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Charities & Not-For-Profits Law in Australia

Tax Concession Working Group submissions now open

Posted in Compliance, Fundraising, General, Tax Exemptions & DGR Status

Tax PuzzleSummary – Submissions in response to the Not-For-Profit Sector Tax Concession Working Group’s discussion paper are currently being sought.

Submissions in response to the Not-for-profit Sector Tax Concession Working Group’s discussion paper, Fairer, simpler and more effective tax concessions for the not-for-profit sector released on Friday 2 November by the Assistant Treasurer, the Hon David Bradbury MP, and the Minister for Social Inclusion, the Hon Mark Butler MP, are currently being sought.

The Tax Concession Working Group was established in February 2012 by the then Assistant Treasurer, the Hon Mark Arbib, and the Minister for Social Inclusion, the Hon Mark Butler MP. Its goals are to consider ideas for better delivering the support currently provided through tax concessions to the Not‑For‑Profit sector, and it is intended to stimulate discussion, debate and feedback.

The discussion paper sets out the history and current status of tax concessions available to NFP sector including:

  • Income tax exemption and refundable franking credits;
  • Deductible Gift Recipients;
  • Fringe Benefits Tax concessions;
  • GST concessions; and
  • Mutuality, clubs and societies.

The paper identifies a number of reform options and sets out consultation questions to assist entities with responding to the paper. Questions include whether the current categories of exemptions are appropriate, whether all charities should be DGRs, should the threshold for deductible gifts (currently $2) be increased, should the rate for FBT rebates be realigned with the FBT tax rate, and should the gaming and entertainment services of NFP clubs be subject to a concessional tax rate for income over a certain threshold?

Responses to questions raised as a result of this discussion paper are encouraged both from the sector and the broader community.

It is important to note that the Working Group will have to identify savings from within the sector in order to fund any new proposals.

Written submissions in response to this discussion paper are due by 10am on Monday 17 December 2012.

The discussion paper is available for download from the Treasury website and submissions can be lodged online from that location as well.

The Working Group expects to provide a final report to Government by March 2013.