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The inherent disincentive of the Child Care Subsidy

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Published on 01 Apr 22 by "TAXATION IN AUSTRALIA" JOURNAL ARTICLE

As a part of our transfer system, a fair, efficient and effective Child Care Subsidy (CCS) plays an important role in incentivising workforce participation, increasing Australia’s productivity and reducing discrimination against primary carers. The various components of the current CCS, including the current rates, the hourly rate cap and the activity test, all work together to create disincentives within the system, effectively capping the productivity gains which result. Getting the CCS balance wrong results in lost access to valuable employees to provide the necessary services across our economy, increasing labour shortages and wage pressures beyond what we are already experiencing. Getting the balance right, unlocks the potential of not only increased productive hours, but also the knowledge of more individuals who can bring new ideas and concepts to the table which can only ever help Australia improve as a country.

Author profile

Scott Treatt CTA
Photo of author, Scott TREATT Scott Treatt, CTA, CEO, The Tax Institute Scott brings a wealth of experience in tax practice, tax administration, and leadership to the role of Chief Executive Officer of The Tax Institute. Scott’s career as a Chartered Tax Advisor has spanned large and mid-tier professional firms and Government in technical and leadership roles. A dedicated member of The Tax Institute for over 20 years, Scott has contributed significantly to the knowledge of members and the betterment of Australia's taxation and superannuation system overall. Scott was previously the General Manager, Tax Policy and Advocacy, at The Tax Institute, leading its tax technical team for three years. During this time, he proactively enhanced the team’s capabilities, orchestrated a successful overhaul of the various committees and councils to improve the representation of our members, built strong relationships with key stakeholders across the industry, academia, and all levels of Government, and drove the Institute’s growing influence in policy and advocacy circles. He is a passionate advocate for holistic tax policy reform and is a visionary business leader known for his forward-thinking approach. A commitment to strategic cross-team collaboration, good governance, a strong dedication to member empowerment and development, and an unwavering pursuit of excellence in every aspect of the business characterises Scott’s leadership style. Under Scott’s guidance, The Tax Institute is poised to provide employees and members with clear guidance, adeptly turning challenges into opportunities and catalysing sustainable growth. - Current at 18 October 2023
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