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ATO announces review of MP allowances ruling

The Tax Office has responded to pressure from the media in relation to travel allowances and work-related expenses for politicians, with Tax Commissioner Chris Jordan announcing a review of the MP allowances ruling.

ATO announces review of MP allowances ruling
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In announcing the review, Mr Jordan was quick to state there are no special rules for Members of Parliament.

“The rules are the same for every taxpayer, regardless of their occupation,” the Commissioner said.

“Any taxpayer who has had to travel overnight for work is entitled to deduct the costs of meals and accommodation under our tax laws.

“However, given that there are clear misunderstandings of how the ruling is applied, we will undertake to review the 1999 ruling to give greater clarity for all taxpayers on the treatment of allowances they may receive from their employer to cover the costs of work-related travel.”

In a statement, the tax office reaffirmed there are no special tax rules for Members of Parliament regarding travel allowances and other deductions.

“They have the same entitlements and responsibilities as other taxpayers. The returns of all taxpayers, including Members of Parliament, are scrutinised.”

The ATO issued a public ruling on this issue in 1999 following wide consultation. This ruling specifically deals with how the Tax Office assesses travel allowances and deductions for Members of Parliament, and according to the Tax Office, is consistent with how the courts have applied the general laws applying to all taxpayers regarding the deductibility of work-related travel expenses.

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