Explanatory Memorandum(Circulated by authority of the Treasurer, the Rt. Hon. William McMahon.)
The first Bill - the Income Tax Assessment Bill (No. 2) 1967 is designed to give effect to certain proposals concerning the basis upon which tax is assessed. In broad terms, the main points of the Bill are :
- Dividend Withholding Tax (Clauses 7 to 15).
- The dividend withholding tax on dividends derived by non-residents on or after 1st July, 1967 is to be made a final tax by withdrawal of the option non-residents now have to elect to be taxed on dividends on an assessment basis.
- Dividends derived by residents of all Australian external territories on or after 1st July, 1967 will be excluded from the dividend withholding tax and taxed on an assessment basis.
- Agreements with the United States of America (Clause 4).
- Exemptions similar to those granted in pursuance of the North West Cape Naval Communication Station Agreement and the Status of Forces Agreement with the United States of America are being authorised to give effect to two subsequent agreements made with the United States Government - one relating to the Joint Defence Space Research Facility and the other to the undertaking known as the Sparta project.
- Deductions for Share Capital subscribed to Prospecting and Mining Companies (Clauses 5 and 6).
- The operation of sections 77A and 77AA of the Principal Act which authorise deductions, in specified circumstances, for share capital subscribed to prospecting and mining companies is to be extended for a further period of three years.
The clauses of the Bill are explained at pages 3 to 15 of this memorandum.
The second Bill - the Income Tax (International Agreements) Bill 1967 - proposes consequential amendments to the law concerning foreign contractors to whom the two additional agreements with the United States Government referred to above relate.
Explanations are given at pages 16 to 17 of this memorandum .
The third Bill - the Estate Duty Assessment Bill 1967 - is designed to extend exemptions granted in pursuance of the North West Cape Naval Communication Station Agreement and the Status of Forces Agreement with the United States of America to give effect to the agreement with the United States Government concerning the establishment of the Joint Defence Space Research Facility in Australia.
Explanations of the clauses are provided at pages 18 to 21 of this memorandum.
The fourth Bill - the Gift Duty Assessment Bill 1967 - will effect amendments in the gift duty law, corresponding to those to be made for estate duty purposes, for the implementation of the agreement with the United States Government concerning the Joint Defence Space Research Facility in Australia.
Explanations of the clauses will be found at pages 22 to 24 of this memorandum.