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Family Business in Australia
The Senate committee inquiry
On 20 March 2013 the Parliamentary Joint Committee on Corporations and Financial Services (“the Committee”) released the final report prepared as a result of its inquiry into Family Business in Australia, initiated on 16 August 2012.
Deloitte Private, which serves private companies and family businesses, welcomed the inquiry and submitted the following recommendations:
- The Australian Bureau of Statistics (ABS) consider developing criteria to categorise family businesses, small businesses and private businesses to facilitate more specific and detailed analysis of this vitally important sector.
- The ABS design its data capture to enable separate reporting on the family business sector.
- Government undertakes a review of the regulatory framework to stimulate investment in and the financing of family businesses.
- Government considers tax incentives and/or changes to regulations regarding debt and equity funding for family businesses.
- Consideration be given to structural reform of the taxation of trusts and the taxation of family groups to create certainty and simplicity.
Having received around 40 submissions, the Committee has gathered and analysed evidence on a range of issues and made 21 recommendations for better engaging the sector in policy setting.
Deloitte welcomed the following recommendations:
- Tightening of the data gathering process will give Family Businesses the voice they require for policy setting
- The establishment of a federal interdepartmental committee which will help identify policy issues for family businesses in order to better understand the sector’s profile and economic contribution
- The Governments refuting of the establishment of family trusts for tax limitations with family trusts now being viewed more legitimately
- Lifting of the 50 shareholder limit for private businesses and the 80-year maximum lifetime for trusts.