ATO puts an end to 'unfair' tax advantage for workers camp
THE Australian Taxation Office has put an end to an "unfair" tax advantage at a Calliope workers camp.
Since it opened in 2011 to relieve housing pressure during the construction of Curtis Island LNG plants, Calliope Homeground Village has been classified as being located within a "remote" area.
The classification has caused a stir among Labor politicians and hoteliers in Gladstone who argued it gave the business an advantage over other accommodation providers. Labor candidate for Flynn Zac Beers said it meant employers who housed workers there wrongly received an exemption to the Fringe Benefit Tax.
But this week the Australian Taxation Office confirmed a review of the matter found Calliope had been incorrectly listed as remote.
Under the legislation, an employer has to pay the Fringe Benefit Tax if the location of the accommodation is within 40 kilometres of a city the size of Gladstone.
Employers pay the tax on accommodation and food for their employees at a rate of 49%.
But the classification gives employers an exemption from this tax.
Mr Beers said the decision to classify Calliope as "non remote" would have a "real and positive impact" on the Gladstone workforce.
"The ATO has now firmly shut the lid on an unfair loophole being exploited for profit at the expense of the Gladstone community," Mr Beers said.
Opposition Leader Bill Shorten said it was a "win for commonsense".
Asked how the decision would impact his business, Homeground Villages business development manager Matt Jones said the FBT tax law was a "complex matter".
He said if Homeground ever received an advantage it was a matter for the ATO.
Mr Jones defended the accommodation provider and said since opening it had worked hard to be part of the region.
"We actively support and promote local events... You don't have to go far to see our logo on a jersey or shirt," he said.
The Observer understands that Homeground was classed as a remote area despite it being within the 40km zone because the road network used to calculate the distance was based on data from July, 1986.
A letter from the ATO to Labor Senator Chris Ketter and Member for Fenner Andrew Leigh said a review found Calliope was "incorrectly" classified as remote.