05 Mar 12 Government announces amendments to Part IVA
In media release No 2012/010, issued 1 March 2012, the outgoing Assistant Treasurer, Minister for Small Business and Minister for Sport, Senator Mark Arbib, announced that the Government would introduce amendments to Part IVA of ITAA 1936.
Senator Arbib said the amendments would ensure that the general anti-avoidance rule, known as Part IVA, continued to be effective in countering tax avoidance schemes that are carried out as part of broader commercial transactions.
"In recent cases, some taxpayers have argued successfully that they did not get a 'tax benefit' because, without the scheme, they would not have entered into an arrangement that attracted tax...For example, they could have entered into another scheme that also avoided tax, deferred their arrangements indefinitely or done nothing at all. Such an outcome can potentially undermine the overall effectiveness of Part IVA and so the Government will act to ensure such arguments will no longer be successful," Senator Arbib said.
Senator Arbib said that the Government was mindful that any amendments should not interfere with genuine commercial transactions and activities of taxpayers. To ensure that this is the case, the Government will consult extensively.
The consultation process will involve public consultation on the draft amendments. Treasury will also conduct roundtable discussions at key stages in the development of these amendments.
To minimise any potential for taxpayers to obtain unintended tax advantages in the interim, the amendments will apply to schemes entered into or carried out after 1 March 2012.
The Government intends to introduce the necessary amendments into Parliament in the Spring 2012 sittings.