THE Standing Committee on Tax and Revenue has recommended that the present arrangements of the external scrutiny of the Australian Taxation Office (ATO) should remain in place in its report tabled today.

Chair the Committee, Bert van Manen MP, said its inquiry into the external scrutiny of the ATO examined the roles of its main scrutineers – the Australian National Audit Office (ANAO), the Inspector-General of Taxation and parliamentary committees.

“The ATO has considerable resources and powers, which are necessary to administer the tax system, but their use also needs to be monitored,” said Mr van Manen.

“Taxpayers receive a great deal of comfort from knowing the ATO is subject to high quality external scrutiny and we have recommended that the present arrangements should continue.”

Mr van Manen said that complaints about tax administration were transferred from the Commonwealth Ombudsman to the Inspector-General in May 2015.

“The Committee supports the Inspector-General’s mandate and found that the Inspector-General plays an important role in scrutinising the ATO and is highly regarded by taxpayers and tax practitioners,” he said.

Mr van Manen said another key issue in the inquiry was the extent of overlap between the work of the ANAO and the Inspector-General.

“The Committee found that the extent of any duplication, if it does occur, is minimal,” he said.

The Committee also considered communication between the Inspector-General and the ATO and recommended that the Inspector-General and the ATO increase efforts to communicate effectively.

There are opportunities for improvement in how the scrutineers operate. The Committee’s other recommendations were that:

• the scrutineers increase the transparency of how they co-ordinate their work
• the scrutineers better explain in their reports how each review fits in with other reviews
• the Inspector-General consider how to conduct reviews based on complaints and emerging issues in tax administration
• in the next Parliament, the Committee scrutinise the work of the Inspector-General, similar to how the Committee scrutinises the work of the ATO.

For information about the inquiry: please contact the committee secretariat by telephone (02) 6277 4821, e-mail This email address is being protected from spambots. You need JavaScript enabled to view it., or visit the committee website www.aph.gov.au/taxrev

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THE Australian Parliament’s Trade and Investment Growth Committee has released its report entitled Inquiry into Australia’s Future in Research and Innovation.

The Inquiry examined Australia’s innovation system from the creation of ideas through research and innovative thinking, to the commercialisation of these ideas.

The Chair of the Committee, Mr Ken O’Dowd MP said, “Australia faces a world of rapid change as technology creates new products, new processes, and new industries. New innovative companies are expected to significantly contribute to Australia’s economy and assist in its diversification, increasing employment and improving its global competitiveness.”

“New innovative businesses need to be flexible and globally focussed from the outset. For them, it is no longer the case that the big will consume the small—instead, the fast will surpass the slow.” Mr O’Dowd said.

The report made six recommendations:

• Emerging industries should be identified where strategic research investment could enable Australia to become a world leader.
• There should be a review of overseas models of university-business collaboration to identify strategies which could be introduced in Australia.
• Initiatives introduced as part of the National Innovation and Science Agenda should be reviewed after three years of operation to determine their effectiveness and whether the programs should be expanded.
• If a patent box scheme is introduced, it should be subject to a sunset clause after three years of operation, in addition to a review.
• The Manufacturing Finance Corporation proposal should be reviewed.
• The Advanced Manufacturing Tax proposal should be reviewed.

The report is available from the Committee’s website.

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PARLIAMENT'S Public Accounts Committee today tabled its report into the 2014‑15 Major Projects Report produced by Australian National Audit Office (ANAO) and Defence.

The Major Projects Report consolidates information on major Defence acquisition projects—including cost, schedule, and capability performance. It also provides a longitudinal analysis of projects and commentary on Defence’s project governance systems.

“The Major Projects Report has developed into an excellent tool to assess the status of Defence major acquisition projects” Committee Chair, Mr Ian Macfarlane MP said.

“However, despite some significant capabilities being delivered in recent years, the Committee remains concerned that slippage of projects continues and believes it is critical that Defence correctly assess the project type early in the procurement cycle—be it ‘off the shelf’ or developmental.”

“The Committee was strongly concerned with the contracting model for the Air Warfare Destroyer project—making a recommendation that Defence undertake a detailed review to determine liability for the project’s problems and to help mitigate similar issues arising in the future.”

“The Major Projects Report is a key tool to improve the transparency of Defence procurement. Recent reforms of Defence represent an opportunity to further improve the Report and Defence procurement outcomes—but ongoing commitment, resourcing and leadership will be required. The Committee commends Defence and the ANAO for their strong efforts in this regard.”

The JCPAA’s report can be found at the Committee’s website http://www.aph.gov.au/jcpaa.

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TWO NEW initiatives designed to make investment in Australian start-ups more attractive will be in place for the 2016-17 financial year after passing the Senate.

Minister for Industry, Innovation and Science Christopher Pyne said the measures were part of the government’s National Innovation and Science Agenda, which would drive smart ideas that create business growth, local jobs and global success.

“These tax measures are designed to broaden and diversify the economy through economic policies that build growth and productivity,” Mr Pyne said.

“The Tax Incentive for Early Stage Investors and New Arrangements for Venture Capital Limited Partnerships will promote investment in innovative high-growth potential start-up companies and improve businesses’ access to venture capital.

“Over 4,500 startups are missing out on equity finance each year. These measures will help startups get access to crucial funding to grow their startup.

“Investors, venture capital funds and innovative companies in all industries will benefit from these measures,” he said. 

The Tax Incentive for Early Stage Investors gives tax concessions to eligible early stage investors who invest in qualifying companies. The concessions include a capped 20 percent non-refundable tax offset and 10 year capital gains tax exemption for investments.

The New Arrangements for Venture Capital Limited Partnerships provide a range of changes that will improve access to capital and make investing in venture capital more user-friendly and internationally competitive.

www.innovation.gov.au.

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THE impact of the Road Safety Remuneration Tribunal’s (RSRT) Payments Order on small business owner-truck drivers will be investigated by the Australian Small Business and Family Enterprise Ombudsman (ASBFEO).

As set out under section 42(1) of the Australian Small Business and Family Enterprise Ombudsman Act 2015, the Federal Government on Friday requested the ASBFEO conduct the inquiry; the first to be undertaken by Kate Carnell in her role as Ombudsman.

The investigation will examine the overall effect of the RSRT’s Payments Order on owner-driver businesses, taking into account the period before and after its implementation and subsequent cessation.  The inquiry will also consider the role small businesses can play in the development and operation of tribunals and other similar bodies.

“The anecdotal evidence we’re hearing of the financial difficulties small businesses continue to face as a result of the Payments Order is extremely concerning, so a formal investigation into the extent of the impact is certainly warranted,” Ms Carnell said.

Ms Carnell said the inquiry will consult broadly with stakeholders to establish exactly how widespread situations of financial hardship are across the sector.

“Some owner-drivers are saying the battle to stay afloat has only just begun, as they struggle to stay on the road and try and re-coup the income they were forced to forgo during the weeks of uncertainty triggered by the RSRT, so we’ll be looking for feedback to determine just how prevalent these sorts of cases are,” Ms Carnell said.

Ms Carnell said she is particularly interested in hearing from small businesses who have been subjected to heavy-handed practices from creditors.

“I’ve been made aware of instances whereby people have resorted to borrowing money from family members in order to stay on top of their payments,” Ms Carnell said.

“I once again encourage all creditors, including suppliers, banks and other financial institutions, to show some leniency towards owner-driver small businesspeople who may be struggling financially due to the recent upheaval,” she said.

Further particulars on the inquiry including submission details and reporting dates will be announced shortly. 

In the interim, small businesses can contact the ASBFEO on 1300 650 460 or by visiting the website: www.asbfeo.gov.au

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THE House of Representatives Environment Committee today presented its report into the Register of Environmental Organisations, a government scheme that enables eligible environmental organisations to receive tax-deductible donations.

The report centres on the administration of the Register, and how the Register supports communities to take practical action to improve the environment. The Committee has identified some key areas of possible reform of the Register, including measures relating to:

• the operation of the Register;
• activities undertaken by organisations listed on the Register; and
• the integrity of the current regulatory framework for registered organisations.

The Committee acknowledges the high level of public interest in the inquiry, having received over 685 submissions and a significant volume of correspondence. A substantial portion of this evidence originated from organisations currently listed on the Register. In recognition of this strong interest in the inquiry, the Committee undertook an extensive program of public hearings and site inspections around Australia, to hear firsthand about the range of environmental work being supported by the Register.

The Committee’s report is accompanied by a dissenting report from the Labor members of the Committee, and additional comments from the Member for La Trobe, Mr Jason Wood MP.

A full copy of the Committee’s report can be found on the inquiry’s website 

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THE Victoria Tourism Industry Council (VTIC) welcomes investments in the visitor economy made by the Andrews Labor government in the 2016-17 State Budget.

VTIC is pleased to see the government follow through with significant funding allocations which align with our pre-budget submission priorities - increased visitor spending in regional Victoria, and investing in tourism assets across the state.

VTIC Chief Executive Dianne Smith said, “The benefit of drawing more international visitors to regional Victoria is huge. The Regional Tourism Infrastructure Fund and the Regional Events Fund will boost the tourism offerings across the state, encourage visitation and help create jobs in regional Victoria.”

"It would be great to see every international visitor to Melbourne going to our regions as well.”

The visitor economy currently contributes $19.6 billion to the Victorian economy and employs more than 200,000 people. With the right settings, this could grow to $34 billion and 310,000 jobs by 2020.

“Increasing the payroll tax threshold will ease the cost of doing business for the thousands of small and medium businesses in our sector. This will help the industry grow and help meet these ambitious targets,” said Ms. Smith.

Some of the key tourism investments included in the state budget are:

• $101 million Regional Tourism Infrastructure Fund, including $48.2 million for the redevelopment of the Penguin Parade Visitor Centre at Phillip Island Nature Parks;  
• $38 million over 2 years for Visit Victoria Marketing;
• $20 million over 4 years for a Regional Events Fund;
• $9 million over 2 years for Business Events;
• $66 million for the Victorian Government Business Office network, with 18 offices around the world, including five in China, as part of Victoria’s China Strategy; and
• $8 million for the Gundij Mirring Traditional Owners to implement stages one and two of the Budj Bim Master Plan, which will open this natural heritage landscape to all visitors and strengthen a bid for the national heritage landscape to receive UNESCO World Heritage listing.

The visitor economy will also benefit from the $115 million investment in the Creative State, which includes:

• $7 million to support a cultural hub for Bendigo;
• $23 million to expand and upgrade the state’s cultural collections storage, including a new facility in Ballarat;
• $50 million boost for the State Library of Victoria, Arts Centre Melbourne and Melbourne Recital Centre; and
• $14.2 million for the screen industry, including funding for the Melbourne International Film Festival

Getting around Melbourne and Victoria will also be made easier with $1.3 billion allocated to improve regional rail services and $134 million for a safety upgrade to the City Loop.

As well as giving the sector a good confidence boost, VTIC is pleased that the government has delivered some tax relief to the thousands of small businesses that contribute to the visitor economy.

VTIC will continue to advocate for strategic investment in the sector and more practical measures that lower business costs and help realise the significant jobs potential of the tourism and events industry in this state.

The Victoria Tourism Industry Council (VTIC) is the peak body for Victoria’s tourism and events industry, providing one united industry voice.

Tourism and events are growth industries for Victoria and contribute more than $20 billion to the state economy each year and employ more than 200,000 people.

vtic.com.au  

THE Joint Standing Committee on Treaties  last week tabled two reports, with the first focussing on treaty activity regarding fisheries, marine safety and taxation, while the second summarised material from the recent seminar marking 20 years of the Committee’s work.

Committee Chair Luke Hartsuyker MP said the first report recommended ratification of an agreement designed to strengthen the Niue Treaty on fisheries surveillance and law enforcement in the South Pacific.

“The treaty will provide another avenue for preventing illegal, unreported and unregulated (IUU) fishing in the region, which depletes fish stocks through overfishing and poses a serious threat to food security in our region,” Mr Hartsuyker said.

“Australia plays a key role in maritime surveillance in the region and is committed to supporting regional cooperation on maritime security. This agreement will help us to maximise our operational reach and effectiveness in monitoring illegal activity, such as IUU fishing.”

Mr Hartsuyker said the report also included two new International Maritime Organization codes which will improve ship safety and protect the marine environment.

“The Polar Water Code will ensure that ships operating in polar waters are built to withstand the conditions, while the IGF Code will provide an international standard for ships using low-flashpoint fuels,” he said.

Mr Hartsuyker said the final treaty in the report is a new taxation agreement with Germany aimed at curtailing tax evasion.

“Australia and Germany have taken the opportunity to update and modernise an existing treaty by incorporating the Organisation for Economic Co-operation and Development (OECD) /The Group of Twenty (G20) recommendations to prevent base erosion and profit shifting,” he said.

“By including these provisions in the treaty we hope to promote the work of the OECD and create a precedent for future treaties.”

Mr Hartsuyker said the Committee also presented a second report, which summarised material from the recent seminar held to mark 20 years of the Committee’s work.

“The report contains a full transcript of the presentations delivered at the seminar, reflections on the Committee’s work, an assessment of its performance and useful statistical data,” he said.

“The seminar provided some thought provoking ideas on the Committee’s future direction and I am confident that the information included in this report will prove useful to experts, academics and students of the treaty making process in Australia.”

The reports are available on the committee’s website: http://www.aph.gov.au/jsct or by contacting the committee secretariat on (02) 6277 4002.  

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