It’s been billed as an opportunity to save people from the time-consuming task of rummaging through receipts at tax time, but not everyone is happy.
At Labor’s official campaign launch, Anthony Albanese promised almost six million workers an instant $1000 tax deduction.
The prime minister said the change, originally put forward in a tax reform paper more than a decade ago, would benefit mainly low and middle-income earners who could claim the write-off without receipts or records.
CPA Australia, the nation’s leading accounting body, said the instant deduction could save workers time, but might mean they miss out on the full refund they are entitled to.
“Taxpayers should be encouraged to take greater responsibility for their finances and tax obligations,” tax lead Jenny Wong said.
“Clicking a few buttons to get a basic deduction may be easy, but it is unlikely to be in the best interests of taxpayers or the economy.”
Chartered Accountants Australia and New Zealand urged taxpayers to hold onto their receipts.
“The standard deduction only relates to expenses associated with labour, so those taxpayers who also earn business income, rental income, interest and dividends … will need to keep their receipts to claim deductions related to those activities,” the organisation said.
But George Washington University economics professor Steven Hamilton said Labor’s proposal would save the tax office and people money, in addition to moving to a system where no one has to itemise.
“The ATO has to spend a lot of money policing those deductions, and it’s just simpler for everybody,” he told AAP.
“It’s a great example of how making our tax system simpler and more straightforward can lift a big weight off of the economy.”
Opposition Leader Peter Dutton arrived in Melbourne on Monday evening as the coalition targets mortgage-belt seats in the key battleground state.
Polling conducted by Roy Morgan shows Labor ahead of the coalition, 54.5 to 45.5 per cent on a two-party preferred basis.
More than a third of voters say Australia is going in the “right direction” at 34.5 per cent, with the number of people saying the opposite down 4.5 points to 48.5 per cent.
A separate Resolve poll published by the Nine newspapers had Labor ahead 53.5 per cent to 46.5 per cent in two-party preferred terms.
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