Anne Marie O’Callaghan.
Anne Marie O’Callaghan.

Tax breaks in bush plea

AN EMERALD accountant has rubbed shoulders with some of the nation's foremost fiscal minds as she delivered a plea for tax breaks in the bush.

O'Regan and Partners' Anne Marie O'Callaghan took centre stage at the Tax Forum in Canberra this week and it was an experience she won't forget.

With Prime Minister Julia Gillard and treasurer Wayne Swan in the audience, Ms O'Callaghan told the forum the current tax system provides little support to those employed, or seeking employment, in regions outside urban areas.

She pushed for attractive tax incentives for small to medium-sized business employers in rural and regional areas to support the employment and training of staff, as well as relocation incentives for workers to move to the bush.

But not the FIFOs.

"Presently, zone rebates for eligible persons working in remote areas are ineffective and inadequate in terms of compensating for increased living and travel costs," Ms O'Callaghan said.

"The rebate as it currently presents could not be regarded as an incentive to relocate to listed zones.

"The incentives may be structured as a combination of reduced income tax rates, zone rebates and increased Fringe Benefits Tax Remote Area Concessions.

"The incentives must be directly related to the period of residence in the area.

"Only persons residing in the selected region should be eligible for the incentive, excluding visiting workers with main residences elsewhere."

Ms O'Callaghan also called for capped accelerated capital works deductions to encourage new investment in areas of need, and the growth of existing businesses.

She said the move had the potential for a flow-on effect through the supply chain similar to the 2008-09 investment allowance tax break.

One of the key points outlined by Ms O'Callaghan was the overhaul of the threshold at which business starts paying payroll tax, which she described as "unreasonably low" given current salary levels in Australia.

"(They) should be reviewed significantly upward," she said.

"Payroll taxes should be equalised throughout Australian states.

"New and growing businesses in selected regions should be exempted from the payroll tax in the first three to five years of business at a time when cash flow pressures are heightened, growth is restricted by cash flow and the risk of insolvency is highest."

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