Miscellaneous 2012

On regulatory change and retrospectivity: Insights from the CPRS and the RSPT

Source: Australian Tax Forum Journal Article

Published Date: 1 Dec 2012


This paper examines the appropriateness and consequences of compensation and transitional arrangements such as “grandfathering” in regulatory design, with particular reference to two public policy initiatives championed by the Rudd Labor Government in Australia between 2007 and 2010 – the Carbon Pollution Reduction Scheme (CPRS) and the Resources Super Profits Tax (RSPT). In particular, this paper explores the efficacy of alternative approaches to compensation and transitional relief where regulatory change has a retrospective impact. In doing so it considers factors that may be relevant to the choice of whether or not to provide any compensatory or transitional relief.

This paper also highlights the risks associated with governments taking inconsistent approaches to compensation and transitional relief on policy reform, and argues that the different approaches taken to compensation with respect to the CPRS and the RSPT was a factor that contributed to the uncertainty and opposition that enveloped both policy proposals.

Author Profile
Bruce Cohen
Author Profile
Malcom Abbott

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Miscellaneous 2012

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