Current tax laws discriminate against non-party political candidates for local government elections
Hobart City Council candidate and chartered accountant Tiina-Liisa Sexton, is warning other candidates that although Local Government regulations allow for election expenditure up to $5,000, only a maximum of $1000 will be allowed as a tax deduction (s25.65 Income Tax Assessment Act 1997).
“It is important for all candidates to understand this limitation, but this limitation, which does not apply to State and Federal elections, is flagrantly discriminatory against local government candidates, especially candidates who are not already well known in the community, or who do not have the backing and support of a political party”, Mrs Sexton said.
“In 2009 the President of the Australian Local Government Association wrote to Treasurer Wayne Swan, requesting a review of the $1000 limit and Mr Swan replied on 16 November 2009 stating that “..as a concession to candidates for election to local government, the Government allows a deduction of up to $1000 for expenditure incurred on contesting an election for membership of a local governing body. While the election expenses of candidates for local government elections do not receive the same level of concessional treatment as candidates for State and Commonwealth elections, the concession provided is still significant””.
“The $1000 limit has remained unchanged since its introduction in 1985 and cannot therefore any longer be described as “significant”, especially compared to the limitless expenditure allowed as a deduction for candidates contesting an election at a territory, state or federal level of government”, Tiina-Liisa Sexton said.
“This inequity in the amount allowed as a deduction for election expenses in local government will further disadvantage independent community candidates as political parties pre-select and support more of their own candidates”.
“It is also another reason why independent community candidates will think twice about contesting a local government election”, Mrs Sexton said.
The Local Government Association of Tasmania may wish to pursue this issue again with the Federal Treasurer, Wayne Swan and suggest that at the very least, tax deduction limits be matched to those contained in the Local Government (General) Regulations 2005. Regulation 22 has a limit of $5 000 for a single election and $8000 in respect of an election for a councillor and an election for a mayor or deputy mayor.
1 Letter from Wayne Swan http://nga.alga.asn.au/business/resolutions/2009/responses/Letter_from_Swan.pdf
