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24 Aug 09 Removal of interest withholding tax on Commonwealth Government securities

In a joint media release issued on 21 August 2009, the Treasurer, Wayne Swan, and the Assistant Treasurer, Senator Nick Sherry, announced that the Government will remove interest withholding tax (IWT) on Commonwealth Government securities. This will address the anomaly that has existed since IWT was removed from publicly issued corporate bonds in 1999 and state government securities in 2008. It will also bring Australia's tax treatment of Commonwealth Government securities into line with most other countries, including the United States and the United Kingdom.

These changes will make Commonwealth Government Securities eligible for exemption from IWT under section 128F of ITAA 1936, and will apply to interest paid after the day the bill receives Royal Assent.

On the same day, Treasury released an Exposure Draft Bill and draft Explanatory Memorandum. Consultation will close on Friday, 28 August 2009.

For a copy of the joint media release, No 2009/035, 21 August 2009, go here

For a copy of the Exposure Draft Bill and draft Explanatory Memorandum, go here

 


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