Close Search
 
MEDIA, JOBS & RESOURCES for the COMMON GOOD

NFPs To Be Caught in Super Tax Fallout


24 June 2010 at 11:55 am
Lina Caneva
The proposed Resources Super Profits Tax (RSPT) on Australia's mining industry could cost Not for Profits up to $10 million dollars annually in lost investment funds.

Lina Caneva | 24 June 2010 at 11:55 am


4 Comments


 Print
NFPs To Be Caught in Super Tax Fallout
24 June 2010 at 11:55 am

The Federal Government's proposed Resources Super Profits Tax on Australia's mining industry could cost Not for Profits up to $10 million dollars annually in lost investment funds, according to fund management experts.

Australian fund managers, Private Portfolio Managers (PPM) says that amongst all the commentary regarding the proposed Resources Super Profits Tax, the effect on superannuation funds and Not for Profit organisations seems to have been overlooked.

The Head or PPM Corporate Development, Kris Vogelsong says that under the proposed tax scheme, resource companies like BHP and Rio Tinto would pay an additional tax equivalent to 40% of their 'super' profits, but the new tax will not earn imputation credits that could be reclaimed by super funds and tax exempt organisations, that own shares in resources companies.

Vogelsong says the result will be a transfer of wealth to the Government and Self Managed Super Funds, public offer superannuation products, industry funds, foundations, charities, Private Ancillary Funds and Australian NGOs are all potentially effected. 

Under the current imputation system, these entities can claim back tax paid by the companies held in their investment portfolios, however, the RSPT will not create franking credits, reducing the income that can be distributed directly or recouped through the imputation system.

He says for charities, there is nothing in the proposed tax reform package to help offset the wealth transfer to the Government and the losses could be as high as $10 million dollars annually.

He says as an investment manager who manages funds for charitable organisations, he's disheartened by the effect of the RSPT on Not for profit organisations who contribute so significantly to the social and cultural substance of Australia. 

He says it is safe to assume that the implications for the charity sector were not fully understood and have certainly escaped consideration.

Vogelsong says the Federal Government could resolve the franking credits issue by considering some form of compensation for the Not for Profit sector.

Link: http://www.ppmfunds.com/


Lina Caneva  |  Editor  |  @ProBonoNews

Lina Caneva has been a journalist for more than 35 years. She was the editor of Pro Bono Australia News from when it was founded in 2000 until 2018.

PB Careers
Get your biweekly dose of news, opinion and analysis to keep you up to date with what’s happening and why it matters for you, sent every Tuesday and Thursday morning.

Got a story to share?

Got a news tip or article idea for Pro Bono News? Or perhaps you would like to write an article and join a growing community of sector leaders sharing their thoughts and analysis with Pro Bono News readers? Get in touch at news@probonoaustralia.com.au or download our contributor guidelines.

Advertisement

Subscribe HR

Get more stories like this

FREE SOCIAL
SECTOR NEWS

4 comments

  • Matt Johnson Matt Johnson says:

    This article is propaganda at best and irresponsible at worst. The basis of a RSPT is to ensure the wealth of a nation is retained for investment in social and government service provision.

    Protection of the ROI for charitable organisations' investments should be secondary to a strong government able to provide grants, funding and essential services and infrastructure to it's people.

    After all shouldn't the goal of any NFP be to reduce the need for it services by empowering and promoting a healthy and fruitful society.

  • Anonymous Anonymous says:

    What's the NFP sector doing investing in mining anyway? Shouldn't they be investing in socially and environmentally responsible areas – which, as per Matt's comment above, promote and empower people to build strong lives and communities.

    If the above article is true, maybe the mining tax will encourage more socially responsible investment from the very organisations that should be investing in this way. And that certainly isn't a bad thing.

  • IreneS IreneS says:

    This article is absurd!

    The mining industry has just hit the nation in the face with the most coward act in the political history of this country!
    Scheming with sordid right wing politicians to depose a prime minister that was overwhelmingly chosen by the people of this country.
    Kevin Rudd was trying to take from the rich to invest in the poor.
    You seem to be against that idea?!?

    Their executives are the richest people in the world! Social Justice demands that they be taxed accordingly.

    They create enormous social and environmental damage here and abroad.

    My NFP doesn’t need one cent from this industry!

  • Avatar Karen Mahlab says:

    Dear Irene and Matt.. Many thanks for your outraged response. It's good to hear our readers voices – however it comes.. However I must say in our defense that This article was written as a report on what PPM has claimed..It does not reflect the views of this NewsService nor of Pro Bono Australia. The debate is obviously a lively and important one that generates intense opinions. Bring it on. Regards Karen

Your email address will not be published. Required fields are marked *



YOU MAY ALSO LIKE

Meet Pro Bono News’ first editorial advisory board

Wendy Williams

Thursday, 16th April 2020 at 8:02 am

Filling the Service Gaps That People Keep Falling Through

Dr Tessa Boyd-Caine

Tuesday, 5th September 2017 at 8:41 am

Foundation Moves to Multi-Year Charity Support

Lina Caneva

Tuesday, 14th February 2017 at 3:55 pm

Survey Reveals Australian Attitudes to Torture in Conflict

Lina Caneva

Tuesday, 6th December 2016 at 3:05 pm

pba inverse logo
Subscribe Twitter Facebook
×