Nick Connell, Taxation Manager of the National Tax & Accountants Association has expressed concerns about recent reports pre-empting what may be in the Henry Review of Australia’s taxation system.
Is not convinced that those aspects of the Henry proposal that have been leaked will simplify the tax system for the benefit of Australian taxpayers.
Softening up taxpayers
He says that the NTAA is concerned that, rather than having an open and robust public discussion, the Henry
Review of the taxation system seems to have entered the phase of softening up the Australian
taxpayer.
It’s an old tactic. Leak a part of the story, wait for a response then pounce. Dr Henry
has already started flexing his muscles by saying that he is fully prepared for “scare campaigns”.
So, presumably, any unfavourable response will be labeled a scare campaign. A little harsh given the
fact that he has chosen to only release a tidbit and not release the whole document.
That said, the Henry proposal, to be released in December, is expected to recommend that taxpayers
will receive a one-page summary “income tax return” which will include a “standard” deduction for work
related expenses. Taxpayers will be able to ‘tick’ a 1 page document issued by the ATO and sit back
and wait for their refund.
The refund will be based on a ‘standard’ deduction for work related expenses and a figure of $500 has
been floated. (
Now taxpayers have a right to be scared!
Nick Connell, spokesperson for the NTAA said that “Treasury has for years been concerned at the
blow-out in work-related deductions and we believe that the concept of a ‘standard’ deduction may
well be the first step in controlling deductions for work-related expenditure.”
“We are concerned, and we believe justifiably concerned, that if taxpayers allow their claims for
work-related expenses to be “standardised” in any form at all, that they may end up losing them.”
“Millions of taxpayers are entitled to legitimately claim hundreds or thousands of dollars in
deductions that they incur in earning their income. This right is written into the law.”
“Most of us make claims for car expenses, travel and accommodation, home office, uniform,
protective clothing, laundry, telephone, computer, power, etc. The list goes on.”
“How long will these claims last,” he asked, “once we allow them to be standardised?”
Is the end-game the abolition of tax refunds?
“Australians love their income tax refunds. They rely on them as a, sort of, forced way of saving.
They are an institution and it is our right to be able to claim work-related deductions and receive
income tax refunds.
We urge taxpayers to not allow the government to standardise deductions that they are legally
entitled to. Make no mistake about it. Let them get their foot in the door and the refunds we love
to get will one day be wiped out.”
Leaking a tidbit from the proposals raises more questions than answers and the NTAA calls on Dr Henry
to have an open dialogue with the Australian people and not seemingly engage in a surreptitious
campaign to gauge public reaction.
From NTAA
To put the $500 standard deduction in perspective , most union members pay more than this in annual fees. The average amount of work related deductions claimed is $1,920. –SH