Tax compliance burden reaches new heights

Research by an Australian law firm to develop a ‘tax compliance index’ is a sobering reminder that government efforts to cut red tape have much work to do. As reported in the Australian Financial Review yesterday:

Some 7500 pages of new tax rules have been imposed since the election of the Abbott government…

Law firm Mills Oakley has created its own index for tracking the amount of new tax legislation and regulations introduced each month by federal, state and territory governments and has found that while red tape might be being cut in other areas, the volume of new tax rules has not let up.

The firm’s private advisory partner, John Storey, said after a slight lull in the volume of new tax laws after the last federal election, the amount of tax compliance continues to increase.

While state and territory government revenue offices account for some of the paperwork, the federal government is the biggest offender…

“It’s this constant stream of new tax rulings – but I’m only talking about tax; in other areas of red tape it might be doing better,” Mr Storey said.

That the measure of regulatory burden in this area has grown so substantially is particularly concerning in light of multiple omnibus repeal days, as well as IPA research which showed that, since the election of the Coalition government in 2013, the pages of Commonwealth legislation passed annually has dropped by 43 per cent.

laws_passedThis demonstrates that efforts, critical as they are, to combat over-legislation can only form part of the deregulatory agenda. Regulations and delegated legislation are a significant part of the red-tape problem, which must be dealt with to ensure businesses are able to focus their efforts on actually conducting business.

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