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ATO stifling opportunities for Australia

Publication date: 01 Dec 97 | Source: THE TAX INSTITUTE

ATO stifling opportunities for Australia

Recent behaviour of the Australian Taxation Office carries with it the risk of making Australia an investment backwater in the eyes of foreign investors, according to the Taxation Institute of Australia President, Mr Richard Gelski.

"A recent refusal to apply well established rules enshrined in Tax Office public rulings is an example of behaviour which has foreign investors scratching their heads and causes significant embarrassment to Australia," Mr Gelski said.

As a result, in assessing proposed investments in Australia foreigners are beginning to apply a discount for "country risk", a phenomenon well known when dealing with developing or politically unpredictable countries but which should have no place in relation to Australia today. This is particularly important at a time when Australia is trying to distance itself from the ongoing financial crisis in Asia.

"It is outrageous that the Tax Office can bring such discredit to our otherwise attractive shores," Mr Gelski said.

"This government has committed itself to creating a tax system which satisfies the criteria for a top class tax system."

"Perhaps someone should remind the Tax Office that consistency is one of the criteria at the top of the list. Its lack of consistency is undermining our capacity to compete for foreign investment when we should be a foreign investor's first port of call," he said.