State Australian Regulatory Taxation System-Myassignmenthelp.Com

Question: Discuss About The State Of Australian Regulatory Taxation System? Answer: Introduction This assignment has been presented with the objective assessing Australian regulatory taxation system. While conducting process of describing and assessing current state of Australian regulatory taxation system, emphasis will be laid on the use of two case studies associated with taxation system in Australia. In one of the case studies, essentiality of discussion on tax implication have been shown in case, a companys (Aussie Ltd.) profitability is hampered due to high level import duty incurred on annual sales. While developing this discourse, different issues associated with taxation principles on the tax payers deductible expenses have been highlighted. In another case study, it has been shown how it is essential to address principles of deductions and capital expenses in case of tax implications of incurred expenses. In this case study, emphasis has been laid on providing James with suitable advice so that he can deal with tax implications of incurred expenses. While developing di ametrical discussion associated with Australian taxation system, legal cases, rulings, and legislations have been referred, which are fundamental to Australian taxation law. In this way, knowledge on Australian taxation system has been applied to hypothetical situation associated with given case studies. Based on discourse associated with case study, there are some issues, which have been explored. Management of Aussie Ltd. has not shown efficiency in identifying tax related risks in advance. The concerned organisation could not have been able to maintain integrity in reporting with the objective of aligning tax position with law. On the other hand, organisations profitability has been hampered to a great extent due to increase in spend on advertising campaigns From the given case study, it has been inferred that Aussie Ltd, a subsidiary of Meranti Ltd has been facing issues due to Australian Governments decision on incurring high level import duty. As a result of this, annual sales of furniture have been impacted to a great extent and for covering this loss, Aussie Ltd. has no option but to focus on spending on advertising campaign and paying redundancy payment to employees. However, Aussie Ltd. has shown efficiency in investing sincere efforts to averting risks through increasing spent on advertising campaigns. In addition, company has taken significant step through seeking Australian public to petition parliament in this return. In this way, Aussie Ltd. has invested sincere efforts in influencing public opinion for averting risks of high import duty. For dealing with taxation related issues, it is essential for Aussie Ltd to comply with Income Tax Assessment Act of 1936 and Income Tax Assessment Act of 1997 so that tax governances effectiveness level can be increased. In addition, it is essential to follow tax governance related principles of Australian Taxation Office. Australian taxation is associated with various principles with respect to deductible expenses of taxpayers. These principles of Australian Taxation Office need to be dealt in an efficient manner so that company can conduct its business activities without facing any issues associated with non-compliance with existing legal framework. First of all, it is essential to understand tax obligations along with various aspects, such as reporting and payment (Bell Hindmoor, 2014). In addition, it is essential to gain understanding on responsibilities pertinent to tax governance, administration and decision-making. Business owners need to understand taxation system related risks along with super obligations. Second, it is necessary to ensure the efficacious application of controls and processes so that compliance with super obligations and tax can be supported (Besley Persson, 2014). It is also important to identify and mitigate commercial tax related risks through including tax considerations into the process of tax-decision-making. After the identification of commercial tax related risks, it is essential to ensure efficacious management of tax related risks so that their impact on business can be limited. Third, it is essential to seek advice from Australian Taxation Office in case organisations feel need assessing tax outcomes for business (Braithwaite, 2017). Moreover, advice can be sought from tax professionals and advisers so that they can provide business organisations with efficacious counsel regarding the implementation of tax risk management system. Fourth, it is essential to maintain integrity in record keeping practices. At the same time, it is essential to align tax position with existing legal framework so that tax outcomes can be reflected in economic performance (Burkhauser, Hahn Wilkins, 2015). As per Income Tax Assessment Act of 1936 and 1997, it is essential to keep records and provide tax related information apart from the payment of instalments, income tax and tax related obligations (Dabner, 2015). Fifth, business organisations need to adopt transparent and professional working relationship with Australian Taxation Office so that seamless working relationship can be created for resolving issues associated with taxation and taxation related disputes can be avoided (Devos, 2014). Sixth, tax governance can be demonstrated through meeting tax related obligations. In addition, it is important to set timeframes for tax payments and lodgements (Kenny, Blissenden Villios, 2015). Management of tax liabilities can bring about effectiveness in taxation governance and management system (Doran et al.2013). Seventh, it is essential to resort to conducting ethical and responsible behaviour so that honesty and integrity can be maintained while maintaining effectiveness in tax governance along with maintenance of accuracy in reporting (Dwyer et al. 2013). However, at the same time, it is essential to ensure avoidance of tax manipulation and avoidance related behaviours (Eccleston Woolley, 2014). In order to deal with issues faced by the respective organisation, the management level needs to consult with tax consultants or Australian Taxation Office so that tax related matters could have sorted out. Acquiring advice from tax consultants can help the concerned organisation in improving sustainability of business despite Governments decision of increasing heavy import duty on furniture (Hasegawa Kiyota, 2017). Failure in maintaining accuracy in reporting has played significant role in creating average effectiveness in tax governance (James, Sawyer Wallschutzky, 2015). Otherwise, tax manipulation and avoidance related behaviours could have been avoided. Application Based on the discussion associated with issues of finance principles, sincere efforts can be invested on the identification and application of relevant legal principles with reference to case study. For dealing with importing goods in Australia, it is essential for Aussie Ltd. to follow certain legal guidelines framed by Australian Trade and Investment Commission. For example, Australian export and import related legislation needs to be followed for maintaining sustainability in business operational activities (Martin, 2013). As per guidelines of Australian Trade and Investment Commission, any business in Australia needs to comply with import related regulations with the help of which, business can meet its goals. In addition, compliance with Australian Trade and Investment Commissions guidelines can also be helpful in proving locally unavailable goods to customers (Long, Campbell Kelshaw, 2016). It is essential for Aussie Ltd. in getting to understand appropriate tariff classification for goods. Apart from this, understanding on valuation of goods for custom duty taxes can also be helpful for improving business profitability (Pamungkas et al. 2014). As per Trade Practices Act of 1974 and Income Tax Assessment Act of 2016, it is essential for every business to pay a certain amount of Australian Dollars in the form of import duty and Goods and Services Tax, i.e. 200 Australian Dollars. Import entry and processing related charges are also included in this charge. In addition, it is essential to import duty Every organisation needs to comply with Australian Securities and Investments Commissions Act of 2001 with the objective of protecting consumers of goods and services. In addition, direct complaints can be lodged in case of average products performance. Australian Free Trade Agreements and Australian Governments commitment under World Trade Organisation with respect to Tariffs and export-import subsidies should be taken into consideration by Aussie Ltd. so that improvement in tax governance can be ensured (Rootes, 2014). In the case of Commissioner of Taxation v Australian Building Systems Pty Ltd (in liq) [2015] HCA 48, it has been shown that this case played significant role in providing certainty to receivers, administrators and liquidators in facing no obligations in retaining amounts out of proceeds of companys asset sales on account of payable tax as per section 254 of Income Tax Assessment Act of 1936 (Robson, 2014). In addition, this legal case also laid stress on drafting Australian Taxation Offices tax determinations on this issue. In this legal case, it has been determined that in case of absence of assessment, liquidator is not liable to retain funds from the sale of assets with the objective of meeting payable tax liability in the form of capital gain on sale. For dealing with this taxation related issues associated with taxation, Aussie Ltd. needs to take into considerations these above mentioned legal principles, legal case law and legislations. Compliance with these aspects associated with trade and taxation related legislations and principles will help Aussie Ltd in dealing with import duty related issues. Roles and responsibilities associated with accountability on tax decision-making and administration need to be clarified and understood for improving business operational efficiency (Saad, 2014). Furthermore, understanding on these above mentioned legal aspects associated with trade and taxation can be helpful for concerned organisation in mitigating tax risks and meeting tax related obligations. These can be helpful in bringing about effectiveness in auditing system. An auditor must be appointed in concerned organisation, which possesses knowledge on code of ethics associated with accounting bodies (Sharma et al 2014). Accounting Pr ofessional and Ethical Standards Board related principles need to be understood in order to maintain effectiveness in business taxation and accounting related principles so that credibility in business can be maintained. Development of auditing strategy will be helpful in improving effectiveness of detection and control risk level. An auditor can play significant role in assessing control risks. Through developing internal control strategy risks associated with auditing and taxation can be minimised. In addition, effectiveness can be maintained in management decision making thereby resulting in making business proves effective. Effective level of internal control can also play significant role in ensuring that business transaction can be carried out in accordance with authorisation of management. Australian Auditing Standards Compliance with Corporations Act 2001 will be utilitarian for concerned company in maintaining effectiveness in business operations. In order to mitigate business risks, it is essential to ensure that management controls can be strengthened. Business risks can be mitigated through monitoring business risks. Along with it, the policies associated with these risks need to be defined in such a manner that concerned company can strengthen its defence against business risks. In this way, business profitability level can be increased. It is essential to perform certain control related activities, such as accounting with respect to transaction related sequence, calculations associated with transactions, setting lists of prices, determining limits of credit for sales and so on (Smith, 2016). It is also essential to ensure review of subsequent payments. Independent review associated with business transaction around balance data of account coding can play significant role in improving effectiveness of current account practices of concerned company, i.e. Aussie Ltd. From above discussion, it can be understood that taxation is significant role player in the context of a company, country and overall economy. For making discussion analytical, descriptive and informative, various legal case examples have been cited along with legislations. It has been inferred from diametrical discussion that it is very important to gain understanding on taxation related concepts for improving business profitability. A countrys Government would able to mobilise substantial amount of revenue with the help of taxation. Reduction in income inequalities can be ensured through following taxation related policies. In the context of regional development, taxation is significant role player. Aussie needs to make arrangements for ensuring that its audit related policies are assessed in every year with the help of auditors and auditors must be key role players in the context of ensuring the identification of business risks. Performance of tax governance system can be monitored through the optimal utilisation of performance indicators as well as benchmarking. In this way, Aussie Ltd. will be able to improve business performance and strengthen its position against Australian Governments decision on imposing high level importing tax. At the same time, it is required to lay emphasis on consulting with tax consultants so that it can be understood what measures should be adopted for improving effectiveness of tax governance. The given legal case and legislations along with legal principles will be helpful in improving business performance of concerned company. In addition, effective implementation of the auditing process can be helpful in improving financial profitability and effectiveness of business operations thereby resulting in making business entity less vulnerable to business and accounting related risks. The mentioned case study, legal principles and legislations will be helpful for concerned business entity in getting to understand nature of business risks and what appropriate measures ought to be adopted for improving business performance. It will also be helpful in dealing with Governments with respect to importing duty and it can be expected that Government may consider decreasing import duty in future for the sake of globalised business. Apart from this, media attention needs to be attracted for From given case study, it has been inferred that James has faced various problems purchasing a block of five flats, such as improper maintenance, plumbing and roofing. Because of the occurrence of these issues, James had to spend a lot of money so that preventive measures can be taken for improving condition of building. However, at the same time need for dealing with tax implication has been arisen, which is necessary for ensuring sufficient rate of return against investment with respect to building purchasing. For dealing with tax implications associated with incurred expenses, it is essential to follow process and procedures associated with auditing in an effective manner. It is necessary for concerned business entities to follow effective auditing process with the objective of improving effectiveness of accounting and business practices. Initially, concerned business entity needs to assess risks of associated with building development process (Taylor Richardson, 2013). After tha t, it is essential to perform thorough analysis with respect to building development and purchased based on which potential risks can be identified and assessed in a critical manner. Control and other process associated with the procedures of addressing risks can be assessed thereafter. Analytical procedures need to be implemented for improving for getting to understand nature of risks. Effectiveness of control procedures needs to be assessed in a critical manner. Entire auditing process can be communicated to different users for the purpose of validating its effectiveness. For illustrating discussion on statutory deductions- be it general or statutory, it is essential to gain understanding on certain things, such as PAYG Withholding and Higher Education Scheme, Income Tax, Medicare Levy and so on. As far as PAYG Withholding and Higher Education Scheme is concerned, employers are the significant role players in this context since they withhold additional amount from remunerations and wage income in order to cover compulsory repayment. PAYG or Pay As You Go is an instalment system according to which, it can be possible to make regular payments towards expected tax liability in case of improvement in investment income (Yu-ling Bureau, 2015). Tax can be paid in instalments throughout the year and it is not necessary to take measures for lodging tax return. At the time of making PAYG instalments, it is essential to take debt into account. For individuals, it is required to ensure payment of instalments in case of payment of 4,000 Australian Dollar (Gilley, 2017). PAYG instalment obligations can be managed and paid through online mode and website of Australian Taxation Office needs to be used for paying online instalment obligations. In Australia, it is essential to pay income tax on a certain amount of taxable income. If a person earns or possess property worth more than 87,000 Australian Dollars, 22.78 to 30.13 percent income tax can be incurred. For dealing with income tax related issues, it is essential for James to gain understanding on income tax related information applicable in Australia. Through gaining knowledge on taxation, James can be enabled in complying with existing legislations associated with purchase of building. For gaining knowledge on income tax, it is essential for people to gain understanding on different aspects of Income Tax Assessment Act of 2016 (Collins, 2017). In addition, Australian Taxation Office can be consulted in this regard so that sufficient and satisfactory counsel can be acquired with respect to taxation system. Medicare Levy can be taken into considerations for getting to understand importance of healthcare and health maintenance at the time making purchase of fixed assets like building purchase. A person or tax payer needs to pay 2 percent of total taxable income in the form of Medicare Levy (Apps, Long Rees, 2014). It is regarded as progressive income tax related levy, which plays significant role in financing Medicare. In this context, it can be said that Medicare is one of the prominent national healthcare related scheme. Apart from statutory deductions, there are general deductions too and they are not considered as beneficiary. In this context, example of charitable deductions and garnishments can be cited. These deductions are not considered valuable in terms of achieving commercial purpose. As far as capital expenses are concerned, it is considered as an amount, which is spent to acquire long-term asset, such as buildings. For dealing with capital expenses, like building purchase, it is essential for James to understand valuation of building before making purchase. Based on understanding associated with valuation of building, James can opt for purchasing buildings. Profit earning capacity can be improved with the purchase of fixed assets like building (Mates et al. 2016). In addition, purchase of fixed assets like building can make James beneficiary in terms of acquiring and ensuring revenue generation. Conclusion From entire discussion, it can be understood that capital expenses and deductions need to be taken into considerations in order to make purchasing process of fixed assets effective. Auditing process and risk analysis process can be implemented with the objective of improving financial profitability. In addition, it is important to perform risk analysis with the objective of averting any kind of risks at the time of making purchase. Therefore, principles of capital expenditure and deductions need to be taken into considerations for improving business profitability level. James needs to take into considerations these aspects along with existing legal framework. It will be utilitarian for James in getting to understand importance of taxation and deductions at the time of making purchase of fixed assets. Effective tax governance system can be helpful in controlling inflation too. For dealing with taxation governance related issues, it is essential to deal with effective business and corp orations related legislations and principles. Taxation plays significant role in ensuring that foreign exchange can be earned through promotion of exports. In addition, social welfare can be promoted and generated through taxation and its role in undeniable when it comes to matter of ensuring economic development. 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