I was encouraged to investigate the matter after one of the clubs that I am a member of, was assessed for a taxation payment of $6,000 for the 2023/24 year. Not-for-profit groups are now required to pay tax on any profits over $416 or any funding that is contributed for the direct benefit of the members. In the above case the group provided a small subsidy for the annual membership fees.
I commenced my investigation by contacting a number of groups that I am a member of, to see if they were aware of these new taxation requirements. To my dismay almost all had no idea that these laws had been introduced.
In 2023 a report was issued by Prof. Ian Hickey advising that collectively, volunteer contributions to Australia’s social prosperity were valued at $287.86bn, equating to 14% of Australia’s GDP in 2021.
During my investigations I received adverse reactions from a number of volunteers who have taken exception to the requirement to provide their myGov details to confirm their identity. Many have stated that they will simply resign. These new regulations require one person to accept responsibility for reporting and compliance for a community group which will almost certainly be managed by a committee. It is suggested volunteers will find this ‘all too hard’ and we will see a massive drain from this valuable resource. These taxes will go down in history as being the greatest disincentive for volunteers that Australia has ever seen.
Further investigation took place and to my dismay the whole process of the introduction was an absolute debacle. I assembled the information that I had, and sent a copy of this to our local MP Dr. Helen Haines on 12th September. She assessed the content and then forwarded a copy to the Federal Treasurer Dr. Jim Chalmers, on the 16th September, asking him what could be done about the issues that I had raised.
After almost a month an undated response was received from the Assistant Treasurer, Andrew Leigh on the 18th October. This reponse did not address any of the issues raised which will have adverse impact on the community, but simply stated the details of the current regulations. It was simply a ‘go away and don’t annoy me’ response.
Following this I received some further information about the processes introduced by the Federal Government. The main issue that arose from this was the fact that there was no provision within the regulations to allow for an off-set of volunteer hours contributed to running these community support organisations, any fundraising that they may undertake, or the time required to comply with the new taxation regulations. My response to this is:
Whilst the Federal Government is holding out its hand for the revenue raised, there appears to be no offset allowance for volunteer hours contributed, even at the minimal rate as assessed by the Governments in each state, each year. Does the Taxation Department think that somebody waves the ‘magic wand’ and the funds mysteriously appear in the community group’s bank account??
Three weeks ago a report from a Senate Inquiry was released which highlighted the issues that I had raised in my original submission of 12th September. However, the Senate report did not include the issue of off-set time allowance for volunteer input to community support functions.
The situation is perhaps encapsulated in a comment made to me recently by a fellow volunteer who said,
“I have no problems whatsoever volunteering my time for the benefit of the community, but having been a taxpayer all of my working life, I will not, under any circumstances, volunteer my time to raise money for the Taxation Department.”
I have prepared a media alert, highlighting the adverse impact on the community and other issues created by these new laws, which will be released to key media outlets and Federal Parliamentarians over the next two weeks.
To be continued………………..
Barry O’Connor.
14th November 2024.
References cited:
Ms Kristen Tran, A/Professor Jo-An Occhipinti, Professor John Buchanan, Dr Sebastian Rosenberg, Dr Christine Song, Professor Ian B. Hickie (2023) A Contributing Life: A Snapshot of the Value of Social Production The University of Sydney Brain and Mind Centre
Sydney University News (15 March 2023) - 'Australian unpaid social contributions valued at $287 billion'