EXPLANATORY NOTES
(Circulated by the Treasurer, the Hon. B.M. Snedden, Q.C., M.P.)Introductory Note
The provisions of the Income Tax Bill 1972 were explained in the Explanatory Memorandum that was circulated for the information of Honourable Members when the Bill was introduced in the House on 9 December 1971.
The purpose of these notes is to explain the amendments that are now proposed. These relate to both subjects of the Bill, viz., provisions concerning rebates on inter-company dividends and provisions concerning conditions under which a company is to be treated as a public company for income tax purposes.
Very broadly, the amendments will incorporate in the rebate measures guidelines relating to the identification by the Commissioner of Taxation of the sort of operations to be treated as dividend stripping. For the public company subsidiary tests, the amendments will remedy technical deficiencies in the Bill as it would otherwise apply to some companies that have adopted irregular accounting periods for income tax purposes.