\n Find out more<\/p>\n <\/a>\n <\/p>\n
CPA Australia Tax lead Jenny Wong said the prospect of such a change so close to budget night was already \u201cfuelling anxiety and speculation\u201d among businesses, investors and advisers.<\/p>\n
Wong said: \u201cTo float the idea of taxing trusts one week out from the Federal Budget is unfair to the millions of Australians who use and are beneficiaries of trusts.<\/p>\n
\u201cCPA Australia supports a fair and sustainable tax system, including targeted measures to address inappropriate tax minimisation.<\/p>\n
\u201cHowever, the lack of clarity around what the 30% tax would entail is causing panic and uncertainty \u2013 this is poor policy development.\u201d<\/p>\n
Citing media reports, she said that the government is considering a non-refundable withholding mechanism that would apply a minimum 30% rate to distributions from trusts.<\/p>\n
This kind of framework would \u201cmaterially alter\u201d after-tax positions and could fall most heavily on middle income earners and smaller operators.<\/p>\n
\u201cAn effective personal income tax rate of 30% typically applies to taxable income nearing A$200,000 [$144,920], yet millions of middle income Australians receive trust distributions as part of normal business and investment activity.<\/p>\n
\u201cTo impose a blanket rate that sits at the higher end of tax rates in Australia isn\u2019t about restoring equity \u2013 it risks introducing a punitive regime,\u201d Wong added.<\/p>\n
The professional body argued that overlaying major new settings on top of already complex trust rules without first simplifying the system would further increase compliance pressures.<\/p>\n
In particular, it pointed to the existing administrative demands linked to family trust election provisions.<\/p>\n
Wong also recalled that a comparable minimum tax concept had been examined in the past but was ultimately abandoned, highlighting what she described as the \u201csensitivity and complexity of trust reform\u201d.<\/p>\n
Last month, CPA Australia criticised the federal government\u2019s draft reforms<\/a> on foreign resident capital gains tax rules.<\/p>\n ![\"Email](\"https:\/\/www.theaccountant-online.com\/wp-content\/themes\/goodlife-wp-B2B\/assets\/images\/newsletter-new.svg\")
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\n Give your business an edge with our leading industry insights.\n <\/p>\n","protected":false},"excerpt":{"rendered":"CPA Australia added that new rules layered onto an already complex trust system would worsen compliance burdens. Credit:…\n","protected":false},"author":2,"featured_media":652960,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[64,63,44],"class_list":["post-652959","post","type-post","status-publish","format-standard","has-post-thumbnail","category-australia","tag-au","tag-australia","tag-news"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/652959","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=652959"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/652959\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/652960"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=652959"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=652959"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=652959"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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