The issues paper focuses on modernising fringe benefit tax (FBT) rules, particularly for motor vehicles and unclassified benefits. While recognising current fiscal constraints, CA ANZ supports reform in these areas.

CA ANZ’s key submissions on motor vehicles include:

• Retain the tax book value option for valuing private use of motor vehicles.
• Truncate the proposed new cost-based valuation rates and clarify how they apply across mixed vehicle types (petrol, diesel, hybrid, EVs).
• Align the vehicle benefit valuation review period with a five-year useful life.
• Refine the proposed motor vehicle categories to reflect common business-use scenarios, such as weekday business and weekend private use.
• Clarify if signwriting is compulsory for FBT-exempt vehicles and define terms like “predominantly” and “incidental private use.”
• Provide guidance on when a “material” change in vehicle use triggers reclassification.
• Review and regularly update the $80,000 cost threshold for shareholder-employee vehicles and expand eligibility for using motor vehicle deduction rules.

On unclassified benefits:

• Support Option One: a remuneration test with a higher cap per benefit.
• Publish guidance on benefit aggregation and retain the on-premises exemption.

Entertainment tax:

• Recommend not folding entertainment tax into FBT. Any changes should follow full GTPP consultation.