Preamble
An Employee Share Scheme is a scheme where employers offer shares or options to an employee in relation to their employment. Employee Share Schemes are designed to align employees' interests to those of the [issuing] company. In 2015 the Government made a number of changes aimed at improving the taxation treatment and administrative arrangements for Employee Share Schemes.

Terms of Reference
The Committee will inquire into the effectiveness of the 2015 Employee Share Scheme (ESS) changes and examine:

• how effective the changes in 2015 have been in their goal of bolstering entrepreneurship in Australia and supporting start-up companies; 
• the costs and benefits of these concessional taxation treatments, and deferred taxing points for options, to the broader community; 
• whether the current tax treatment of ESS remains relevant to start-up companies and whether any changes are appropriate to ensure the taxation treatment remains relevant; 
• how companies currently structure their ESS arrangements and how taxation treatment affects these decisions; and
• the challenges faced by companies in setting up an ESS arrangement and how the standard documents by the Australian Taxation Office (as introduced in 2015) assist this process and whether additional improvements should be made.