Small business faces axed mining tax payback

“Treasurer Joe Hockey and the Finance Minister, Mathias Cormann, yesterday confirmed the government would backdate the abolition of key tax concessions associated with the mining tax, which will force a re-assessment of some tax returns.

In line with the Coalition’s election commitments, some concessions cease from July last year and others from January this year.

The Council of Small Business of Australia said the timing would create extra cost and confusion for small business operators.

COSBOA executive director Peter Strong expressed “disbelief’’ at the government’s decision to stick with its pre-election timetable for the abolition of measures such as the company loss carryback and the reduction in the ­instant asset write-off.

“You don’t change the tax ­arrangements midway through a financial year,” he said.

But the government, which has changed its original abolition date for other payments such as the Schoolkids Bonus, defended the move, arguing it was sticking to the dates it had published prior to the last election and had reiterated since winning office.

Opposition Treasury spokesman Chris Bowen said the Coa­lition had created a red-tape nightmare for small business.

Mr Bowen said the government’s position would see the Tax Office redoing company tax returns, and lumping small businesses with the tax bill.

The small business attack came as Bill Shorten ruled out reintroducing the Gillard-Swan version of the mining tax. However, he left open the option of re-visiting the issue in government.

“We do believe that Australians are entitled to their fair share of the natural resources of this special country within which we live, but the process has to be done through consultation with state governments and industry,’’ the Opposition Leader said.

With the mining tax abolished last week, the government yesterday announced the company loss carry-back would be abolished from July 1, 2013.

The instant asset write-off would be reduced from January 1 this year and accelerated depre­ciation for motor vehicles would also be abolished from January 1 this year.

The Tax Office said the repeal of the company loss carry-back provisions from July 1, 2013 meant companies that had claimed the concession in their 2013-14 ­returns would face amended tax assessments. But they would not be subject to penalties and interest if payment was made within a reasonable time.

The ATO said taxpayers who had lodged their 2013-14 income year return under the previous law should now seek amendments to reduce their depreciation claim.

Under the abolition, which ­received Royal Assent last Friday, companies will no longer be liable to pay the min­ing tax after ­September 30.

Labor launched a resources super profits tax in May 2010 with the promise it would generate $12bn over two years. The revised minerals resource rent tax was forecast to raise only $130.9 million this financial year.”