The electioneering has begun and the Coalition has put forth proposal to allow small businesses to claim business-related meal and entertainment expenses, in a boon for hospitality.
The proposal was announced this week by opposition leader Peter Dutton, suggesting a capped tax deduction for small businesses of up to $20K.
Clubs Australia welcomed the proposal, noting it encourages the reduction of red tape and that the policy aligns with its advocacy for fringe benefits tax reform.
“Any policy that encourages increased patronage at hospitality venues – especially in the current economic climate – would be welcomed with open arms by clubs across the country,” suggests Clubs Australia’s executive director, Rebecca Riant.
“The proposed $20,000 capped tax deduction would allow small business owners to use club facilities for business-related meals and events, driving foot traffic into not-for-profit community clubs and giving them a much-needed financial boost.”
The change is being seen as a significant win for venues across the country, particularly in the wake of high operating costs and financially challenged patronage.
Industry watchdog the Australian Hotels Association was also quick to welcome the move, having lobbied for FBT reform for some time.
“This policy proposal by the Coalition is a win for common-sense – especially during a cost-of-living crisis,” stated AHA National CEO Stephen Ferguson.
Under the current FBT structure business owners cannot take workers to a hotel or club without the business and worker being subject to additional taxes.
“Why shouldn’t a boss be able to take his hard-working team down to the pub and shout them a meal and use it as a deduction? Everyone wins.
“It’s great to see the Coalition has listened and supports our proposal.”
The initiative stands in contrast to developments in the ATO’s re-assessment of its R&D incentives, which have been in doubt for gaming-related companies.
Australia’s R&DTI program was established in 2011 by the Gillard Labor Government to encourage businesses to invest R&D dollars locally, both to create jobs and maintain a skills base. All applicants for R&D tax credits are assessed independently by the Australian Tax Office and AusIndustry.
In the MYEFO (Mid-Year Economic and Fiscal Outlook) the announcement came that the gaming sector will be excluded from the program.
“This decision will affect Australian businesses that have historically invested heavily in local research and development and job creation,” bodes Jinesh Patel, CEO of the Gaming Technologies Association.
The GTA and members work with all governments and regulators on harm minimisation initiatives and reforms, including technologies recently trialled in licensed venues that were developed through R&D dollars, and the association is disappointed in the decision – particularly after the establishment of a review into R&D to ‘enhance global competitiveness and secure future prosperity’.
“We are surprised that a decision would be made which works in the opposite direction,” adds Patel.
“The GTA believes that all Australian industries should be given the same opportunity under the R&DTI scheme without arbitrary exclusions.”
