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A Bill for an Act to amend the law relating to taxation and competition, and for related purposes
Administered by: Treasury
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Registered 20 Sep 2018
Introduced HR 20 Sep 2018
Table of contents.

2016‑2017‑2018

 

The Parliament of the

Commonwealth of Australia

 

HOUSE OF REPRESENTATIVES

 

 

 

 

Presented and read a first time

 

 

 

 

Treasury Laws Amendment (2018 Measures No. 5) Bill 2018

 

No.      , 2018

 

(Treasury)

 

 

 

A Bill for an Act to amend the law relating to taxation and competition, and for related purposes

  

  


Contents

1............ Short title............................................................................................. 1

2............ Commencement................................................................................... 1

3............ Schedules............................................................................................ 2

Schedule 1—AMIT technical amendments                                                            3

Income Tax Assessment Act 1936                                                                              3

Income Tax Assessment Act 1997                                                                              3

Income Tax (Transitional Provisions) Act 1997                                                    6

Taxation Administration Act 1953                                                                           6

Tax Laws Amendment (New Tax System for Managed Investment Trusts) Act 2016           10

Schedule 2—Deductible gift recipients                                                                    13

Income Tax Assessment Act 1997                                                                            13

Schedule 3—Extending DGR status to entities promoting Indigenous languages             15

Income Tax Assessment Act 1997                                                                            15

Schedule 4—Repeal of subsection 51(3) of the Competition and Consumer Act 2010   16

Competition and Consumer Act 2010                                                                   16

 

 


A Bill for an Act to amend the law relating to taxation and competition, and for related purposes

The Parliament of Australia enacts:

1  Short title

                   This Act is the Treasury Laws Amendment (2018 Measures No. 5) Act 2018.

2  Commencement

             (1)  Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.

 

Commencement information

Column 1

Column 2

Column 3

Provisions

Commencement

Date/Details

1.  Sections 1 to 3 and anything in this Act not elsewhere covered by this table

The day this Act receives the Royal Assent.

 

2.  Schedule 1

The first 1 January, 1 April, 1 July or 1 October to occur after the day this Act receives the Royal Assent.

 

3.  Schedule 2

The first 1 January, 1 April, 1 July or 1 October to occur after the day this Act receives the Royal Assent.

 

4.  Schedule 3

1 July 2019.

1 July 2019

5.  Schedule 4

The day after the end of the period of 6 months beginning on the day this Act receives the Royal Assent.

 

Note:          This table relates only to the provisions of this Act as originally enacted. It will not be amended to deal with any later amendments of this Act.

             (2)  Any information in column 3 of the table is not part of this Act. Information may be inserted in this column, or information in it may be edited, in any published version of this Act.

3  Schedules

                   Legislation that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms.

Schedule 1AMIT technical amendments

  

Income Tax Assessment Act 1936

1  At the end of subsection 128B(1A)

Add:

Note:          References in this section to amounts paid to a person may include amounts from an AMIT that, under section 12A‑205 in Schedule 1 to the Taxation Administration Act 1953, are treated as payments to the person (from the trustee of the AMIT or a custodian).

Income Tax Assessment Act 1997

2  At the end of section 104‑71

Add:

             (6)  Item 7 of the table in subsection (4) does not apply if the entity making the payment is a *managed investment trust.

3  Paragraphs 104‑107A(1)(b) and (c)

Repeal the paragraphs, substitute:

                     (b)  either:

                              (i)  the *cost base of that asset is reduced under subsection 104‑107B(2) during the income year; or

                             (ii)  the cost base of that asset is nil at the start of the income year; and

                     (c)  the asset’s *AMIT cost base net amount for the income year is the excess mentioned in paragraph 104‑107C(a); and

                     (d)  the asset’s AMIT cost base net amount for the income year exceeds the cost base of the asset.

4  Subsection 104‑107A(2)

Repeal the subsection, substitute:

             (2)  The time of the event is:

                     (a)  if subparagraph (1)(b)(i) applies—the time at which the reduction occurs under section 104‑107B; or

                     (b)  if subparagraph (1)(b)(ii) applies—the time at which the *cost base would have been reduced under subsection 104‑107B(2) during the income year if the cost base had been greater than nil at the start of the income year.

5  Subsection 104‑107A(3)

Repeal the subsection, substitute:

             (3)  You make a capital gain equal to:

                     (a)  if the *cost base of the asset is nil—the excess mentioned in paragraph 104‑107C(a); or

                     (b)  if the cost base of the asset is not nil—the excess mentioned in paragraph (1)(d) of this section.

Note 1:       If you make a capital gain, the cost base and reduced cost base of the CGT asset are reduced to nil (see paragraph 104‑107B(2)(a)).

Note 2:       You cannot make a capital loss.

6  Paragraph 104‑107F(1)(f)

Omit “section 104‑107E”, substitute “section 104‑107D”.

7  After paragraph 275‑20(4)(i)

Insert:

                    (ia)  the *Future Fund Board;

8  After subsection 275‑20(4)

Insert:

          (4A)  Any financial assets (within the meaning of the Future Fund Act 2006) held by the *Future Fund Board are taken, for the purposes of subparagraph (4)(k)(ii), to be held by the Future Fund Board in its own right.

9  Paragraph 276‑10(1)(c)

Repeal the paragraph.

10  Subsections 276‑315(4) and (5)

Repeal the subsections.

11  Subsection 276‑415(4)

Repeal the subsection, substitute:

             (4)  For the purposes of subsection (2), treat the amount of the shortfall under subsection (1) relating to the component as being double what it would be apart from this subsection.

12  Paragraph 840‑805(2)(b)

Omit “a payment that is”.

13  At the end of subsection 840‑805(2)

Add:

Note 1:       Because a fund payment can be adjusted to account for earlier fund payments and the expected amounts of later fund payments (see subsection 12A‑110(5) in Schedule 1 to the Taxation Administration Act 1953), the amount of a particular fund payment may not reflect the actual amount you are paid for the purposes of this subsection.

Note 2:       If the withholding MIT is an AMIT, under subsection 12A‑205(2) in Schedule 1 to the Taxation Administration Act 1953, amounts may be treated, for the purposes of this Subdivision, as having been paid to you from the trustee of the AMIT.

14  Paragraph 840‑805(3)(b)

Omit “a payment that is”.

15  At the end of subsection 840‑805(3)

Add:

Note:          If the withholding MIT is an AMIT, under subsection 12A‑205(5) in Schedule 1 to the Taxation Administration Act 1953, amounts may be treated, for the purposes of this Subdivision, as having been paid to you from the custodian.

16  Paragraph 842‑230(1)(a)

Omit “or (i)”, substitute “, (i) or (ia)”.

17  Subsection 995‑1(1)

Insert:

Future Fund Board means the Future Fund Board of Guardians established by section 34 of the Future Fund Act 2006.

Income Tax (Transitional Provisions) Act 1997

18  Section 276‑25 (definition of starting income year)

Repeal the definition, substitute:

starting income year means:

                     (a)  unless paragraph (b) or (c) applies—the 2017‑18 income year; or

                     (b)  if the trustee of the trust has made a choice for the purposes of paragraph 1(1)(b) of Schedule 8 to the Tax Laws Amendment (New Tax System for Managed Investment Trusts) Act 2016—the first income year starting on or after 1 July 2015; or

                     (c)  if the trustee of the trust has made a choice for the purposes of subparagraph 276‑10(1)(e)(i) of the Income Tax Assessment Act 1997 in respect of the 2016‑17 income year—that income year.

Taxation Administration Act 1953

19  At the end of subsection 12‑140(1) in Schedule 1

Add:

Note:          If the investment body is an AMIT, under subsection 12A‑205(2) amounts may be treated, for the purposes of this Part, as having been paid to the other entity by the investment body.

20  At the end of section 12‑140 in Schedule 1

Add:

             (3)  If:

                     (a)  because of subsection 12A‑205(2), an entity is treated as having made a payment to another entity; and

                     (b)  under subsection (2) of this section, the entity has withheld an amount from that payment, and paid the amount to the Commissioner;

the entity may recover from the other entity, as a debt, the amount withheld.

             (4)  The entity is entitled to set off an amount that the entity can recover from the other entity under subsection (3) against debts due by the entity to the other entity.

21  After section 12‑150 in Schedule 1

Insert:

12‑152  Limited application of section 12‑140 to payment covered by section 12A‑205

             (1)  If a payment is treated under section 12A‑205 as having been made, section 12‑140 does not apply to the payment to the extent that it covers a *pre‑AMMA actual payment from which section 12‑140 has required an amount to be withheld.

             (2)  If a payment is a *post‑AMMA actual payment, section 12‑140 does not apply to the payment to the extent that it covers either or both of the following:

                     (a)  a *pre‑AMMA actual payment from which section 12‑140 has required an amount to be withheld;

                     (b)  a payment that is treated under section 12A‑205 as having been made from which section 12‑140 has required an amount to be withheld.

22  Section 12‑383 in Schedule 1

Before “A trust”, insert “(1)”.

23  Paragraph 12‑383(a) in Schedule 1

Omit “(2)(b)”, substitute “subsection 275‑10(2)”.

24  At the end of section 12‑383 in Schedule 1

Add:

             (2)  For the purposes of ascertaining whether a trust is a *managed investment trust in relation to that income year for the purposes of paragraph (1)(a), treat as a *fund payment by the trustee of the trust any amount that, under subsection 12A‑205(2), would be treated as a payment by the trustee if the trust were an *AMIT.

Note:          The making of a fund payment is a requirement for the trust to be a managed investment trust under paragraph 275‑10(1)(a) and subsection 275‑10(3) of the Income Tax Assessment Act 1997.

25  Subsection 12‑405(2) in Schedule 1 (method statement, at the end of step 1)

Add “, and increase it by any amounts to which subsection (2A) or (2B) applies for the income year (except to the extent that capital gains against which those amounts are applied are included in the actual payment made in relation to the income year)”.

26  Subsection 12‑405(2) in Schedule 1 (method statement, step 2, before paragraph (a))

Insert:

             (aa)     increasing the net income by any amounts to which subsection (2A) or (2B) applies for the income year; and

27  Subsection 12‑405(2) in Schedule 1 (method statement, step 2, paragraph (a))

After “disregarding”, insert “(except to the extent that they are amounts to which subsection (2A) or (2B) applies for the income year)”.

28  After subsection 12‑405(2) in Schedule 1

Insert:

          (2A)  If:

                     (a)  during an income year, a *capital loss from a *CGT event happens in relation to a *CGT asset that is not *taxable Australian property; and

                     (b)  in relation to that income year, some or all of the capital loss is applied against a *capital gain from a CGT event that happens in relation to a CGT asset that is taxable Australian property;

this subsection applies, for that income year, to the amount that is so applied.

          (2B)  If:

                     (a)  the trust has a *net capital loss for an income year; and

                     (b)  one or more of the *capital losses the trust made during that income year were from *CGT events that happened in relation to *CGT assets that were not *taxable Australian property; and

                     (c)  in relation to a later income year, some or all of the net capital loss is applied against a *capital gain from a CGT event that happens in relation to a CGT asset that is taxable Australian property;

this subsection applies, for the later income year, to an amount equal to so much of the net capital loss that is so applied as related to capital losses mentioned in paragraph (b).

29  Paragraph 12A‑110(3)(b) in Schedule 1

Repeal the paragraph, substitute:

                     (b)  the total of each *capital loss of the AMIT from a *CGT event that:

                              (i)  happened in the income year to a CGT asset that is not taxable Australian property; and

                             (ii)  has been applied against a capital gain from a CGT event that happened in relation to a CGT asset that is taxable Australian property;

                            but only to the extent that each such capital loss has been so applied in the income year;

                     (c)  the total of each amount to which subsection (3A) applies in relation to the income year.

30  After subsection 12A‑110(3) in Schedule 1

Insert:

          (3A)  If:

                     (a)  the AMIT has a *net capital loss for an earlier income year; and

                     (b)  one or more of the *capital losses the trust made during that earlier income year were from *CGT events that happened in relation to *CGT assets that were not *taxable Australian property; and

                     (c)  in relation to the income year mentioned in paragraph (3)(c), some or all of the net capital loss is applied against a *capital gain from a CGT event that happens in relation to a CGT asset that is taxable Australian property;

this subsection applies, for the income year mentioned in paragraph (3)(c), to an amount equal to so much of the net capital loss that is so applied as related to capital losses mentioned in paragraph (b) of this subsection.

31  Paragraph 12A‑215(1)(a) in Schedule 1

Repeal the paragraph.

32  Subparagraph 12A‑215(1)(c)(i) in Schedule 1

Repeal the subparagraph, substitute:

                              (i)  if the payment is a *fund payment and the trust is a *withholding MIT in relation to the income year—an entity covered by section 12‑410; or

33  Subparagraph 12A‑215(1)(c)(ii) in Schedule 1

After “*AMIT DIR payment”, insert “made in relation to the income year”.

Tax Laws Amendment (New Tax System for Managed Investment Trusts) Act 2016

34  Subitem 75(2) of Schedule 5

Omit “Subitem (3) applies”, substitute “Subitems (3) and (3A) apply”.

35  Paragraph 75(2)(b) of Schedule 5

Omit “1 July 2018”, substitute “1 July 2019”.

36  At the end of paragraph 75(2)(c) of Schedule 5

Add:

                      ; or (v)  the trust ceasing to be a franking entity.

37  After subitem 75(2) of Schedule 5

Insert:

(2A)     However, subparagraph (2)(c)(v) does not apply unless the trust’s franking account is in surplus immediately before the trust ceases to be a franking entity.

38  After subitem 75(3) of Schedule 5

Insert:

(3A)     If the event is an event described in item 4 of the table in subsection 205‑30(1) of the Income Tax Assessment Act 1997, treat the event as happening on 1 July 2019.

39  Subitem 75(4) of Schedule 5

Omit “Subitem (5) applies”, substitute “Subitems (5) and (6) apply”.

40  Paragraph 75(4)(a) of Schedule 5

Omit “1 July 2018”, substitute “1 July 2019”.

41  At the end of subitem 75(4) of Schedule 5

Add:

             ; and (c)  the distribution is not made out of income derived in relation to the 2016‑17 income year or a later income year.

42  After subitem 75(5) of Schedule 5 (before the note)

Insert:

(6)       Treat a beneficiary of the trust who receives the distribution as receiving, for the purposes of the income tax law, a dividend from a corporate tax entity.

43  Subitem 1(1) of Schedule 8

Omit “income years starting on or after”.

44  Paragraph 1(1)(a) of Schedule 8

Omit “1 July 2016”, substitute “the 2016‑17 income year and later income years”.

45  Paragraph 1(1)(b) of Schedule 8

Before “1 July 2015”, insert “income years starting on or after”.

46  Application of amendments

(1)       The amendment made by item 2 of this Schedule applies in relation to distributions made in relation to the 2017‑18 income year and later income years.

(2)       The amendment made by item 9 of this Schedule applies in relation to the 2017‑18 income year and later income years.

(3)       The amendments made by item 18 and items 43 to 45 of this Schedule apply in relation to the 2016‑17 income year and later income years.

(4)       The amendments made by any other items of this Schedule apply in relation to the 2018‑19 income year and later income years.

Schedule 2Deductible gift recipients

  

Income Tax Assessment Act 1997

1  Subsection 30‑25(2) (at the end of the table)

Add:

 

2.2.45

Smile Like Drake Foundation Limited

the gift must be made after 8 March 2018 and before 9 March 2023

2.2.46

The Q Foundation Trust

the gift must be made after 31 December 2017 and before 1 January 2023

2  Subsection 30‑45(2) (at the end of the table)

Add:

 

4.2.44

Victorian Pride Centre Ltd

the gift must be made after 8 March 2018 and before 9 March 2023

3  Section 30‑90 (at the end of the table)

Add:

 

10.2.9

Australian Sports Foundation Charitable Fund

the gift must be made after 30 June 2018 and before 1 July 2023

4  Section 30‑95 (at the end of the table)

Add:

 

11.2.11

Australian Women Donors Network

the gift must be made after 8 March 2018 and before 9 March 2023

5  Section 30‑105 (at the end of the table)

Add:

 

13.2.24

Paul Ramsay Foundation Limited

the gift must be made after 30 June 2018 and before 1 July 2020

6  Section 30‑315 (after table item 27)

Insert:

 

27AAAA

Australian Sports Foundation Charitable Fund

item 10.2.9

27AAAB

Australian Women Donors Network

item 11.2.11

7  Section 30‑315 (after table item 82A)

Insert:

 

83

Paul Ramsay Foundation Limited

item 13.2.24

8  Section 30‑315 (after table item 94)

Insert:

 

94AA

Q Foundation Trust

item 2.2.46

9  Section 30‑315 (table items 111A, 111AAA and 111AA)

Repeal the items, substitute:

 

111AA

Sir William Tyree Foundation

item 2.2.18

111AB

Smile Like Drake Foundation Limited

item 2.2.45

111AC

Social Traders Ltd

item 13.2.5

111A

Social Ventures Australia Limited

item 13.2.16

10  Section 30‑315 (after table item 121A)

Insert:

 

121B

Victorian Pride Centre Ltd

item 4.2.44

Schedule 3Extending DGR status to entities promoting Indigenous languages

  

Income Tax Assessment Act 1997

1  Subsection 30‑300(2)

Omit “arts of”, substitute “arts or languages of”.

Schedule 4Repeal of subsection 51(3) of the Competition and Consumer Act 2010

  

Competition and Consumer Act 2010

1  Subsection 51(3)

Repeal the subsection.

2  In the appropriate position in Part XIII

Insert:

Division 4Application of amendment made by the Treasury Laws Amendment (2018 Measures No. 5) Act 2018

186  Application of repeal of subsection 51(3)

             (1)  The amendment made by item 1 of Schedule 4 to the Treasury Laws Amendment (2018 Measures No. 5) Act 2018 applies in relation to a licence granted, an assignment made, or a contract, arrangement or understanding entered into, on or after the commencement of that Schedule.

             (2)  The amendment also applies to a licence granted, an assignment made, or a contract, arrangement or understanding entered into, before the commencement of that Schedule in relation to:

                     (a)  conditions imposed, or provisions included, on or after that commencement; and

                     (b)  conditions imposed, or provisions included, before that commencement.

             (3)  Despite subsections (1) and (2), the amendment does not apply to the extent (if any) to which its operation would result in an acquisition of property (within the meaning of paragraph 51(xxxi) of the Constitution) from a person otherwise than on just terms (within the meaning of that paragraph).

3  Subsection 51(3) of Schedule 1

Repeal the subsection.