Fun and Games

I received today a letter from the Tax Institute that was sent to the honourable Bill Shorten MP - leader of the ALP. I won't reproduce all of it, but in part it read,

"It has been reported in the media recently that you described the long standing, express statutory availability of a tax deduction for assistance from a lawfully authorised tax practitioner as a "rort", and propose that a labor government would cap that deduction at $3,000.

Australia's tax laws now run to many thousands of pages. Ordinary Austrlaians did not ask for that. It has been inflicted on them by successive governments.

Over 30 years ago, the Commonwealth government decided to abdicate primary responsibility for administering its own tax laws and to impose that responsibility, via the so-called "self-assessment" system, on ordinary Australians, and to subject ordinary Australians to the threat of severe penalties if they failed to achieve perfection in carrying out that newly imposed obligation.

The apparent intention of that measure was to reduce the administrative costs incurred directly by government. The correlative effect as to increase drastically the costs incurred by many Australians in seeking to meet their new obligations.

The work of qualified tax professionals is an essential part of Australia's tax system.

Tax deductibility of advice in complying with tax laws is a legitimate expense of business, investment or other income earning activities. We utterly reject the notion that an open, express and long standing right to a tax deduction for costs in complying with laws imposed by government is a rort, and strongly oppose a de facto increase by restriction of that right."

It would appear to most informed practitioners that the contents are hard to argue with. It is a huge issue with all accounting bodies including the one I am a member of being the Institute of Chartered Accountants. The professional bodies are bemused and upset at being slurred by one side of politics and by the divisive nature of the politics to "attack the rich" and segregate our society into "the so called rich" and "the people of the ALP ".

Whatever your persuasion or ideology, a unified society has to be preferable to a broken one and all attempts to bring people together should be demanded by society. The fears and move to the extremes being experienced in other countries, (notably the US) are not helpful and will not be seen as anything other than destructive when history books are written about our times in the future. See through the rhetoric to the world we want to create for our children. Limiting advice and asking people to go it alone in an increasing volatile world will not take us to the best place possible.