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The Tax Office, armed
with a $337.5 million funding boost in the budget, expects to reap more than
$200 million a year in the next four years by compelling businesses to pay
strict attention to GST rules.
Tax accountants said yesterday a likely initial target for the audit regime
would be the property and construction industry.
Businesses claim GST credits on the cost of their supplies. But the credits have
strict conditions and firms are required to offset them by handing the GST they
collect to the government.
''If you look at where tax lawyers make a lot of their money, it is on GST and
property issues,'' said one accountant who did not want to be named.
Another possible target would be property developers who choose to hang on to
projects rather than selling them.
The general manager of policy and research at CPA Australia, Paul Drum, said
that if developers claimed credits during construction they would need to pay
them back if they changed the purpose of the property.
''At the big end of town we think this is pretty well watched and known about.
But in the mid-tier and further down the development food chain, these guys
mightn't even know about the rules, and we're not sure of the level of
checking,'' he said.
The tax counsel at the Institute of Chartered Accountants, Yasser El-Ansary,
said small retailers and tradesmen operating as partnerships or sole traders
could also be targets.
The GST crackdown is the second biggest savings measure in the budget, after
lower prices on pharmaceuticals. By 2014, the government expects to recoup $1.13
billion from the program.
Source:
Sydney Morning Herald,
Australia, dated
13/05/2010
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