luggage wasn’t lost on my way to Darwin, like it was last year.
The last quarter has been filled with movements on the tax front, largely owing to changes announced in the Budget, ongoing developments in relation to previously announced changes (such as Part IVA and transfer pricing reform) and more recently announced Board of Taxation reviews into problematic areas, such as a review of Division 7A and separate entity treatment for permanent establishments.
These announcements represent a mixed bag for our members. The Budget announcements winding back many of the previously announced tax reforms following the release of the Henry review such as the introduction of the standard deduction and a cut in the company tax rate represented a disappointing step away from important tax reform measures. Conversely, the Government’s announcement of the introduction of a limited carry-back of revenue losses is broadly a step in the right direction that will assist thousands of small to medium enterprises in tough economic circumstances.
Last week The Tax Institute called on the Federal Government to recommit to the fundamentally important area of trust tax reform, given the recent months of apparent inaction.
As members are only too aware, the ongoing uncertainty around trust taxation is one of the top reform issues and the lack of a clear reform timeline is unacceptable.
The Government had originally committed to release its policy design paper last month. This hasn't happened, so with the reforms obviously requiring more time, the lack of an announced revised timeline is creating greater uncertainty over a complex, cumbersome and critically out-of-date area of the tax system.
In light of Treasury’s resource-constraints, it is disappointing to see the apparent lack of focus on a reform that will assist taxpayers by reducing their compliance burden.
"According to their own timeline, the Government had committed to release its policy design paper by May this year.
"Instead the process is already behind schedule creating greater uncertainty over a complex, cumbersome and critically out-of-date area of the tax system.
"Since the release of the initial Consultation Paper in November 2011, the reform has largely stalled to the detriment of a significant number of taxpayers dealing with ongoing complexity and uncertainty."
Early last week the House of Representatives Standing Committee on Economics inquired into the Bill containing the retrospective changes to TOFA and the consolidation rights to future income rules.
The Tax Institute was the only professional association to take the fight against retrospectivity to the Committee in the form of a detailed submission. We were also the only witnesses (with Treasury) called to present evidence in person to the Committee.
A big thank you to both Peter Murray FTI (Life) (KPMG) and Andrew Hirst FTI (Greenwoods & Freehills) who joined me at the Committee hearing and lent their expert knowledge. Please refer to Hansard for the draft transcript of the hearing. The Committee will table its report including recommendations concerning the future of the Bill on 18 June and I will keep members updated.