Training in the civil construction industry will be devastated by a State Government decision to remove a payroll tax exemption for existing workers undertaking traineeships.
Civil Contractors Federation (WA) CEO Jeff Miller said the decision, which only affects traineeships and not apprenticeships, unfairly targeted certain sectors including civil construction.
“Coming from a Government that has declared it is focusing on local jobs, this is a bitter blow,” Mr Miller said.
“It is especially disappointing to see the existing payroll tax exemption being described today by the State Government as a ‘loophole’.
“How is a tax exemption for a civil construction trainee a loophole, while the same exemption for a building apprentice is not? Both are Certificate III-level trade qualifications.”
Mr Miller said the Government was sending mixed messages to the civil and infrastructure construction industry.
“On the one hand we are being told it wants to see higher rates of training in the construction workforce so as to ensure a sustainable workforce,” he said. “On the other we’re being told that the payroll tax exemption is ‘not targeting real skills gaps’. If there are no skills gaps in construction, why have a policy mandating training targets?
“There are companies in our industry doing the right thing, training workers to create a more skilled construction workforce, that will be forced to cut traineeships by this decision. Construction training subsidies must be increased to ensure these employers aren’t disadvantaged.
“We understand the Government’s intention is to crack down on a handful of employers it perceived were gaming the system. But this decision will affect hundreds more companies that are training their people for all the right reasons.
“We look forward to hearing more detail from the Government on ‘Stage 2’ of the changes, which will apparently involve a new grant scheme, but in the meantime, our industry will suffer. The transition to a new scheme could surely have been achieved without throwing civil construction training into limbo.”
About the changes
Effective from December 1, 2017, payroll tax exemptions will be limited to all apprenticeships, and to traineeships undertaken by new employees earning no more than $100,000 per annum at the date of lodgment of the contract with the Department of Training and Workforce Development.
Existing worker contracts lodged before December 1, 2017 will continue to be exempt providing the employee’s annual wages do not exceed $100,000.