Fed: Builders praise tax concession for contractors

AAP General News (Australia)
04-13-2000
Fed: Builders praise tax concession for contractors

CANBERRA, April 13 AAP - Builders have hailed the two-year tax reprieve for contractors
announced today by Treasurer Peter Costello as a victory for commonsense.

A crackdown on contractors was a major part of the government business tax reforms,
with those earning more than 80 per cent of their income from one source to be classified
as employees.

The reprieve meant many contractors would now be able to continue to be taxed as businesses
instead of paying higher income tax, and would not have their business deductions limited.

Housing Industry Association managing director Ron Silberberg said the concession protected
genuine contractors.

"The legislation puts a fence around genuine contractors who are running a personal
services business, while retaining the integrity of the tax avoidance measures," he said.

"The government at the outset gave HIA assurances that the housing subcontract system
would not be jeopardised by the proposed measures.

"The government has honoured its commitment."

Master Builders Australia said the two-year delay was a victory for commonsense, but
warned it would continue to fight for further changes.

"I believe we have achieved a significant breakthrough in protecting the sub-contract
system for the building and construction industry," MBA national executive director John
Murray said.

"While we're still far from happy that the government embarked on this particular legislative
approach, we're satisfied that we've now secured a two-year period where the industry
can seek to further minimise the adverse and unintended consequences."

AAP ss/mfh/lw/br r

KEYWORD: TAX BUILDERS

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