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There are a range of tax measures in need of an overhaul however some are of greater importance to Australia’s accounting profession, a new survey has revealed.
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Top tax priorities for accountants revealed
21 February 2022
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10 minute read
CPA Australia’s latest poll has examined what tax reforms are of the greatest priority to its membership.
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According to the results, 49 per cent of respondents flagged goods and services tax (GST) as their greatest priority when it comes to tax reform.
A further 33 per cent selected fringe benefits tax, followed by interest on tax debts (9 per cent) and road user taxes (8 per cent).
Elinor Kasapidis, senior manager tax policy at CPA Australia said the results further prove how Australia’s tax system “is in dire need of an overhaul”.
“The list of areas which need reforming is as long as my arm, but we could only highlight a few in our poll,” Ms Kasapidis said.
“Reforming GST was the top pick for half of the survey respondents, and it’s ours too. We think it’s past time for the national, state and territory governments to come together to discuss GST reform.
“Sensible reforms like broadening the base and considering an increase in the rate will not only improve the efficiency of federal taxes but also allow the states to progress reform of more inefficient taxes such as stamp duty.”
The amount of respondents electing the fringe benefits tax option reflects the frustration accountants have felt over the current measures, Ms Kasapidis said.
“One third of respondents nominated Fringe Benefits Tax as their top tax reform priority, showing just what a headache the FBT system is for accountants and small businesses,” she said.
“We want the government to release the Board of Taxation’s FBT Compliance Costs Review, and its response to the Review, to enable FBT reform discussions to progress.”
Further, Ms Kasapidis urged the government to address the remaining options – road user taxes and interest on tax debt, noting both must be addressed at a federal level.
“Road user taxes is an issue which is growing in awareness, and this is reflected in the 8 per cent who put it first. We’re calling on the government to use the upcoming budget to implement a federal road user change system,” Ms Kasapidis said.
“As the adoption of electric vehicles (EVs) grows, the excise revenues used to develop and maintain Australia’s road infrastructure will decrease. There needs to be an orderly and well-managed transfer of the revenue base to EV users.
“Tax liabilities incur interest rates which are significantly above market rates. This can be crippling for small businesses, most of which pay their tax liabilities within 90 days. It’s also a bugbear for many accountants, which is reflected in the nearly 10 per cent of respondents who placed this issue at the top of their list.”
Looking ahead, Ms Kasapidis reiterated the importance of the upcoming federal budget in addressing reform of Australia’s tax system, particularly as it comes off the back of a challenging two years.
“The existing structural challenges in Australia’s tax system have been exacerbated by COVID-19. If we’re serious as a nation about raising productivity and achieving strong economic growth that will lift future living standards, we need to tackle tax reform head on,” she said.
“The government should prioritise reform of Australia’s tax system in the Federal Budget. That said, we’re realists. We know that the budget is unlikely to yield any major tax announcements. I’d be very surprised to see any blue sky thinking on tax reform this close to a federal election. But that doesn’t mean it’s not warranted.”
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