Hayley Lock, Andy Larmour & Graeme Hartnett discuss why employers should consider these proposed changes before developing remuneration policies.
The Productivity Commission released its draft report on Remote Area Tax Concessions and Payments on Wednesday. According to the Federal Government, this was “in response to concerns raised that the current remote tax assistance has failed to keep pace with a changing Australia”.
While the report also provides recommendations on the Zone Tax Offset and the Remote Area Allowance, the key recommendations for employers relate to Fringe Benefits Tax. In particular, the Commission’s view is that current FBT remote area concessions are overly generous and complex, thus creating inequalities. In addition, the Commission noted that many participants expressed the view that, while concessions were important for regional development, the FBT concessions are not currently suited for that purpose.
Broadly, the Commission (in draft) has recommended the following key changes:
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