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A Part IVA that goes the other way? The rule against double taxation


“Loopholes” for avoiding tax have traditionally been recognised as flaws in our income tax legislation. Less recognised is the fact that the ever-increasing complexity of Australia’s tax legislation also creates “reverse loopholes”, that is, unintended instances of double taxation. The existence of Part IVA greatly discourages taxpayers from exploiting loopholes, but there is no comprehensive rule stopping the revenue from benefiting from double taxation. This also contrasts with the international tax system, which has as a key principle the reduction of double taxation.

This paper describes the existing, piecemeal approaches to domestic double taxation taken by the legislation and the Courts, and advocates for a more comprehensive and simple legislative rule preventing double taxation.

Author profile:

Chloe Burnett ATI
Chloe is a Barrister at the New South Wales Bar. She practises mainly in tax but also in commercial and administrative law, and has appeared in a number of high-profile tax matters. Before joining the New South Wales Bar, Chloe practised as a solicitor at Allens and was the Associate to Hon. Justice Edmonds of the Federal Court. She has also worked for Macquarie Bank and for Slaughter & May in London. Chloe has been an Adjunct Lecturer at the University of Sydney Law School since 2006. Current at 01 June 2015 Click here to expand/collapse more articles by Chloe BURNETT.
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