Explanatory Memorandum
(Circulated by authority of the Treasurer, the Hon Peter Costello MP)General outline and financial impact
Simplified accounting methods - extending availability
This Bill amends the A New Tax System (Goods and Services Tax) Act 1999 to enable the Commissioner of Taxation to extend simplified goods and services tax accounting methods to more small businesses and other entities with an annual turnover of less than $2 million.
Date of effect : These amendments are to apply from 1 July 2007.
Proposal announced : This measure was announced in the Treasurer's Press Release No. 038 of 8 May 2007.
Financial impact : These amendments will have these revenue implications:
| 2007 - 08 | 2008 - 09 | 2009 - 10 | 2010 - 11 | |
|---|---|---|---|---|
| GST | -$1m | -$2m | -$2m | -$2m |
| Income tax | Nil | $1m | $1m | $1m |
Compliance cost impact : There may be some minor transitional compliance costs for eligible businesses as they initially adopt the new simplified accounting methods. However, on an ongoing basis, the simplified accounting methods are expected to reduce their compliance costs.