'Fame tax' faces hurdles
The Federal Government is looking to tax celebrities, sportspeople and entrepreneurs on money earned through their “fame or image”, but could face some challenges.
Assistant Treasurer Stuart Robert has announced a Treasury public consultation paper for new tax arrangements on income derived from a person's “fame or image” - money from sponsorships, endorsements, paid posts on social media and free gifts and events.
The tax measure aims to stop high-profile individuals from minimising the amount of tax they pay.
Those structures include licensing the use of a person’s image to a related entity and diverting income to that entity.
“This exploitation can consist of advertisements, sponsorships, including wearing associated brand products, public appearances and the promotion of products,” the Treasury paper noted.
The Government earlier announced it would impose the new measure from July 1, “without special transitional or grandfathering arrangements”.
Some have welcomed the proposals, but there is also concern that they would only make the laws more complex, and could lead some to move offshore to avoid the tax.