Explanatory Memorandum
(Circulated by the authority of the Treasurer, the Hon Wayne Swan MP)General outline and financial impact
CGT roll-overs for corporate restructures
Schedule 1 to this Bill modifies the capital gains tax (CGT) provisions in the Income Tax Assessment Act 1997 to prevent a market value cost base from arising when shares and certain other interests in an entity are acquired by another entity following a scrip for scrip CGT roll-over under an arrangement that is taken to be a restructure.
Date of effect : These amendments apply to arrangements entered into after 7.30 pm, by legal time in the Australian Capital Territory, on 13 May 2008.
Proposal announced : This measure was announced in the 2008-09 Budget by the Assistant Treasurer and Minister for Competition Policy and Consumer Affairs in Media Release No. 033 of 13 May 2008.
Financial impact : The financial impact of these amendments is unquantifiable.
Compliance cost impact : These amendments are expected to have a low compliance cost impact.
Amendments to assistance in collection provisions
Schedule 2 to this Bill amends the assistance in collection provisions found in Division 263 of Schedule 1 to the Taxation Administration Act 1953 . The amendments will overcome legal and administrative problems associated with deeming foreign tax debts 'never to have been payable' in the event that such debts are removed from the foreign claims register (Register) or otherwise reduced.
The amendments also expand the types of payments that the Commissioner of Taxation (Commissioner) can make to the foreign country to include certain funds that the Commissioner recovers in the course of legal proceedings (such as interest attributable to the debt and costs paid for by the foreign authority).
Finally, these amendments clarify that the role of the Register is to transform foreign tax debt into Australian tax debts rather than to act as a day-to-day record of the debtor's liability.
Date of effect : These amendments apply from the day after this Bill receives Royal Assent.
Proposal announced : These amendments have not previously been announced.
Financial impact : Nil.
Compliance cost impact : Low. These amendments are minor in nature and will have no impact on businesses.
Late payment offset for superannuation guarantee contributions
Schedule 3 to this Bill amends the Superannuation Guarantee (Administration) Act 1992 to vary the period within which an employer can make a superannuation contribution after the due date for a quarter and still elect to use the late payment offset to reduce their superannuation guarantee charge liability for the quarter. This amendment will encourage employers to make a contribution on behalf of their employee, albeit late, in a more timely manner closer to the original due date.
Schedule 3 also amends the calculation of the general interest charge on an unpaid superannuation guarantee charge where an employer elects to use the late payment offset.
Date of effect : These amendments commence from the date this Bill receives Royal Assent.
Proposal announced : These amendments relate to the measure announced by the Minister for Superannuation and Corporate Law in Media Release No. 014 of 20 March 2008.
Financial impact : Minimal.
Compliance cost impact : Low. These amendments affect employers who elect to use the late payment offset after the commencement of this Bill. There will be a low increase in compliance cost arising from the need for some employers to be aware of these amendments and to make a contribution before an assessment for the relevant quarter is raised.
Minor amendments
Schedule 4 to this Bill makes technical corrections and other minor amendments to the taxation laws. These amendments are part of the Government's ongoing commitment to the care and maintenance of the tax system.
Date of effect : These corrections, amendments and improvements generally commence from Royal Assent to this Bill but some apply prospectively or retrospectively.
Proposal announced : These amendments have not previously been announced.
Financial impact : The revenue impact of extending capital allowance roll-over relief for depreciating assets to the case where a fixed trust is converted to a company, is unquantifiable, but is expected to involve a minimal to small cost to revenue. Each of the other amendments will have a nil to minimal revenue impact.
Compliance cost impact : Nil to low.