Fed: Govt to change tax rules

AAP General News (Australia)
04-13-2000
Fed: Govt to change tax rules

CANBERRA, April 13 AAP - Contractors will get tax reprieves under new measures the
federal government says will not increase the net burden on taxpayers.

Treasurer Peter Costello has agreed to soften the government's proposed crackdown on
contractors and allow some in the industry to walk free of tax office scrutiny.

The move steps away from a Ralph tax report recommendation to stop some workers claiming
business deductions under the guise of being contractors.

The report recommended that contractors who earned more than 80 per cent of their income
from one source must obtain a special tax office ruling on whether they qualified for
company tax.

"When John Ralph brought his report down he said that you have to set up a system whereby
people who are really employees couldn't pretend that they were contractors and walk out
of the PAYE system, but you had to protect genuine contractors who really are in business,"

Mr Costello told ABC radio.

"And what we are trying to do here in legislation which I'll be introducing today is
to protect genuine contractors.

"And what this legislation says is those people who have always been recognised as
contractors continue to be recognised as contractors and treated as people in business."

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KEYWORD: TAX COSTELLO

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