Supplementary Explanatory Memorandum
(Circulated by authority of the Treasurer, the Hon Peter Costello, MP)General outline and financial impact
Amendments to Schedule 10 - endorsement of charities
These amendments change the start date of the measure to require charities, public benevolent institutions and health promotion charities to be endorsed to access relevant tax concessions from 1 July 2004 to 1 July 2005.
Date of effect: 1 July 2005.
Proposal announced: 2004-2005 Budget and in the Treasurer's Press Release No. 31 of 11 May 2004.
Financial impact: The measure implementing the Government's response to the Report of the Inquiry into the Definition of Charities and Related Organisations involves a revenue cost of $3 million in 2004-2005.
Compliance cost impact: The change in the date of effect will ensure that charities have more time to comply with the proposed endorsement arrangements.
Chapter 1 Amendments to Schedule 10 - endorsement of charities
Explanation of amendments
1. 1.1 These amendments change the start date of the measure in Schedule 10 of the Tax Laws Amendment (2004 Measures No. 1) Bill 2004 to 1 July 2005. Schedule 10 introduces changes to require charities, public benevolent institutions and health promotion charities to be endorsed by the Commissioner of Taxation in order to access relevant taxation concessions.
2. 1.2 It was initially proposed that this measure would take effect on 1 July 2004. These amendments will provide affected organisations with more time to comply with the new arrangements.
3. 1.3 In the interim, charities, public benevolent institutions and health promotion charities may continue to self-assess their eligibility for fringe benefits tax and goods and services tax concessions. Charities will continue to require endorsement under the provisions set out in the Income Tax Assessment Act 1997 in order to access the income tax exemption for charities and deductible gift recipient status.