INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)

PART III - LIABILITY TO TAXATION  

Division 11A - Dividends, interest and royalties paid to non-residents and to certain other persons  

Subdivision A - General  

SECTION 128GA   DIVISION NOT TO APPLY TO INTEREST ON CERTAIN GOVERNMENT LOANS AND GOVERNMENT AUTHORITY LOANS  

128GA(1)   [Application of section]  

This section applies to interest in respect of a loan where:

(a) the loan was raised by an authority of the Commonwealth, by a State or by an authority of a State, in pursuance of a contractual obligation entered into on or after 20 May 1983;

(b) the Treasurer has issued a certificate under subsection (3) in respect of the loan; and

(c) the loan was raised outside Australia.

128GA(2)   [Application for loan certificate]  

An entity that has raised a loan the interest on which would, subject to the issue of a certificate under subsection (3) in respect of the loan, be interest referred to in subsection (1) may apply to the Treasurer in writing for the issue of such a certificate.

128GA(3)   [Issue of certificate]  

Subject to subsection (4), where an application is made in accordance with subsection (2) in respect of a loan, the Treasurer may issue to the applicant a certificate under this subsection containing particulars of the loan.

128GA(4)   [Loan moneys used to compete with non-government enterprise]  

The Treasurer shall not issue a certificate under subsection (3) in respect of a loan if he is satisfied that the loan moneys will be used by an authority of the Commonwealth or of a State in competing directly with a non-government enterprise.

128GA(5)   [No tax payable]  

Tax is not payable, and shall be deemed not to have been payable, in accordance with this Division, in respect of interest to which this section applies.

128GA(5A)   [Interest to which section not applicable]  

This section does not apply to:

(a) interest paid after the date of commencement of this subsection in respect of a loan raised pursuant to a contractual obligation entered into after 1 July 1986; or

(b) interest paid after the date of commencement of this subsection in respect of a loan raised pursuant to a contractual obligation entered into before 2 July 1986 to the extent to which:

(i) the interest is paid in respect of loan money that:

(A) was borrowed by the borrower after 1 July 1986; and

(B) before 2 July 1986, the borrower was not under a contractual obligation to borrow;

(ii) the interest is paid in respect of a loan resulting from a roll-over , after 1 July 1986, of the whole or a part of a previous loan; or

(iii) the interest is paid in respect of a period of extension of the period for which loan money was lent, being an extension occurring after 1 July 1986.

128GA(6)   [``non-government enterprise'']  

In this section, non-government enterprise means an enterprise carried on by an entity other than the Commonwealth, a State or an authority of the Commonwealth or of a State.