Australian innovators seek even playing field in attempt to reverse the brain drain
Australian innovators could be set to gain an advantage that will harness the right talent and facilitate growth within the local ICT sector as the Federal Government considers easing the rules on employee share schemes, aiding in a reversal of Australia’s brain drain.
“As the Federal Government considers changes to the employee share scheme rules, it’s imperative we see a significant revamp to the structure that extends to improving the growth conditions for mid-size technology businesses,” said Simon Coulton, National Head of Technology & Media, Grant Thornton Australia.
Mid-size technology businesses would considerably benefit from the use of a globally competitive employee share scheme as an important vehicle to combat wage inflation, while securing the best talent to grow with the business.
“We’re advocating for rules that will allow employees of mid-size businesses to elect when they are taxed. Such an amendment to our taxation legislation would result in a globally competitive situation where tax is payable at the time when employees exercise their rights to the share and have the opportunity to realise any gains, which coincides with a point in time where there is actually a tangible asset to tax.
“Mid-size technology businesses are at a crucial stage of growth and are often missing out on retaining key executives because the current rules are a huge disincentive to providing “skin the game” to employees who have skills attractive to a world-wide market. Changing the rules is an important step to creating an even playing field for our local ICT sector.
“We welcome an initiative that will help our technology businesses grow and prosper in the local market, instead of moving offshore to seek more competitive tax environments for both the business and its employees,” said Mr Coulton.
Anticipated changes to the current rules are expected following the release of the National Industry Investment and Competitiveness Agenda later this year. Businesses should consider current employee share scheme structures against any rule changes announced.
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