Taxation Laws Amendment (Superannuation) Act 1993 (7 of 1993)

PART 3   AMENDMENT OF THE INCOME TAX RATES ACT 1986

Division 2   Amendments relating to the tax treatment of the excessive component of ETPs

39   Schedule 9

Schedule 9 to the Principal Act is amended:

(a) by omitting clause 1 of Part I and substituting the following clause:

"1. Subject to clause 2, the rates of tax on the taxable income of a resident taxpayer deriving a notional income as specified by section 59AB or 86 of the Assessment Act are as follows:

(a) for the EC part of the taxable income-47%;

(b) for every $1 of the ordinary taxable income-the amount worked out using the formula:

Tax at ordinary rates on non-EC notional income / Number of dollars in the non-EC notional income

where:

'Tax at ordinary rates on non-EC notional income' means the tax that would be payable under clause 1 of Part I of Schedule 7 on an ordinary taxable income equal to the non-EC notional income;

'Number of dollars in the non-EC notional income' means the number of whole dollars in the non-EC notional income;

In this clause, 'non-EC notional income' means the amount that would have been the notional income as specified by section 59AB or 86 of the Assessment Act if that notional income had been calculated by reference to ordinary taxable income instead of by reference to taxable income.";

(b) by adding at the end of clause 2 of Part I:

"In applying the formula, component B is to be worked out on the assumption that the whole of the taxable income is ordinary taxable income.";

(c) by omitting clause 1 of Part II and substituting the following clause:

"1. Subject to clause 2, the rates of tax on the taxable income of a non-resident taxpayer deriving a notional income as specified by section 59AB or 86 of the Assessment Act are as follows:

(a) for the EC part of the taxable income-47%;

(b) for every $1 of the ordinary taxable income-the amount worked out using the formula:

Tax at ordinary rates on non-EC notional income / Number of dollars in the non-EC notional income

where:

'Tax at ordinary rates on non-EC notional income' means the tax that would be payable under clause 1 of Part II of Schedule 7 on an ordinary taxable income equal to the non-EC notional income;

'Number of dollars in the non-EC notional income' means the number of whole dollars in the non-EC notional income;

In this clause, 'non-EC notional income' means the amount that would have been the notional income as specified by section 59AB or 86 of the Assessment Act if that notional income had been calculated by reference to ordinary taxable income instead of by reference to taxable income.";

(d) by adding at the end of clause 2 of Part II:

"In applying the formula, component B is to be worked out on the assumption that the whole of the taxable income is ordinary taxable income.".