Allowance changes will hurt: inquiry

CHANGES to the living-away-from-home allowance will hurt businesses in regional areas and make it more expensive for people to relocate to remote areas for work, a submission to a parliamentary inquiry says.

The changes to the allowance were proposed as part of the Federal Budget 2012-13 in May, and were currently being investigated by the House Standing Committee on Economics.

If passed, the tax laws amendments would move the allowance from being assessed by the tax office under fringe benefits, to being part of general income tax, generating some $1.9 billion in extra tax revenue.

The Australian Constructor's Association, which represents some of Australia's biggest building and engineering firms, was one of 36 people or groups to send a submission to the inquiry.

ACA's submission said the changes could make it more expensive for business to attract and retain temporary residents, and impact the attractiveness of Australia in the international resource sector.

In particular, it highlighted the changes "may result in (resource) projects being delayed or shelved because of the inability to attract appropriately qualified employees".

The submission also said it could make it more expensive for businesses to relocate the domestic workforce, especially in remote and regional Australia, increasing costs.

Once the inquiry is complete, the committee will table the report in parliament for more consideration, but a date has not yet been set.

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