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House of Representatives

Taxation Laws Amendment Bill (No. 3) 1990

Taxation Laws Amendment Act (No. 3) 1990

Explanatory Memorandum

(Circulated by authority of the Treasurer, the Hon. P.J. Keating, M.P.)

GENERAL OUTLINE

This Bill will amend:

The Income Tax Assessment Act 1936

·
the Income Tax Assessment Act 1936 -

· .
to provide for the tax consequences for both companies that repurchase their shares and for vendor shareholders that sell their shares back to a company in a share buy-back transaction (proposal announced on 31 October 1989);
· .
to remove the exemption from the thin capitalisation rules for Australian-owned non-resident companies (1989-90 Budget announcement);
· .
to extend, from 30 June 1992 to 30 June 1997, the effective termination date of the special accelerated depreciation concession for Australian trading ships (proposal announced by the Minister for Transport and Communications in a Ministerial Statement on reform of the shipping and waterfront industries on 1 June 1989);
· .
to remove or modify the operation of certain provisions that require an actuary to certify deductions or exemptions from tax claimed by a superannuation fund (proposal announced on 14 February 1990).
· .
to widen the manner in which pensioners, and entities not required to lodge income tax returns, may provide the necessary information to an investment body to claim an exemption from quoting a tax file number in relation to certain investments;
· .
to raise, from $5,000 to $8,000, for the 1989-90 and subsequent years of income, the threshold for general exemption from the quarterly instalment system of paying provisional tax (1989-90 Budget announcement);
· .
to ensure that excess provisional tax credits are not offset against quarterly instalments of provisional tax not yet due for payment (1989-90 Budget announcement);
· .
to allow income tax deductions for gifts to -

-
the National Foundation for Australian Women Limited (proposal announced 15 December 1989);
-
Landcare Australia Limited (proposal announced 19 March 1990); and
-
The Foundation for Development Cooperation Ltd (proposal announced 11 April 1990).

The Fringe Benefits Tax Assessment Act 1986

·
the Fringe Benefits Tax Assessment Act 1986 -

· .
to allow certain employers to amortise the taxable value of housing assistance provided to employees under a remote area home ownership scheme over a period of fifteen years, rather than the existing maximum of seven years.

The Sales Tax (Exemptions and Classifications) Act 1935

·
the Sales Tax (Exemptions and Classifications) Act 1935 -

· .
to confirm the interim exemption from sales tax given by ACT regulations for goods for official use by ACT government departments and certain ACT authorities.

The Bill will also establish the basis of calculating instalments of provisional tax for the 1990-91 year. The basis will correspond with the base that would have applied had the Income Tax Assessment Amendment Bill 1989 not lapsed when the Parliament was dissolved prior to the recent elections.


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