Shadow treasurer Joe Hockey has promised to abolish tax rules that have been blamed for holding back the Australian start-up scene if a Coalition government is elected in September.
The rules, introduced by the Labor Government in 2009, require employees to pay taxes on share options immediately. Critics say they force cash-strapped employees to prematurely exercise their options and sell their shares.
Hockey told BRW’s Nassim Kadem that Labor’s employee share option tax rules had put a “massive handbrake on start-ups”, promising that a Coalition government would wind back the policy in its first term.
“So many start-ups have remunerated their senior employees with share options and the Australian Tax Office is now hitting them with a tax liability for what they may receive, rather than actually what they have received,” he told BRW.
People want skin in the game. Everyone hopes to be part of the next start-up Apple, start-up Microsoft or the start-up Google.”
There’s more on BRW.