A range of professional associations are hoping the return of Kevin Rudd to the role of Prime Minister may provide an opportunity to rethink the cap on self-education expenses, handed down in the last Federal Budget.
The cap, introduced by former Treasurer, Wayne Swan, puts a restriction on the amount professionals can claim as a tax deduction for self-education expenses, limiting it to just $2,000 per year, from 1 July 2014. The final details of the cap have yet to be released, and there are concerns that it will also apply to conference expenses incurred by professionals.
A group representing around 20 professional associations, including the Institute of Chartered Accountants and CPA Australia, met in Canberra this week to demand the cap be axed.
‘Professionals, including doctors, nurses, midwives, dentists, pharmacists, accountants and lawyers, are required to undertake continuing professional development so the public is provided with quality services,’ the groups said in a joint statement issued to coincide with the meeting.
The cap will escalate the cost of education to individuals to meet these professional obligations
‘The cap will escalate the cost of education to individuals, including the self-employed, to meet these professional obligations. If unable to be met by the individual, it will create an unaffordable impost on small business.’
The associations also pointed to the economic impact of imposing a cap on education expenses:
‘The cap threatens Australia’s ability to become a productive, innovative, contemporary knowledge-based economy…The cap will discourage people from being sufficiently prepared for the high value jobs of a modern services and knowledge-based economy.
‘The cap on self-education tax deductions will particularly disadvantage some groups in the community by deterring those seeking to upgrade their skills and education, for example women returning to the workforce after having children.’
Several industry associations have also lent their support to an online petition, called Scrap the Cap, which has garnered nearly 10,000 signatures.
The Institute of Public Accountants (IPA) said the cap would significantly impact who must demonstrate ongoing education in order to maintain their license and professional qualifications.
“There is also a need for some of our members to update their qualifications to meet ongoing eligibility requirements for the new Australian Financial Services License limited licensing regime or the commercial law requirement for Tax Agent Registration,” said IPA CEO, Andrew Conway.
Mr Conway said the IPA was calling on the Government to rethink the policy decision, before the 1 July 2014 commencement date.
The Treasury is currently seeking submissions on the reforms; the deadline for submissions is 12 July 2013.
