Fixing inconsistencies a great place to start tax review
AS I write there are mercifully just two days to go to the election which is expected to introduce us to an Abbot-led government with a big majority.
Like most people I know, I have filtered out most of the crap that emanated from pollies' mouths in the lead-up to Saturday and have looked for something promised that might be game-changing for Australia and Australians.
What I came up with is Abbott's commitment to tax reform, something he doesn't need a "great big" expensive enquiry like the largely ignored Henry Review to achieve.
All he needs to get things started this very week is a junior public servant who can read and write. That guy or girl should be told to concentrate on inconsistencies between one part of the body of tax legislation and others.
Why not start with receipts? The GST Act and Income Tax Act (in its various manifestations) are separate beasties.
But they're part of the same body of federal law passed by the one parliament, administered by the same public service department and subject to the often mystifying interpretation of the same judicial wigs.
So why is it that you as an individual taxpayer need a receipt for a deductible purchase of $2 under the Income Tax Act and a business need not collect a receipt for a purchase under $75 under the GST Act?
It's an inconsistency that fairly rankles… and it's something that could be rectified by a junior before morning tea tomorrow, passed through parliament by afternoon tea and gazetted before pollies rise for nibbles and chardy.
That's what a well-run business could and would achieve.
Then there are the inconsistencies between the Fringe Benefits Act and the Income Tax Act in its various manifestations - even before Kevin Rudd put a sword through novated leasing and by implication, the Australian car industry.
Have a look at the disparate treatment of LAHA for rotational workers under the FBT and Tax Act, as interpreted (butchered?) by the judiciary.
Judges make law on the run, but the Parliament can overrule precedent by clarifying and providing consistency in good legislation.
And there's much, much more!
Bob Lamont is Director of Corporate Accountants situated at the Night Owl centre, Gladstone. Contact him on 0411 245 827, 1300 450 810 or at firstname.lastname@example.org