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Media Release 1919/05/2008

Review of Australia’s Foreign Source Income Anti-Tax Deferral Regimes

The Chairman of the Board of Taxation, Mr Dick Warburton, today announced the release of the Board’s issues papers on possible reforms to Australia’s foreign source income anti-tax-deferral regimes (the controlled foreign company rules, the foreign investment fund rules, the transferor trust rules and the deemed present entitlement rules).

These issues papers complement the Board’s position paper on the review of the anti-tax-deferral regimes which was released on 12 March 2008. That paper indicated the Board’s considered views on the high level principles that should apply in the future design of the foreign source income attribution rules. The position paper also advised that the Board would be releasing several issues papers to assist with further consultation.

The Board considers the principles set out in these papers provide a framework to reduce compliance costs and complexity while not inhibiting the ability of Australian businesses to compete globally.

These issues papers, which should be read together with the Board’s discussion and position papers, cover the following topics:

The Board invites comment on any of the proposals contained in the position paper, but, in releasing these issues papers, the Board also wishes to provide industry with more detailed proposals on which to comment. The Board also seeks to focus attention on what it considers to be the main issues requiring development. This will allow submissions and consultations to better consider the substantive design issues and practicalities of the proposals.

To assist in the Review process, the Board is holding consultation forums in Melbourne on Monday 26 May 2008 and in Sydney on Friday 30 May 2008. Interested parties should register their interest in attending these forums by email at taxboard@treasury.gov.au. Further targeted consultations may be held with those who wish to discuss specific issues. Submissions should be sent by email to taxboard@treasury.gov.au or by facsimile to (02) 6263 4471. The closing date for submissions is 20 June 2008. Submissions should include contact details so that, if required, the Board can contact those making submissions to discuss the points raised.

Copies of the Board’s issues papers, the position paper and the discussion paper are available from www.taxboard.gov.au. Printed versions of the papers are available by email request sent to taxboard@treasury.gov.au, or by phoning Mr Vernon Joice on (02) 6263 4369.