INTHEBLACK April/May 2024 - Magazine - Page 23
“When we are worrying about
climate, when we are worrying
about housing affordability and
when we are worrying about
productivity, we should be
thinking about tax.”
ALLEGRA SPENDER MP
Spender held a series of roundtables on
potential tax reforms in 2023, with leading
business groups and leaders, economists,
unions, social sector organisations and
environmental groups in attendance.
“This is being done with an awareness
that reform often takes quite a significant
amount of time,” Spender says.
“The way I approach tax reform is to look
at the why first, to ask, ‘Why do we need it?’
I look at it through a number of lenses.
One is around productivity and how tax
influences productivity, which is critical
to Australia’s economic growth.
“I also look at it through other lenses,
particularly intergenerational equity and
making sure that each generation can
continue to thrive and has economic
opportunities. That is, how to ensure
that we support our transition to low
carbon and protect our environment.”
Spender says one job is to explain the
important role of the tax system to the
broader community.
“When we are worrying about climate,
when we are worrying about housing
affordability and when we are worrying
about productivity, we should be thinking
about tax,” she says.
“I think that makes the political will
easier, because the more the community
is at least open to considering tax reform,
the more the politics start to become possible.
“The Intergenerational Report showed
us that we cannot just carry on,” Spender
says. “We have these demographic shifts
happening, and we have structural changes
happening. That means that we have
to deal with it.”
HONG KONG’S FOCUS ON
CORPORATE INCENTIVES
Anthony Lau FCPA, partner, international tax services at
Deloitte Hong Kong and chair of CPA Australia’s Hong Kong
Tax Committee, says Hong Kong is currently mostly focused
on enhancing competitiveness, revitalising the economy
and introducing industry-specific tax incentives.
“Reducing the tax rates on individuals may not be
the current focus, nor a long-term policy of the Hong Kong
government, although we have seen one-off measures –
such as tax reductions to reduce individuals’ tax burdens –
in the past few years,” Lau says.
On the OECD’s Two Pillar reforms, Lau says there would likely
be an additional tax burden for multinational enterprises paying
less than the minimum 15 per cent global tax rate.
“In view of the Two Pillar reforms, Hong Kong will introduce
a qualified domestic minimum top-up tax (QDMT) to protect its
taxing right, which may diminish Hong Kong’s competitiveness
as a low tax jurisdiction. In view of this, we understand the
Hong Kong Government is exploring other ways and policy
measures to improve Hong Kong’s competitiveness.”
Hong Kong’s Inland Revenue Department has other tax reforms
in its pipeline, including plans to review and enhance the tax
concession regimes for funds and carried interest, Lau adds.
“Meanwhile, legislations have been introduced to
enhance the existing aircraft leasing preferential tax regime
and provide new tax deductions for spectrum utilisation fees
for telecommunications network operators.”
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