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  • GST Stewardship Group record of meeting 18 May 2017

    Meeting details

    Venue: ATO Offices, Level 12 conference room 706, 52 Goulburn Street, Sydney

    Date: 18 May 2017

    Start: 9.30am Finish: 12.20pm

    Chair: Tim Dyce and Amy James-Velegic

    Secretariat: Alison Zeitlhofer, Indirect Tax; contact phone: 02 6216 1013

    Members

    Name

    Role/Organisation

    Tim Dyce

    Deputy Commissioner, Indirect Tax, ATO (Co-chair)

    Kate Roff

    Assistant Commissioner, Indirect Tax, ATO

    Gordon Brysland

    Assistant Commissioner, Senior Tax Counsel, ATO

    Giles Wilmer

    Director, Commonwealth Taxes Unit,
    Queensland Treasury

    David Pullen

    Indirect Tax and Not for Profit Unit, The Treasury

    Chris Plakias

    Head of Tax, GST and Technology Westpac,
    Member Australian Bankers’ Association

    Ken Fehily

    Principal, Fehily Advisory, Member CPA Australia

    Andrew Howe

    Director, Greenwoods and Freehill  Pty Ltd,
    Member Property Council of Australia

    Bastian Gasser

    The Tax Institute

    Professor Michael Walpole

    Professor and Associate Head of School (Research),
    School of Taxation & Business Law, University of NSW

    Guest attendees

    Name

    Role/Organisation

    Amy James-Velagic

    Assistant Commissioner, Indirect Tax, ATO

    Apologies

    Name

    Role/Organisation

    Kevin O'Rourke

    Chartered Accountants Australia and New Zealand (Co-Chair)

    Andrew Sommer

    Partner, Clayton Utz
    Member Law Council of Australia

    Paul Suppree

    Assistant Director, Corporate Tax Association

    George Nikolaou

    Coles Finance

    Agenda summary

    • Welcome
    • Overview of 2017 Budget measures relating to GST administration
    • Private advice / follow up on private advice discussion
    • Update on industry in terms of new developments / business models
    • Next steps summary and close

    Discussion summary

    Welcome – Tim Dyce

    Tim Dyce opened the meeting.

    Action items from 15 February 2017 were updated.

    Revised input Tax Credit (ITC) estimator guidance is expected to be published at end May 2017. Based on the feedback provided, the ATO has updated the guidance to be more practical and focus on helping businesses understand what are the risks associated with ITC estimators and with how to undertake reviews where a client has implemented an ITC estimator. The ATO has also refined the example to be easier to understand.

    Overview of 2017 Budget measures relating to GST administration – David Pullen

    David Pullen led a discussion on the GST related measures from the 2017 Federal Budget, which included:

    Tax Integrity Package – improving the integrity of GST on property transactions. From 1 July 2018, the Government will strengthen compliance with the GST law by requiring purchasers of newly constructed residential properties or new subdivisions to remit the GST directly to the Australian Taxation Office (ATO) as part of settlement.

    Tax Integrity Package – combatting fraud in the precious metals industry. The Government is amending the GST law to give effect to changes that were announced on 31 March 2017 and take effect from 1 April 2017. The changes provide that entities buying gold, silver and platinum that have been supplied as a taxable supply for GST purposes will be required to apply a reverse charge. The reverse charge shifts the liability for the GST on the supply to the recipient of the supply rather than the supplier. This results in the recipient essentially netting off their entitlement to an input tax credit for the supply with the GST payable on the supply. Changes are also made to clarify that gold, silver and platinum are not second hand goods.

    GST – removing the double taxation of digital currency. The Government will align the GST treatment of digital currency (such as Bitcoin) with money from 1 July 2017. This measure will ensure purchases of digital currency are no longer subject to the GST. Removing double taxation on digital currencies will remove an obstacle for the Financial Technology (Fintech) sector to grow in Australia.

    Black Economy Taskforce – one year extension of funding for ATO audit and compliance activities.

    Taxable payments reporting system – extension to include contractors in the courier and cleaning industries.

    Action item

    ID

    Due date

    Responsibility

    Action

    A – 18/05/2017

    Before next meeting

    Secretariat

    Provide information on how current Taxable Payments Reporting System operates.

    Private advice/ follow up on private advice discussion – Amy James-Velagic

    Amy James-Velagic led a discussion to update the 15 February meeting private advice agenda item. Given recent external feedback, the ATO is currently considering sunset and assurances clauses for indirect tax private advice.

    Concepts the ATO is exploring include whether sunset clauses would be appropriate where it is recognised that is highly likely that the specific factual scheme will change within a certain period of time. This may be the circumstance where the specific facts relate to rapid technology changes and organisational/business change.

    We are also exploring whether a voluntary option (subject to some form of assurance from the client) to extend private ruling application date would be beneficial.

    Members considered the benefits of a sunset or assurance clause for private advice. A number of circumstances were considered including:

    • Requirement for some form of an assurance clause or declaration was discussed.
    • Reminders to ascertain if the circumstances that led to the private advice being issued had changed or were still relevant.
    • Period of the sunset clause (4 years for certain circumstances was suggested by members).
    Action item

    ID

    Due date

    Responsibility

    Action

    B – 18/05/2017

    Next meeting

    Amy James-Velagic

    Provide an update at the next meeting on private advice sunset clause.

    Update on Industry in terms of New Developments / Business Models – Amy James-Velagic

    Amy James-Velagic led a discussion on new business models including the proposed agenda item (by David Pullen) for the next meeting in relation to commercial residential and serviced apartments. Members raised the characteristics of shared economy property renting/leasing and determining at what point does the arrangement change into commercial residential premises.

    Action item

    ID

    Due date

    Responsibility

    Action

    C – 18/05/2017

    Next meeting

    David Pullen

    Lead a discussion on hotels v serviced apartments.

    Next steps summary and close – Amy James-Velagic

    The meeting concluded at 12:20.

    Action item

    ID

    Due date

    Responsibility

    Action

    D – 18/05/2017

    Next meeting

    Amy James-Velagic

    Provide a copy of the Financial Services Industry Strategy to members.

     

      Last modified: 28 Jun 2017QC 52716