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Capping Self Education Deductions Is A Tax On Learning

12 Jul 13

The Real Estate Institute of Australia (REIA) says ongoing education is critical to performance through keeping abreast of developments in the industry and that capping deductions will stifle innovation.

REIA’s comments are in response to a discussion paper by Treasury and follow the 2013 Budget announcement of a proposal to cap work related education expense deductions at $2,000 from 1 July 2014.

REIA President, Mr Peter Bushby says, "In any one year, an agent will typically attend a Continuing Professional Development (CPD) course, local industry information sessions, seminars, discussion forums and conferences."

"Such self education is aimed at keeping the agent’s knowledge current on such things as changes in legislation, conduct laws, consumer law, industry developments, conflict management and court procedure," added Mr Bushby.

"There are different conduct laws in different jurisdictions and specific laws relating to property that are relevant to selling or managing rental properties (such as different laws relating to smoke alarms in residential premises) that will apply in different states and territories that a real estate professional needs to know about."

"Given that agents are entrusted to either sell or manage the biggest investment many consumers will make, it is necessary to ensure that those with that responsibility undertake ongoing education and professional development to ensure they retain their knowledge base."

"At a time when education has never been more important to improve productivity and economic growth, the proposed cap effectively imposes a tax on learning."

"It will be a disincentive to those seeking to maintain their skills base and knowledge and a consequence will be that professionals will invest up to the level of the cap and no more."

"This will have the most impact on those living outside the capitals required to attend courses and on women upgrading their skills and knowledge of the industry when returning to the workforce after having children."

"Standards, productivity and consumer protection will all be eroded," concluded Mr Bushby.