The Tax Institute welcomes the opportunity to contribute to the Inspector-General of Taxation and Taxation Ombudsman's (IGTO) investigation into The Exercise of the Commissioner's Remedial Power and related terms of reference (Investigation).
Broadly, the Commissioner's Remedial Power (CRP) gives the Commissioner of Taxation (Commissioner) the power to modify the operation of the tax legislation in instances where the legislation is not operating as intended by Parliament. Such modification must be for the benefit of the taxpayer or to ensure impacted taxpayers are at least no worse off. The CRP was intended to play an important role in resolving technical and administrative deficiencies in the legislation that may not otherwise be resolved through processes such as law change and has indeed done so, albeit in very limited circumstances. The Tax Institute considers that there is the potential for the CRP to be used far more effectively through broader interpretation and greater transparency.
We have had the benefit of reviewing the submission prepared by the Corporate Tax Association (CTA) on the CRP for the purposes of the Investigation (CTA submission). The Tax Institute endorses and supports the CTA submission. Please consider the CTA submission to be a reflection of our views regarding the CRP and the matters raised in the terms of reference for the
Investigation. In addition, we have set out below comments which build on key points outlined in the CTA submission and also reflect feedback from The Tax Institute's members.