NO.095

BOARD OF TAXATION TO UNDERTAKE SCOPING STUDY OF SMALL BUSINESS TAX COMPLIANCE

COSTS

As part of the Government’s commitment to reducing the regulatory burden

on business, I have asked the Board of Taxation to work closely with small businesses

(especially micro business) in order to identify and analyse the main costs

they face in complying with taxes administered by the Australian Taxation Office.

The Board will undertake a scoping study of tax compliance costs facing the

small business sector and identify the more important areas where compliance

costs might be reduced. It will provide a final report in the second half of

2006. Interim reports may be provided.

I have asked the Board to concentrate on the source of concerns of the small

business sector. The findings of the study will help with the Government’s

ongoing efforts to reduce excessive tax compliance costs facing business, particularly

the small business sector.

The Board’s report will take into account:

• the purpose and object of the law;
• the relationship between taxpayer compliance costs and government administration

  costs;

• costs incurred by business for non-tax reasons and any additional costs

  incurred by businesses or their advisors for tax reasons (tax compliance costs);

• transitional costs and ongoing tax compliance costs;
• taxpayer circumstances and commercial practices;
• other legislation; and
• any other matters the Board considers materially impact on small business

  tax compliance costs.

The Board of Taxation’s charter includes providing advice to the Government

on the quality and effectiveness of tax legislation along with the general integrity

and functioning of the tax system. Reducing compliance costs and complexity

has been a focus of the Board’s recent activities.

Details about the Board of Taxation can be found at http://www.taxboard.gov.au.

4 November 2005

MELBOURNE

Contact: Amanda Kennedy

03 9650 0244