Budget slashes FIFO tax break

Fly in, fly out workers will not be eligible for the Zone Tax Offset after the announcement of this year’s budget.

Fly in, fly out workers will not be eligible for the Zone Tax Offset after the announcement of this year’s budget.

By Courtney Pearson

13 May, 2015

FLY in, fly out workers will lose access to a tax break for remote-area living in a federal budget crackdown.

Starting from July, the move will save the Federal Government about $110 million per annum.

The Zone Tax Offset (ZTO) applies to taxpayers who live in a specific remote area for 183 days of the financial year, but many do not live in the area on a full-time basis.

“Excluding workers whose normal residence is not in these areas will better target the ZTO to the taxpayers who have taken up genuine residence within these zones,” the budget paper stated.

“For example, someone who lives with their family in Perth but has a FIFO job in the Pilbara will no longer be eligible to claim the ZTO.”

Australian Mines and Metals Association (AMMA) chief executive Steve Knott said the association would have preferred the offset not be abolished.

“FIFO employees may be well remunerated, however they fulfil an essential and often challenging role in our national economy,” he said.

“Those of us working in air conditioned CBD offices mustn’t lose sight of the 12 hour days they often endure, in far remote areas and while away from their families.”

The budget revealed that about one third of people claiming the ZTO lived outside the designated zones and did not “face the same challenges of remote living that the ZTO was designed to address”.

The ZTO was introduced to compensate remote residents for the disadvantage of “isolation, uncongenial climate and the high cost of living”.

“The people who are prepared to undertake FIFO work arrangements in order to get ahead are exactly the type of Australians the Treasurer is calling on – those who will ‘have a go’,” Mr Knott said.

“Any decisions on the financial support they receive must be very well considered.”