The Government will legislate to ensure that organisations whose main activity is promoting the prevention or control of disease or illness in people can continue to access important tax benefits. These organisations are integral in promoting good health in Australia and make a significant contribution to educating Australians about matters such as diet, lifestyle and disease.
To date these organisations have been considered public benevolent institutions (PBIs) and were therefore exempt from Fringe Benefits Tax and able to accept tax deductible gifts. However over time, their activities may have changed such that they may no longer be considered to be PBIs. This is because their principal activity may now be indirectly rather than directly relieving, for example, sickness distress or suffering. Without legislative amendment, these organisations would lose access to these tax benefits.
In view of this, the Government will legislate to ensure that these organisations will retain their FBT exemption and will continue to be able to accept tax deductible donations. The amendments will have retrospective effect to ensure that there is no break in the eligibility of these organisations to these benefits.
In addition to these benefits, these organisations will continue to be income tax exempt as they retain their status as charitable institutions. While not relevant after 1 July 2000, the Government will also legislate a sales tax exemption for these bodies (consistent with the exemption available to PBIs).
Legislation to implement the Governments decision will be introduced into the Parliament as soon as is practicable.