House of Representatives

Explanatory Memorandum

(Circulated by authority of the Treasurer,the Hon. Peter Costello, MP)

Chapter 3 - The new numbering system

This chapter explains the new numbering system adopted in the Income Tax Assessment Bill 1996, and how that system will overcome problems with the present numbering system.

Overview of this chapter

This chapter discusses the new numbering system proposed for the new Income Tax Assessment Act.

Problems with the old numbering system

Amendments of the existing law have overloaded its numbering system, so that the Income Tax Assessment Act 1936 included section numbers such as 159GZZZZH. Numbers like this confuse and disorient readers, and waste their time in locating material.

These awkward results happen because of limitations caused by the existing structure of the law. Most new law affecting liability to income tax used to be inserted between sections 158 and 161 of the Income Tax Assessment Act 1936 . More recently, new law has just been added to the end of the Act.

If the law was renumbered using the existing numbering system this would not provide sufficient flexibility to avoid the same numbering problem arising again over time. Consequently, the Bill adopts a new numbering system that has been carefully designed to minimise the possibility that the old problems will recur.

Aims of the new numbering system

The new numbering system sets out to meet the following ideals:

•

Each unit of law should have a unique number to identify it.

•

For any two numbers in the system, it should be immediately apparent which one is higher.

•

Numbers should be easy to read.

•

Numbers should be able to be said aloud without being ambiguous.

•

The system should flow naturally and be predictable.

•

Each number should identify the area of law to which it belongs.

•

It should cope well if a large amount of new material is inserted later.

Main features of the new numbering system

Section numbers will have two components

Section numbers will have two components, separated by a dash. The first component will be the number of the Division in which the section is located. The second component will be the number of the section within the Division.

Example:

Section 601-22 shows that it is a section of Division 601.

Each Division will number its sections, starting from one.

Example:

The first section of Division 600 will be section 600-1.

The first section of Division 601 will be section 601-1.

Section numbers will be separated with gaps. Except for the first section in a Division, section numbers will run in multiples of 5, to allow new sections to be inserted without using alpha characters.

Example:

43-1, 43-5, 43-10.

Part and Division numbers will run in sequence, with gaps

Unlike section numbers, Part and Division numbers will run in sequence through the new law. They will not start again, at one, with the start of each new Part (or chapter).

After the last Division in a Part, or the last Part in a Chapter, the new law will usually leave a gap (of five numbers) in the sequence of Division and Part numbers. By keeping numbers in reserve, when new Divisions and Parts are inserted they will not interrupt the flow by extensively using combinations of numbers and alpha characters as the present law does.

Part numbers will identify chapter numbers

Part numbers will identify the Chapters in which the Parts are located.

Example:

Part 5-10 means Part 10 of Chapter 5.

Clearer cross references

In the new law, cross references to other provisions of the law will usually specify the heading or title of the provision, as well as its number.

Example:

See section 10-5 (List of provisions about assessable income).

Details of the new numbering system

Chapters will have a single component number.

Example:

Chapter 5.

Parts will be numbered in components separated by a dash. The first number will refer to the Chapter, the second will refer to the Part.

Example:

Part 5-10 shows that it is Part 10 within Chapter 5.

Divisions will have a single component number.

Example:

Division 600.

Subdivisions will be numbered in components separated by a dash. The first component is the number of the Division. The second component is a capital letter, identifying the Subdivision, in the sequence A, B, C, etc.

Example:

Subdivision 5-A is Subdivision A of Division 5.

Sections will have two components, separated by a dash. The first component will be the number of the Division in which the section is located. The second component will be the number of the section.

Example:

Section 601-2 is the second section in Division 601.

There will be no change to the way subsections, paragraphs and sub-paragraphs are numbered. However:

•

there will be fewer subsections in a section;

•

paragraphs will be less frequently divided into subparagraphs; and

•

sub-subparagraphs will not be used.

How the numbering system will cope with new material

The Bill leaves gaps in the sequence of both Division and section numbers. That will allow space for parts of the law that will be rewritten in later stages as the new Act is built up progressively.

Gaps will also be left, deliberately, to cope with the insertion of extra material in the future without having to clutter the law with Division and section numbers that also include multiple letters (like section 160ARXA).

Gaps will not guarantee against eventually needing recourse to section and Division numbers that include letters, but they will significantly postpone this eventuality and the possible incidence of it.

The following examples illustrate how new material could be inserted in the law if required: