CAANZ questions whether advances in technology and transport have diminished hardship in remote areas to such an extent that it no longer considered worthy of being compensated. Harsh climatic conditions, telecommunication difficulties, poor quality accommodation and food, and lack of opportunities to socialise make working in remote areas hard. This is evidenced by the high vacancy rates, low staff retention, transient population and diminishing population in those areas.
CAANZ recommends that, rather than abolish or dramatically curtail remote area tax concessions, that the Productivity Commission consider adopting ABS definition of remoteness (with potential modification for the special circumstances facing Darwin) for the purposes of the zone tax offset and some FBT tax remote area tax concessions as it would:
- Target remoteness more directly;
- Allow boundaries to be regularly adjusted every 5 years to reflect contemporary definitions of remoteness; and
- Make the process for determining boundaries transparent
- provide consistency that has the potential to reduce complexity and compliance cost