CCI critical of payroll changes

The Chamber of Commerce and Industry WA has criticised the state government’s crackdown on payroll tax exemption for employees earning more than $100,000 announced today.

The government said that from tomorrow, exemptions will be limited to all apprenticeships and to traineeships undertaken by new employees earning less than $100,000 per annum.

Existing contracts that were lodged before December 1 will continue to be exempt as long as wages do not exceed $100,000.

The government said the expenditure on this scheme equates to 2.4 per cent of the total payroll tax base and is unaffordable; citing that payroll assistance provided by other states and territories is less generous.

The second part of the changes will be to replace all remaining apprentices and trainee exemptions with a grant scheme, which the government said could start from July 2019.

Treasurer Ben Wyatt said a grant scheme would be more transparent.

“The previous system has been open to abuse,” he said

“This new system will also be a boost to small businesses as we work towards a grant system which is available to all businesses, not just those who pay payroll tax.”

However CCI WA chief economist Rick Newnham said the removal of the exemption will halt upskilling in the WA workforce.

“Automation will continue to have widespread impacts on employment in WA, particularly for older employees,” he said

“The payroll tax exemption for trainees assists employers to retrain and develop their workforce as technology drives rapid changes in the economy.

“The government has conducted no industry consultation despite this decision inevitably leading to sub-standard training in WA, below the national accredited standard.”