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The Board of Taxation undertook a review of Small Business tax concessions. It issued a report to the Treasurer in March 2019. That report has now been released to the public.
Specifically in relation to the Small Business CGT concessions, the Board recommends:
- Integrating the eligibility criteria with the small business entity regime by raising the aggregated turnover threshold to $10 million per annum;
- Repealing the maximum net asset value test; and
- Collapsing the 15-year exemption, active asset reduction and retirement exemption and replacing them with one CGT exemption subject to a cap.
Assuming the above is implemented, the Board also recommends that contemporaneous reforms be considered in relation to:
- Improving the operation of the grouping rules; and
- Addressing any anomalies and integrity issues that are not addressed by other recommendations.
The Government has not yet formally responded to the Board’s recommendations.