Australia Announces New Tax Working Group

by Mary Swire, Tax-News.com, Hong Kong

17 October 2011

The Australian Treasurer Wayne Swan has announced the terms of reference and appointments to a new tax working group. The group will look at reforms that could increase productivity and deliver tax relief to struggling businesses and develop a set of savings options within business tax, such as broadening the base and addressing loopholes or unnecessary concessions.

“Dealing with the challenges of an economy where different sectors are growing at different speeds has been central to our tax reform agenda both in terms of what we have done so far and what we need to do next,” said Wayne Swan, Treasurer.

The group will focus on reform options that relieve the taxation of new investment in the near term, by looking at changes to the tax treatment of business losses; and in the longer term, by looking at options like reducing the corporate tax rate further or alternatives such as allowances for corporate equity. It will also be required to identify options to fund any proposals from within the business tax system. Changes to the Goods and Services Tax are not to be considered by the group.

In developing its recommendations, the group has to take into consideration the report of the Australia’s Future Tax System Review as well as relevant international experience and expertise.

It is required to provide the Treasurer with an initial report on the proposed directions for improving the tax treatment of losses and offsetting savings in mid-November 2011; a final report on the treatment of losses and the offsetting savings in March 2012; and
 a further report on longer-term business tax reform options and offsetting savings by the end of 2012.


The group will be chaired by Chris Jordan, Chairman of the
 Board of Taxation, and its members will include: Jennifer Westacott, 
Chief Executive of the
 Business Council of Australia; Jeff Lawrence, 
Secretary of the 
Australian Council of Trade Unions; Rob McLeod, 
CEO of
Ernst & Young; Teresa Dyson,
 Chair of the Taxation Committee, Business Law Section, 
Law Council of Australia; Peter Burn, Director of Public Policy, Australian Industry Group; Frank Drenth,
 Executive Director of the 
Corporate Tax Association of Australia; John Freebairn, Professor of Economics at the University of Melbourne; and Rob Heferen,
 Executive Director of the Revenue Group at the Treasury.

“The tax system will continue to play a critical role in helping our economy adjust to change and spreading the benefits of the mining boom to all corners of our patchwork economy,” said the Treasurer.

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