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Tuesday, 19 August 1969

Senator ANDERSON - The Treasurer has provided the following answer to the honourable senator's question:

(1)   and (2) Under the income tax law, the amounts actually expended by an employer on the keep of his employees are allowable deductions, and the value to each employee of the benefit he receives by way of keep is included in the employee's assessable income, in addition to his wages or salary.

There is no upper limit in either case. However, if detailed records are not kept of the amounts spent by the employer, it is the practice of the Commissioner of Taxation to allow a deduction of $2 per week for each employee. The Commissioner has found that this figure, which has been applied since 1951, provides an acceptable estimate in most cases. The majority of employees who are provided with keep are on rural properties where part of their food is produced by the employer. It is always open to the employer to demonstrate (if this is the case) that the amount expended was greater than $2 per week. If he does so, a larger deduction is allowed but the employee will, in this event, have to bear tax on the higher amount expended for his benefit.

The Commissioner does not propose any change in the current administrative practices.

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