As a result of the considerable advocacy work done by the Group of 100 (G100) and others, the Federal Government has decided to hold an inquiry into the challenges companies face setting up Employee Share Schemes (ESS). The enquiry will be held by the House of Representatives Standing Committee on Tax and Revenue.
Focusing on the tax treatment and whether improvements could be made to the standard documents provided by the ATO, the G100 will be making a submission.
The terms of reference for this inquiry are:
- how effective the changes in 2015 have been in their goal of bolstering entrepreneurship in Australia and supporting start-up companies;
- the costs and benefits of these concessional taxation treatments, and deferred taxing points for options, to the broader community;
- whether the current tax treatment of ESS remains relevant to start-up companies and whether any changes are appropriate to ensure the taxation treatment remains relevant;
- how companies currently structure their ESS arrangements and how taxation treatment affects these decisions; and
- the challenges faced by companies in setting up an ESS arrangement and how the standard documents by the Australian Taxation Office, and introduced in 2015, assist this process and whether additional improvements should be made.
If you have any comments or views on the inquiry, please let us know. You may contact Stephen Woodhill, CEO of the G100 or the G100 office.