Small business benefits through tax break after State Government legislation change.
It’s taken 15 years, but the NSW government has finally announced that the Fire Services Levy applied to insurance premiums will be removed in 2017.
Since 2001, governmental and independent bodies reviewing the tax system within New South Wales have repeatedly recommended that the levy on insurance policies be abolished in favour of a fairer system, but until now, the recommendations have fallen on deaf ears.
When 2017 rolls around, state government will remove the levy; the costs of which, have long been carried by policy holders.
Historically, small business owners have been charged up to 36 per cent on top of their insurance premium, to cover the Fire Services Levy. Recommendations by tax reviewers – including the New South Wales Independent Pricing Regulatory Tribunal – sought to replace the levy with a direct, property-based tax to provide transparency to business owners and reduce their tax burden.
Last November, a White Paper on behalf of the Coffs Harbour Chamber of Commerce and Industry, was presented to the Minister of Small Business. It touched on broad insurance issues such as penalty rates, payroll tax and Compulsory Third Party (CTP) premiums and the Fire Services Levy. The Paper also raised the point that “while taxation provides an invaluable boost to Australian society, it is not the government’s prerogative to manipulate the tax rate for their own political ends.
“Taxation is not a punitive instrument for the government to wield against its people; instead, taxation should work for the people and be effective in stimulating growth within the economy.” It was the intent then, and remains today, that the Coffs Harbour Chamber of Commerce and Industry is to secure a fair deal for the tax-paying business owner, and help the taxation system to work efficiently for the betterment of the region, and the country as a whole.
So news on the removal of the Fire Service Levy falls directly in line with our goals to remove tax burdens from business so they remain incentivised to trade, create jobs and thrive.
Statistics discussed in the Paper reveal how development costs and lack of additional funds are two key barriers to business innovation.
Feeling tax pressures from above, the all too frequent reaction is to trim costs from below, resulting in redundancies and unemployment and the beginning of a deficit spiral. A lower number of functioning businesses in turn mean less tax for government and reduced funds in the public coffers for the public good.
As you know, the Coffs Harbour Chamber of Commerce and Industry aims to create a beneficial economic environment that makes the Coffs Coast a hub of trade and business while stimulating the economy of the area. One of the many activities undertaken to achieve this is the lobbying of government for fairer tax policies. The White Paper is a standing document with this purpose in mind and the removal of the Fire Service Levy is a great example of our ability to represent the voice of business to get a hearing with policy makers and enact lasting change.