Calls from Broome to boost, not scrap ZTO

Headshot of Jakeb Waddell
Jakeb WaddellBroome Advertiser
The report recommends the Federal Government scrap the zone tax offset claimed by hundreds of thousands of regional Australians each year.
Camera IconThe report recommends the Federal Government scrap the zone tax offset claimed by hundreds of thousands of regional Australians each year. Credit: WA News

Business owners and leaders in Broome have slammed a report recommending the Federal Government scrap the zone tax offset claimed by hundreds of thousands of regional Australians each year.

The Productivity Commission’s draft Remote Area Tax Concessions and Payments report was released earlier this month, which proposed a number of changes to allowances and fringe benefits tax concessions in rural communities.

But it is the recommendation to abolish ZTOs across the nation that has ruffled feathers in the Broome community.

Residents of the Kimberley town can normally claim an allowance of $338 when lodging their tax return each financial year.

Individuals in remote areas, such as Halls Creek and Bidyadanga, are able to claim upwards of $1000.

The document stated that inflation and growth in wages had “substantially eroded the value of the ZTO” and that there was “no compelling justification” for it in contemporary Australia.

“Higher living costs or other aspects of life in remote areas do not warrant compensation from other taxpayers,” it stated.

Local accounting firm owner Desiree Male said there was already enough financial pressure on people living in remote areas like Broome.

“It is a common belief that the ZTO is already too low and I thought it should have been reviewed to increase it, but to abolish it would only put further pressure on these residents,” she said.

“It would also disadvantage small businesses who cannot afford to pay employees remote allowances and rely on these tax offsets.”

Broome Chamber of Commerce and Industry president Peter Taylor said it was unfortunate the report did not recognise the much higher cost of living in regional Australia.

“If anything, this zone allowance should be significantly increased to provide greater incentive for people to move to the regions and help develop the North,” he said.

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