Car industry Serious about FBT decision

Car industry Serious about FBT decision :Today the  Fring benefit Tax(FBT) decision is made by Government of Australia is seriously concern to the Car Industry here the detailes.  The car industry is urging the federal government to reconsider its decision to remove the fringe benefit tax (FBT) concession on vehicles to help pay for the ditching of the carbon tax.  Prime Minister Kevin Rudd announced Tuesday will go to market Australia (ETS) from 1 July 2014 - a year earlier than expected.

This means that the fixed carbon price of $ 25.40 per tonne from July next year, does not apply, and the price should drop to about $ 6, first under the ETS. The carbon price is currently $ 24.15.

The transition to the ETS will cost $ 3800000000 budget over the next four years, including $ 1800000000 will consist of FBT changes related to salary sacrifice and vehicles by the employer.Federal Chamber of Automotive Industries (FCAI) said the changes starting on Tuesday will have serious consequences for both import and domestic car sales.

"The consequences will be paid directly by the industry, including dealers and service" FCAI CEO Tony Weber said in a statement."I want to know whether the government really understand the consequences of this decision, and why the industry has not been consulted on these important changes."

Accounting firm Grant Thornton Australia said it would increase the administrative costs due to the way benefits are calculated.  Applicable statutory formula is canceled for new contracts, resulting in a fashion magazine, which requires the employer to control the cost of each car and evaluate the use of the commercial use of the employee filling the log.

FBT is payable on the private part of the cost.  "This is a significant additional administrative burden compared to the previous method allowed by the formula," said Grant Thornton FBT specialist Elizabeth Lucas. "It also means a higher tax FBT for many employers."

The retail industry is concerned about the impact of FBT change, saying it will affect 320,000 workers across the country.  "They will lose money, and they will have less money to spend," Australian Association executive director Russell Zimmerman told AAP retailers.

In a broader sense, the Chamber of Commerce and Industry chief economist Greg Evans Australian describes the transition to the ETS as a "short-term solution," without addressing the long-term problem.
"It offers no real solutions, it provides no assurance, and it is not sustainable savings for the company," said Mr. Evans reporters in Canberra.  He said he had a tax burden multibillion dollar Australian company not paying its competitors.  "It's bad for business, are harmful to the economy and bad for employment," he said.

The Australian Industry Group has also criticized the measures to reduce costs.  "Changes to Car FBT treatment means taxpayers will face higher tax bills each year," Chief Executive Innes Willox said in a statement.  The Business Council of Australia (BCA), which represents 100 employers in the country, says companies continue to suffer.

"Companies are more likely to pay part of the cost of higher carbon world until next year" BCA chief executive Jennifer Westacott said in a statement.  BCA believes ETS design is flawed because it does not tackle the problem of the competitiveness of the sector or give effect Australia is in line with the rest of the world.