Senate
Tax Law Improvement Bill (No. 1) 1998
Explanatory Memorandum
(Circulated by authority of the Treasurer, the Hon Peter Costello, MP)CHANGE OF TITLE - TAX LAW IMPROVEMENT BILL (No. 1) 1998 - SENATE - Explanatory Memorandum.
The Tax Law Improvement Bill (No. 2) 1997 has been retitled the Tax Law Improvement Bill (No. 1) 1998. All references in this explanatory memorandum that refer to Tax Law Improvement Bill (No. 2) 1997 should now read Tax Law Improvement Bill (No. 1) 1998.
THIS MEMORANDUM TAKES ACCOUNT OF AMENDMENTS MADE BY THE HOUSE OF REPRESENTATIVES TO THE BILL AS INTRODUCED
Chapter 2.29 - Consequential amendments of the Income Tax Assessment Act 1936
This Chapter explains the consequential amendments of the Income Tax Assessment Act 1936 required as a result of the rewriting of the CGT provisions.
The amending items 49 to 522 are in Part 3 of Schedule 2.
What Part 3 of Schedule 2 does
Part 3 of Schedule 2 to the Bill amends the 1936 Act as a consequence of the rewrite of the CGT provisions.
The amendments made by the items in Part 3 of Schedule 2 are identified and classified as follows:
- •
- Insert 3 new sections into the 1936 Act that will ensure the continued operation of Divisions 17A, 17B and 19A of Part IIIA
- Item numbers: 397, 398, 399
- •
- Replace references to 1936 Act provisions with 1997 Act references
- Item numbers: 63, 91, 101, 108, 114, 135, 145, 150, 206, 217, 272, 281, 298, 299, 300, 301, 302, 308, 309, 310, 311, 312, 314, 318, 325, 326, 327, 328, 329, 330, 331, 354, 361, 373, 374, 381, 400, 404, 405, 407, 408, 421, 422, 447, 448, 455, 456, 457, 458, 475, 510, 519
- •
- Replace references to Part IIIA with references to new Parts 3-1 and 3-3
- Item numbers: 87, 89, 95, 96, 104, 105, 106, 107, 110, 111, 112, 113, 115, 116, 118, 220, 283, 323, 341, 342, 343, 345, 362, 363, 367, 377, 378, 380, 382, 384, 385, 386, 418, 423, 431, 450, 451, 521
- •
- Replace references Part IIIA with either a reference to Part 3-1 or to Part 3-3 as appropriate
- Item numbers: 72, 76, 77, 78, 82, 83, 84, 85, 97, 98, 99, 332, 403, 414
- •
- Replace certain references to Part IIIA with references to the Income Tax Assessment Act 1997
- Item numbers: 128, 129
- •
- Replace a reference to 'the Act' with 'this Act'
- Item number: 430
- •
- Replace references to Part IIIA concepts with references to Parts 3-1 and 3-3 concepts
- Item numbers: 64, 65, 66, 67, 68, 69, 70, 71, 73, 74, 75, 79, 80, 81, 88, 90, 92, 94, 102, 109, 117, 119, 122, 123, 124, 125, 134, 136, 140, 146, 147, 151, 152, 153, 158, 159, 160, 161, 162, 163, 167, 168, 169, 174, 177, 178, 181, 184, 185, 186, 189, 190, 191, 192, 193, 194, 195, 196, 197, 198, 199, 200, 201, 202, 203, 204, 205, 207, 208, 209, 210, 211, 212, 213, 214, 215, 218, 219, 221, 222, 223, 228, 229, 230, 231, 234, 235, 240, 241, 244, 245, 248, 253, 254, 255, 256, 257, 258, 259, 260, 261, 262, 263, 264, 265, 266, 267, 268, 269, 270, 271, 273, 274, 275, 276, 277, 278, 279, 282, 284, 285, 287, 288, 290, 291, 293, 294, 296, 303, 304, 306, 313, 317, 321, 324, 333, 334, 335, 344, 346, 347, 348, 349, 351, 352, 353, 355, 356, 357, 358, 359, 368, 369, 370, 371, 372, 375, 376, 379, 383, 387, 410, 411, 415, 417, 420, 424, 426, 427, 428, 437, 438, 444, 445, 446, 449, 452, 459, 462, 471, 498, 499, 500, 502, 503, 504, 507, 508, 509, 511, 513, 514, 515, 516, 517, 518, 520, 522
- •
- Insert references to rewritten provisions
- Item numbers: 93, 148, 389, 390, 391, 401, 425, 429, 433, 434, 435, 436, 439, 440, 441, 442, 443, 460, 464, 466, 467, 468, 469, 473, 474, 476, 477, 478, 479, 480, 481, 482, 483, 484, 485, 486, 487, 488, 489, 490, 491, 492, 493, 494, 495, 496, 497
- •
- Substitute references to defined terms
- Item numbers: 49, 50, 51, 52, 53, 54, 55, 56, 57, 58, 59, 60, 61, 62, 137, 144
- •
- Update references to roll-over provisions
- Item numbers: 126, 130, 132, 139, 142, 143, 286, 338, 465, 472
- •
- Improve the wording of provisions
- Item numbers: 121, 133, 289, 292, 295, 297, 305, 307, 315, 316, 319, 320, 402, 406, 416, 432, 470, 501, 505, 512
- •
- Insert application provisions
- Item numbers: 392, 393, 394, 395, 396
- •
- Repeal redundant provisions or expressions
- Item numbers: 86, 103, 120, 127, 138, 141, 149, 154, 155, 156, 157, 164, 165, 166, 170, 171, 172, 173, 175, 176, 179, 180, 182, 183, 187, 188, 216, 224, 225, 226, 227, 232, 233, 236, 237, 238, 239, 242, 243, 246, 247, 249, 250, 251, 252, 280, 336, 337, 340, 350, 360, 364, 365, 366, 388, 409, 412, 413, 419, 453, 454, 461, 463, 506
- •
- Add or replace link notes
- Item numbers: 100, 322, 339
Definitions used in Division 8 - Life Assurance Companies
Subsection 110(1) of the 1936 Act contains the definitions of terms used in the provisions relating to life assurance companies. Items 151 to 191 of Schedule 2 contain amendments to these defined terms.
The following table matches the existing terms which are being repealed with the corresponding new terms.
| Existing defined term | Amended defined term |
|---|---|
| modified 25/25A amount [item 154] | modified ordinary income amount [item 160] |
| modified 51/52 amount [item 155] | modified general deduction [item 159] |
| modified 160Z gain amount [item 156] | non-exempt modified capital gain [item 161] |
| modified 160Z loss amount [item 157] | modified capital loss [item 158] |
| notional Part IIIA disposal [item 164] | notional CGT event [item 167] |
| notional Part IIIA disposals deduction [item165] | notional CGT event deduction [item168] |
| notional Part IIIA disposals income [item 166] | notional CGT event income [item 169] |
| ordinary 25/25A amount [item 170] | unmodified ordinary income amount [item 191] |
| ordinary 51/52 amount [item 171] | unmodified general deduction [item190] |
| ordinary 160Z gain amount [item 172] | non-exempt ordinary capital gain [item162] |
| ordinary 160Z loss amount [item 173] | ordinary capital loss [item 174] |
| overall 160Z gain [item 175] | overall non-exempt capital gain [item 178] |
| overall 160Z loss [item 176] | overall capital loss [item 177] |
| prior year Part IIIA loss [item 179] | accumulated net capital loss [item 151] |
| residual overall 160Z gain [item 180] | residual overall non-exempt capital gain [item181] |
| total modified 160Z gain amount [item 182] | total non-exempt modified capital gain [item 185] |
| total modified 160Z loss amount [item 183] | total modified capital loss [item 184] |
| total ordinary 160Z gain amount [item 187] | total non-exempt ordinary capital gain [item 186] |
| total ordinary 160Z loss amount [item 188] | total ordinary capital loss [item 189] |
Definitions used in Division 8A - Annuity and insurance business of certain organisations
Subsection 116E(1) of the 1936 Act contains the definitions of terms used in the provisions relating to the annuity and insurance business of certain organisations. Items 222 to 258 of Schedule 2 contain amendments to these definitions.
The following table matches the existing terms which are being repealed with the corresponding new terms.
| Existing defined term | Amended defined term |
|---|---|
| modified 25/25A amount [item 224] | modified ordinary income amount [item 231] |
| modified 51/52 amount [item 225] | modified general deduction [item 230] |
| modified 160Z gain amount [item 226] | modified capital gain [item 228] |
| modified 160Z loss amount [item 227] | modified capital loss [item 229] |
| notional Part IIIA disposal [item 232] | notional CGT event [item 234] |
| notional Part IIIA disposals deduction [item233] | notional CGT event deduction [item 235] |
| ordinary 25/25A amount [item 236] | unmodified ordinary income amount [item 258] |
| ordinary 51/52 amount [item 237] | unmodified general deduction [item 257] |
| ordinary 160Z gain amount [item 238] | ordinary capital gain [item 240] |
| ordinary 160Z loss amount [item 239] | ordinary capital loss [item 241] |
| overall 160Z gain [item 242] | overall capital gain [item 244] |
| overall 160Z loss [item 243] | overall capital loss [item 245] |
| prior year Part IIIA loss [item 246] | accumulated net capital loss [item 222] |
| residual overall 160Z gain [item 247] | residual overall capital gain [item 248] |
| total modified 160Z gain amount [item 249] | total modified capital gain [item 253] |
| total modified 160Z loss amount [item 250] | total modified capital loss [item 254] |
| total ordinary 160Z gain amount [item 251] | total ordinary capital gain [item 255] |
| total ordinary 160Z loss amount [item 252] | total ordinary capital loss [item 256] |