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Aussie investment opportunities must become ‘more attractive’: BCA

Tax
20 January 2025
aussie investment opportunities must become more attractive bca

The Business Council of Australia has proposed multiple amendments to the Production Tax Credits and Other Measures Bill 2024 to help Australia maximise investment opportunities.

The Business Council of Australia (BCA) broadly supports the implementation of production tax incentives (PTIs) but believes certain changes need to be made to ensure they are upheld and exercised efficiently.

In a submission to the senate inquiry into the Future Made in Australia (Production Tax Credits and Other Measures) Bill 2024, BCA outlined that well-designed PTIs could help provide a foundation for Australia to be a competitive destination for hydrogen production and critical minerals processing and refining.

Despite general support, the council outlined amendments and recommendations to the bill which would aid in its success and overall benefit to the wider community.

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“The eligibility criteria and design of PTIs must not be so restrictive as to limit support for projects that otherwise meet the policy objectives, or to prompt investment going overseas,” BCA said.

“Many potentially eligible projects will naturally deliver benefits across local communities and supply chains, and so it follows that the community benefit principles must not be so narrowly or rigidly defined as to undermine the intent of the PTIs.”

The submission recommended that the eligibility determination be minimal, as this would aid in making Australia’s current poor productivity performance more competitive and more attractive for investment.

BCA also said the government needed to ensure community benefit principles would not enable criminal conduct as they risked increased costs, duplication of other policies and the offset of competitive gains achieved through PTIs.

The submission said the proposed dual agency model for the administration of the schemes was appropriate but would be significantly complex and costly to administer and comply with.

“It will therefore be critical to have settings in place to ensure the PTIs are administered effectively, consistently, predictably and efficiently,” BCA said.

“This includes clearly outlining administrator roles and responsibilities and information sharing arrangements, publishing timely and clear guidance material and establishing a timely and efficient dispute resolution process.”

The final recommendation to the bill made by BCA within the submission was that the start dates for PTIs should be brought forward, or considered to be, to help maximise their benefits.

BCA said earlier start dates would further enhance benefits for relevant projects if they were eligible for faster development approvals and would not increase the overall budget impact.

These recommendations were made in the nation's best interest, as BCA noted feedback they had received reflected sentiments that Australia was a less attractive destination for investment than it used to be.

“The benefits of PTIs will therefore not be realised to the fullest possible extent if it remains uncommercial to proceed with a project in Australia - be it through issues with project approvals processes, onerous community benefit principle requirements or other regulatory imposts,” BCA said.

“It follows that we must, as a point of national urgency, commit ourselves to the task of becoming a more competitive place to do business.”

About the author

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Imogen Wilson is a graduate journalist at Accountants Daily and Accounting Times, the leading sources of news, insight, and educational content for professionals in the accounting sector. Previously, Imogen has worked in broadcast journalism at NOVA 93.7 Perth and Channel 7 Perth. She has multi-platform experience in writing, radio and TV presenting, as well as podcast production. Imogen is from Western Australia and has a Bachelor of Communications in Journalism from Curtin University, Perth.

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