The Government will introduce legislation to set an effective life cap for the depreciation of trucks, truck trailers, buses and light commercial vehicles.
The Deputy Prime Minister and Minister for Transport and Regional Services, John Anderson, and Minister for Revenue and Assistant Treasurer, Mal Brough, jointly announced the new arrangements today.
"The statutory effective life caps will provide certainty for the transport industries concerned. It strikes an important balance between meeting industry needs, supporting the interests of the broader Australian community and maintaining the integrity of the effective life depreciation system," Mr Brough said.
The statutory effective life caps are as follows:
- 7.5 years for general and heavy haulage trucks
- 7.5 years for general, intercity and long distance buses
- 10 years for truck trailers
- 7.5 years for light commercial vehicles (including minibuses)
"The statutory effective life caps represent the maximum period over which depreciation deductions can be taken. A taxpayer will still have the option to self-assess the effective life appropriate to their own circumstances. In this way, the statutory cap acts as a 'safe harbour.'
"The statutory effective life caps will apply to purchases made on or after 1 January 2005, to coincide with the anticipated release of the Commissioner's determination increasing the effective lives of these assets," he said.
Mr Brough reaffirmed the importance of the Commissioner of Taxation's review of the effective life schedule to ensure it is modernised and updated to reflect current business practices.
Mr Anderson also announced that the Government had decided to delay the introduction of Euro 4 emissions standards (ADR 80/01) until 1 January 2007.
"The delay will ensure that necessary infrastructure support measures are in place at the time of the introduction of the standard," Mr Anderson said.
The original timeframe was to be 12 months following the introduction of the Euro 4 standards in Europe, however there has been a delay and those measures will not be introduced into Europe until late 2005.
Mr Anderson said the delay would give the states and territories time to increase the allowed front axle loadings for trucks using the new standard.
"Euro 4 compliant fuel systems can be up to 500 kilograms heavier than existing fuel systems, and the states and territories will need to come into line with the new standard, otherwise the ability of the trucking industry to meet our growing freight task will be reduced," he said.
"Both the Government and the industry are committed to a cleaner environment and the introduction of the Euro 4 standard, as stated in the Measures for a Better Environment agreement."
Media Contacts:
Mr Anderson's office - Clare Siddins - 02 62777680
Mr Brough's office - Carlie Hogan - 02 62777360