The measures in the draft legislation form part of a package of reforms that were originally announced in the 2009-10 Budget and include:
- allowing entities to self-assess their eligibility to form, alter or revoke a GST group or joint venture and to do so at any time during a tax period;
- introducing clear exit rules for entities leaving GST groups or joint ventures;
- expanding the income tax rulings system to include indirect taxes; and
- reforming the tax invoice rules.
Some of the changes made to the measures as a result of stakeholder feedback include:
- expanding the proposed clear exit rules to allow entities to enter into indirect tax sharing agreements similar to the tax sharing agreements for income tax consolidated groups and to apply these rules to all liabilities arising under the indirect tax law;
- including indirect tax rulings and also excise advice in the income tax rulings system. Given the unique nature of indirect taxes, some special rules will be retained including ensuring revenue neutrality in the GST system;
- revising the rulings measure so that suppliers and recipients will not be entitled to rely on a GST private ruling issued to the other party (unless they jointly apply for a ruling). The practical difficulties of implementing this change were identified during consultation; and
- replacing the existing tax invoice rules with new more principled rules that allow one or more documents to satisfy the tax invoice requirements, thus removing the need for taxpayers to treat another suitable document as a tax invoice by notifying the Commissioner of Taxation.
Consultation closes on Monday 22 February 2010.
The Minister said that further exposure drafts will be released for consultation in coming months.