House of Representatives

Explanatory Memorandum - PART I

(Circulated by authority of the Treasurer, the Hon. John Howard, M.P.)

Introductory note

Part I of this memorandum contains explanations designed to provide a broad guide to the legislation that has been introduced to give effect to the company tax recoupment measures foreshadowed in Ministerial statements of 25 July 1982 and 17 August 1982, and to an associated Bill. Part II of the memorandum will contain a clause by clause explanation of the Bills.

There are three Bills for the purpose of recouping evaded company tax:

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The Taxation (Unpaid Company Tax) Assessment Bill 1982 which sets out the basic conditions of liability and contains necessary machinery measures.

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The Taxation (Unpaid Company Tax) Bill 1982 is a "Rates" Bill which formally imposes a tax of the amount established by the first Bill.

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The Taxation (Unpaid Company Tax) (Consequential Amendments) Bill 1982 which makes changes to several other Acts consequent upon the first Bill.

An associated Bill - the Income Tax Assessment Amendment (Additional Tax) Bill 1982 - provides for an increase from 10% per annum to 20% per annum in additional tax for late payment of income tax and limits the Commissioner of Taxation's powers to remit that additional tax to certain specified circumstances.