Invited by the Australian Financial Review to contribute to its pre-election series of policy pitches by prominent Australians, senior partner Mark Leibler AC has made a pitch to the major political parties to make childcare fully tax-deductible.
“Over the years, when I’ve been asked questions like this, I’ve talked about the critical features of the tax system or the GST. This time, I decided I wanted to focus on something that was real and doable and important.”
Mark explains that the non-deductibility of childcare expenses is based on a High Court decision going back half a century, which found that these expenses were neither relevant nor incidental to gaining or producing assessable income, and were therefore not an allowable deduction.
“The ongoing legacy of this case is that it disproportionately impacts adversely on working women.” Mark says.
While Arnold Bloch Leibler is currently running a test case to change this archaic law, Mark says that legislation is the gold standard – “I would love to see the major parties actually committing to amend the legislation to put tax deductibility of childcare on the table.”
The article was prepared with assistance from special counsel Bridgid Cowling and lawyer Eileen Liu.
