Mr. Day raises concerns about the 1.8% tax on hire items and its impact on small businesses. The Treasurer acknowledges the issue and outlines measures taken to reduce compliance costs, including increasing the duty-free threshold and simplifying the duty regime.

AnsweredQoN 1301Legislative Assembly
Asked
1 April 2003
Portfolio
Treasurer

QuestionView source ↗

(1) Is the Minister aware of the tax of 1.8% charged on hire items?
(2) If so, is the Minister aware of the time and money it takes a small business to calculate the tax on each order which at the end of the month would exceed the amount of tax they pay the Government?

AnswerView source ↗

Answered
16 April 2003
Response time
15 days
(2) Yes. In order to reduce the compliance costs for small business, the Review of State Business Taxes has recommended replacing the current rental business duty provisions with a hire of goods regime. This will be consistent with the provisions operating in most other jurisdictions which will assist those businesses operating in more than one jurisdiction. As part of the move to a hire of goods approach, the duty free threshold has been increased from $25,000 to $50,000, removing approximately 150 small taxpayers from the duty base. Furthermore, compliance costs for small business will be reduced by the simplification of the duty regime and the removal of the service cost deduction.
As part of the move to a hire of goods approach, the duty free threshold has been increased from $25,000 to $50,000, removing approximately 150 small taxpayers from the duty base. Furthermore, compliance costs for small business will be reduced by the simplification of the duty regime and the removal of the service cost deduction.
Furthermore, compliance costs for small business will be reduced by the simplification of the duty regime and the removal of the service cost deduction.

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