Supplementary Explanatory Memorandum
(Circulated by the authority of the Treasurer, the Hon. J. Kerin, M.P.)Summary of proposed amendments
A number of amendments to the Bill are to be moved on behalf of the Government. These amendments relate to the calculation of provisional tax in respect of 1991-92 for certain taxpayers and the changes to the imputation system proposed by the Bill.
The amendments also include an amendment to the CGT provisions of the Income Tax Assessment Act 1936 (the Principal Act) to enable taxpayers to realise capital losses on valueless shares held in companies in liquidation.
Provisional tax amendments
The changes proposed to the provisional tax amendments in the Bill will simplify the calculation of provisional tax for those taxpayers with a shortfall of at least $3000 in pay-as-you-earn tax deductions from 1990-91 salary or wages income.
Imputation changes
The effects of the proposed amendments to the imputation arrangements are:
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- when an assessment is made, life assurance companies will receive further franking debits and credits in respect of-
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- initial payments of tax,
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- further payments of tax and
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- refunds of initial payments of tax.
Capital gains tax amendment
The proposed amendment will allow shareholders in companies in liquidation to realise capital losses on their shares if the liquidator has indicated that there is no likelihood of shareholders receiving a distribution in the course of winding up the company.
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