Government asked to expand hire purchase arrangements to help more trucking operators benefit from 30 percent investment allowance
The Rudd Government is being asked to pass legislation to expand hire purchase arrangements to help more trucking operators benefit from the 30 percent investment allowance.
The Australian Trucking Association (ATA) wants the hire purchase scheme amended despite claims from the Australian Tax Office (ATO) that changing it is illegal.
Currently businesses that have signed hire purchase contracts before June 30 will receive the stimulus package but those who only placed an order contract before then will not.
The ATA says there are operators unclear about the conditions of the scheme, and wants the Government to intervene on their behalf.
“The ATA will now ask the Government to introduce legislation into Parliament to help businesses, including trucking businesses, who planned to finance equipment using hire purchase and placed orders in the belief they would be able to claim the 30 percent tax break, based on the date of their order contract,” a statement from the organisation says.
Manufacturers, however, do not seem as concerned. Trucking Industry Council (TIC) Chief Executive Tony McMullan says the conditions of the stimulus package are clear.
“My understanding from discussion with the tax office was that this [signing a hire purchase contract by June 30] was the necessary condition in order to qualify for the incentive and that TIC members were conscious of the details of the investment allowance,” he says
McMullan also says he believes the incentive has done all it can do by raising truck sales in May and June.
He says steps must now be taken to ensure this continues, sighting the Federal Government’s $42 billion Nation Building scheme as one of these measures.
“In order for the Government to deliver the $42 billion infrastructure spend, there will need to be initiatives undertaken to encourage new truck sales in order to meet and deliver this infrastructure spend,” he says.
“The benefit for the broader public will be safer and greener trucks on our roads.”
McMullan has also met with government officials to raise the issue of operators struggling to secure finance for new trucks.
He says the Government is aware of the issue and the Treasury department is monitoring the situation.