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  • Consultation Steering Group key messages 17 November 2016

    Future of the tax and BAS profession consultation

    Consultation on the Future of the tax and BAS profession is intended to be an ongoing stakeholder relationship group. It aims at gaining a joint understanding of the required capabilities and system required to support the tax profession over the next 2 to 5 years. It would refer specific matters for consultation to working groups which would report back to it. The need for an ongoing group was questioned and whether reporting could go straight back to the Tax Practitioners Stewardship Group.

    Action item CSG 1611/1 - Future of the tax and BAS profession consultation group as an ongoing stakeholder relationship group
    Consider whether there is a need for the stakeholder relationship group to be an ongoing stakeholder relationship group or if the Tax Practitioners Stewardship Group could fill this role.

    Treasury update

    • Current consultations: debt/equity exposure draft: Collective Investment Vehicles withholding; and GST on low value imports.
    • Upcoming consultations include register of approved occupational clothing; increasing penalties for significant global entities; and superannuation – regulations.
    • A consultation paper on tax and corporate whistle blower protections is expected to be issued in December 2016 with feedback by February 2017.
    • Treasury noted that for diverted profits tax it is possible that limited consultation will occur before its introduction to Parliament.

    Action item CSG 1611/2 – Timeframe for introduction of consolidation and Division 7A amendments
    Treasury to provide an out of session update on the timeframe for introducing the legislation.

    Board of Taxation update

    The Board continues to issue a newsletter after Board meetings.

    The Board has received mixed messages on areas of concern within the tax system. For example only nine out of 40 organisations responded on the topic of inconsistent definitions in state and federal tax laws.

    The Board noted a low level of engagement generally with the Sounding Board. The level of engagement with an issue will help decide its priority. The numbers of respondents is not the only factor but is relevant. Board is considering creating a new category for items that have not received much support after six months. The Board needs ideas by February to enable them to be included in a Regulatory reform bill that would be introduced in August.

    Action item 1611/3 - Push notification service from the Sounding Board
    Investigate whether a push notification service is available from the Sounding Board.

    Report on ATO consultation activity

    Overview 

    Report provided an update on consultation activities between August to October 2016 including Stewardship group meetings, new matters raised and closed, changes to special purpose and stakeholder relationship groups. A number of suggestions received from ATO officers regarding improvements to the consultation process that could be put in place. Most of the learnings apply to the ATO.

    New matters (16) 

    Matters registered August to October 2016

    201640 - Petroleum resource rent tax – Deductibility of social infrastructure expenditure

    201641 - Petroleum resource rent tax – Closing-down expenditure

    201642 - Petroleum resource rent tax – Reversion of licence

    201643 - The application of section 99B of the ITAA 1936 to trust capital gains

    201644 - Taxation of capital gains of a non-resident beneficiary

    201645 - Key taxpayer engagement

    201646 - GST and Hep-C medicines

    201647 - Remaking Excise legislative instruments

    201648 - Correcting GST Errors Amendment Determination

    201649 - A fairer approach to penalties

    201650 - Division 50-50 Special Conditions

    201651 - Government specific FBT web content

    201652 - Exploration expenditure deductions - ATO compliance approach

    201654 - Tax treatment of retail premiums received by resident and non-resident shareholders in a renounceable rights offer

    201655 - Improving Online Services for tax practitioners

    201656 - Building and construction industry – Recognising the signs of business failure and taking action

    Completed matters (18)

    Matters completed August to October 2016

    201338 - Application of new transfer pricing laws (Division 815)

    201495 - Branch Attribution: s820-300(3) Authorised Deposit-taking Institutions (ADI) Equity Capital and Controlled Foreign Entity Equity

    201509 - Safe Harbours – GST

    201513 - Safe harbours – Tax and accounting

    201519 - Petroleum resource rent tax (PRRT) – Deductible expenditure

    201547 - Foreign investment reforms

    201548 - Record keeping requirements for foreign general insurers

    201557 - Marketing Hubs – practical guide

    201569 - Proposed public ruling – The deductibility of legal expenses under section 8-1 of the Income Tax Assessment Act 1997

    201601 - Green certificates

    201609 - Legal database

    201614 - Regulation and the sharing economy – getting the balance right

    201622 - Partnership Framework

    201623 - Understanding and improving the Division 293 tax client experience

    201637 - Assistance for drought affected farmers

    201646 - GST and Hep-C medicines

    201647 - Remaking Excise legislative instruments

    201648 - Correcting GST errors amendment determination

    Matters in progress >12 months (4)

    201529 - Domestic travel allowance expenses

    Consultation paper has been issued on substantiation exceptions for reasonable travel allowances with comments due by 22 November 2016. A revision of the travel allowances ruling is planned to be published by June 2017.

    201545 - Lease-in Lease-out (LILO) arrangements

    A taxpayer alert was issued in April 2016 highlighting areas of concern. It is a complex matter involving withholding taxes, transfer pricing and permanent establishment attribution issues. Revised guidance expected to be released soon with planned consultations to include industry associations.

    201567 - Common Reporting Standard (CRS)

    Collaboration continues between ATO and Treasury on policy and design with consultations being undertaken with those affected by reporting standards, using the ATO’s Let’s Talk website and the Software Industry Partnership Office. The design of strategic communications, including an awareness campaign and an issues register are a priority.

    201568 - GST treatment of ‘home care’ and ‘residential care’ services

    The community is seeking further guidance as services are now delivered with a more direct client focus approach. We have been consulting with leading associations and the Department of Health. Draft fact sheets to be published in December 2016 for comments by February 2017.

    Spot check on matters (2)

    201609 - Legal database

    Consultation to date has provided insights on areas to prioritise such as database search ability and speed. An interim solution for improved search implemented in October 2016 with planned improvements by February/March 2017. Consultation worked well and has been finalised.

    201645 - Key taxpayer engagement

    The consultation date of completion has been extended to enable consideration of:

    • links to other business initiatives such as the justified trust, reportable tax position, corporate tax governance issues
    • changed thoughts on dealing with the annual compliance arrangements.

    Potential new ways to consult

    Currently using ATO’s Let’s Talk, telepresence rooms and WebEx for webinars. Suggestions included:

    • new tools such as Skype for Business as more organisations adopt Microsoft Office 365 package
    • exploring new consultation tools used in other authorities, eg HM Revenue & Customs.

    CSG action items

    It was agreed to close the following action items:

    • CSG 1605/6 – Franking Dividend Declarations – suggestion to include an example on the ATO website on how the franking dividends account would need to be declared next year.
    • CSG 1608/1 – Consultations on taxpayer alerts.

    Other business

    Review of the Consultation Steering Group (CSG)

    We will be seeking feedback from CSG members on the operations and effectiveness of the Group to identify potential areas for improvement. Review to be undertaken before the next CSG meeting on 23 February 2017.

    Action item 1611/4 – Review of Consultation Steering Group
    The ATO will seek feedback from CSG members on the operations and effectiveness of the Group.

      Last modified: 23 Jan 2017QC 50933