Notes for the Minister's Second Reading Speech
This Bill is the third of three measures designed to correlate the Commonwealth income tax law with the Income Tax Ordinance of the Territory of Papua and New Guinea.
The proposed amendments of the Income Tax (International Agreements) Act relate to credits allowed under international agreements to relieve double taxation by Australia and the countries with which those agreements have been made, namely, the United Kingdom, Canada and the United States of America.
The Act contains a number of machinery provisions relating to the determination and application of credits and to taxpayers' rights of objection and appeal on these matters. Corresponding provisions in the Income Tax and Social Services Contribution Assessment Act are now required consequent upon the proposed allowance to Australian residents of credits for tax paid on income derived in the Territory of Papua and New Guinea. These provisions will be inserted in that Act by the Income Tax and Social Services Contribution Assessment Bill on which I have already spoken and they will also be effective in relation to credits provided under international agreements. The provisions in the Income Tax (International Agreements) Act will accordingly become redundant and their repeal is proposed by the present Bill.
Drafting amendments are also proposed in provisions governing the upper limit of the credits authorised by the international agreements and in a provision setting out the formula for determining the Australian tax payable on a dividend.
As each amendment is explained in the memorandum being made available to Honourable Senators I have not thought it necessary at this stage to embark upon more detailed comments on provisions of the Bill.
I commend the Bill to Honourable Senators.