The Australian government is looking to boost the country’s struggling shipping industry by introducing major tax breaks and setting up an international shipping register. The announcement was made by Transport Minister Anthony Albanese who said that the reforms would be “the most far-reaching overhaul of our shipping industry ever undertaken.”
It is estimated that 10% of global sea trade is handled in Australian ports, however only 0.5% of that trade is carried by Australian-flagged ships. Australian-flagged companies are those that are incorporated in Australia or are managed and controlled in Australia with Australian shareholders.
The tax break would allow Australian-flagged operators to be exempted from corporate income tax, when operating around the Australian coast and internationally. To qualify for the tax break the ships will have to remain registered in the country for 10 years.
Other proposed changes on the tax front include roll-over relief for selected capital assets, tax exemptions for seafarers working overseas on qualifying vessels, a Royalty Withholding Tax exemption where vessels are leased by an Australian company from foreign owners under a demise or bareboat charter and cutting the depreciation period from 20 years to 10 years.
“A revitalised Australian shipping industry will increase the national return from the resources boom,” said Mr Albanese.
Maritime Union of Australia (MUA) National Secretary Paddy Crumlin said: “Mr Albanese should be congratulated for putting this important nation building issue on the agenda.”
“The MUA welcomes shipping reform as one of the greatest policy developments in Australian shipping since the Navigation Act was introduced in 1912.”
“It recognizes the importance of Australia as the fourth largest shipping nation by volume and the numbers are increasing with the mineral resources boom.”
“We have long been one of the world’s largest shipping nations but we lost critical momentum in this vital industry during the Howard years.”
“The new policy restores fairness and transparency to the way shipping participates in the domestic freight market, while greatly increasing the potential for green field opportunities for Australian businesses to participate in international shipping.”
.Tags: tax | trade | business | marine | employees | corporation tax | withholding tax | individual income tax | Australia | tax breaks | Australia
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