Australian Tax Forum

Australian Tax Forum - Volume 24

Australian Tax Forum is a prestigious quarterly journal with the objective of providing discussion on issues in tax policy, law and reform amongst tax professionals. It is an essential reference source for understanding and contributing to the development of taxation systems worldwide. Australian Tax Forum is aimed at those who want to influence the future development of tax policy. It is an important journal for tax policy makers, academics and libraries.

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Articles from the current issue:

  • Informal entities and the tax unit: The impact of social institutions on tax designAdd to cart

    Douglass C. North presented the seminal work on institutions and their relationship to economic performance. Essentially, institutions are “humanly devised constraints that shape human interaction”. An institution may be created by the state on the one hand (for example, statute law) or on the other hand by norms of social interaction, custom, traditions and codes of conduct. The former are formal institutions while the latter are informal or social institutions. To elucidate a social institution can be defined as “a complex of positions, roles, norms and values lodged in particular types of social structures and organising relatively stable patterns of human activity with respect to fundamental problems in producing life-sustaining resources, in reproducing individuals, and in sustaining viable societal structures within a given environment.”.

  • Informal assets and liabilities and the definition of taxable income: The impact of social institutions on tax designAdd to cart

    This paper follows the previously published paper “Informal Entities and the Tax Unit: The Impact of Social Institutions on Tax Design:” by continuing to look at the impact of social institutions on tax efficacy through exploring their impact on the concept of taxable income. To recap, Douglass C. North presented the seminal work on institutions and their relationship to economic performance. Essentially, institutions are “humanly devised constraints that shape human interaction”. An institution may be created by the state on the one hand (for example, statute law) or on the other hand by norms of social interaction, custom, traditions and codes of conduct.

  • The compliance costs of Australia’s emissions trading scheme: An exploratory analysisAdd to cart

    The Australian Government intends to introduce a carbon emissions permit trading scheme from 1 July 2011 (subject to Parliamentary approval), postponed one year from its originally proposed starting date, and to be phased in over probably a decade or so. The revenue effect of this scheme is estimated to be A$4.5 billion in 2011-12 and A$13 billion in 2012-13, its first year of (‘real’) operation with auctioned permits. The scheme will initially comprise around 1,000 large emitters, namely those with emissions over 25,000 tonnes of carbon dioxide equivalent per annum. The Government will allocate some free permits in the early years of its Emissions Trading Scheme (ETS) as a form of compensation to certain industries. There will be compensation for households, businesses and affected industries under a roughly ‘revenue-neutral’ system. To date the Government has recognized specific compliance costs issues, such as the application of Goods and Services Tax to trading, but has not made any analysis of possible overall compliance costs of the ETS.

  • Tax administration: Safe harbours and new horizonsAdd to cart

    Michael Walpole and Chris Evans have drawn together selected and refereed papers from the 8th Atax International Tax Administration Conference, held in Sydney, Australia in 2008, in Tax Administration: Safe Harbours and New Horizons (Fiscal Publications). This is the third volume in the series of collected papers from these conferences. The cast of authors includes several eminent names in tax. The substance of the chapters provides a range of perspectives, analysis and topics within tax administration. This book is well worth reading. Some of the chapters are exceptionally useful. Others add less to the sum of knowledge. Much more important is the hidden tension in the formulation, implementation and ongoing administration of tax policy and regulation that keeps rising irresistibly to the surface. Why should it demand attention? It goes to the heart of efficient and effective government in a constitutional democracy. The plot of this book is perhaps how governments can best raise the revenue they need to run the country. The sub-plots then encompass the relationship of governments with their citizens; how government needs to work ever more efficiently and effectively; the relationship between the different arms of government; and the pressure on individual governments operating in a global context.

  • "The science of tax design?”: Tax policy within the Australian Government’s White Paper on the Carbon Pollution Reduction Scheme (CPRS)Add to cart

    The legislation to give effect to Australia’s Carbon Pollution Reduction Scheme (CPRS) from the year beginning 1 July 2011 was introduced into the House of Representatives on 14 May 2009 and was defeated in the Senate on 13 August 2009. The CPRS was based upon a White Paper: Carbon Pollution Reduction Scheme: Australia’s Low Pollution Future on 15 December 2008. The paper, which followed on the Green Paper released on 16 July 2008, outlines the final design of the CPRS and the medium-term target range for reducing carbon pollution. In the tax context very little has changed from scheme outlined in the July Green Paper, despite extensive consultation with the tax profession.

  • Fringe Benefits Tax for cars: Some further considerations for policy change and reformAdd to cart

    In July 2008 the Australian Tax Forum journal published an article about research outcomes based on the contention that the Fringe Benefits Tax ‘statutory formula method’ for cars promotes the usage of cars, the effects of which are higher usage of petrol and increased emissions of greenhouse gases; both these negative aspects are unintended consequences of the 20 year old FBT legislation. Our central question and post research results were presented to a variety of tax forums over three years. This article presents some additional issues raised by various delegates at three of those forums as part of the next step in addressing the shortfalls of Fringe Benefits Tax in relation to cars, the necessary recasting of policy and reform to the legislation.

  • Reducing withholding tax rates in double tax treaties: Trends and implicationsAdd to cart

    In the last decade, several countries have reduced their withholding tax rates seemingly in order to attract foreign investment. This article examines the downward trends in the withholding tax rates in double tax treaties entered into by the United States, the United Kingdom, Canada, Australia and New Zealand and the implications of these reductions. A case study is conducted of the protocol entered into between the United States and New Zealand.

  • Public private partnerships: Capital allowance deductions for infrastructure projectsAdd to cart

    Capital allowance deductions for the assets used in PPP infrastructure projects can be denied to the private sector participant in the project where government retains the economic ownership of the asset. Two sets of rules that attempted to characterise PPP arrangements where government retained economic ownership had led to taxpayer uncertainty and delays in projects. The Ralph Review of Business taxation recommended that these rules be replaced with ones that would create more certainty for private sector participants in PPP projects. The rules that have now been inserted, after an aborted attempt at using banking type concepts of risk allocation as a measure of economic ownership, use concepts of control of use and predominant economic ownership to identify transactions where capital allowance deductions are denied. That, together with more generous safe harbours, specific exclusions and better clarification of control, seems to have achieved the desirable outcome of private sector participants being able to consider the application of these rules to a project with reasonable certainty.