Supplementary Explanatory Memorandum
(Circulated by authority of the Treasurer, the Hon. P.J. Keating, M.P.)NOTES ON CLAUSE
Clause 55A, as proposed to be inserted in the Bill by the amendment, will modify the operation of subsection 160AAA(l) of the Assessment Act. That subsection authorises a rebate of income tax, known as a pensioner rebate, for a taxpayer whose assessable income includes a social security or repatriation pension that is taxable in Australia. The maximum rebate allowed is $250, available to a taxpayer whose taxable income does not exceed $6142. The rebate shades out at the rate of 12.5 cents for each $1 of taxable income in excess of $6142.
Clause 55A will apply to a taxpayer whose assessable income in the 1987-88 income year includes a service pension paid under Part III of the Veterans' Entitlements Act 1986. For such a taxpayer, the clause provides that the maximum pensioner rebate for the 1987-88 income year is to be $308 if the taxpayer's taxable income in that year does not exceed $6384. Where the taxpayer's taxable income exceeds $6384, the rebate is to be reduced by 12.5 cents for each $1 of taxable income in excess of $6384. No rebate will be available for a service pensioner whose taxable income in 1987-88 exceeds $8847.