House of Representatives
Income Tax Assessment Amendment (Foreign Investment) Bill 1992
Explanatory Memorandum
(Circulated by the authority of the Treasurer, the Hon John Dawkins, M.P.)Exemption for Interest in Certain Foreign Trusts
Overview
Investment through trusts to countries which prohibit direct investment on stock exchanges in those countries will be excluded from the FIF measures. This will ensure that Australian investors are not disadvantaged by investing in emerging markets through country fund trusts listed in free-market countries.
Explanation
A taxpayer is exempt from the FIF measures in respect of an interest in certain specified foreign trusts established in India, the Republic of Korea or Taiwan. These countries prohibit direct foreign investment on their stock exchanges. The list of approved trusts is in Schedule 6. [Section 513]