Identifying Inoperative Provisions of the 1936 and 1997 Income Tax Assessment Acts


In early 2005, the Board of Taxation engaged two consultants to identify the inoperative provisions of the two Income Tax Assessment Acts.

This followed consultancy work undertaken for the Board in 2004 by Mr Tom Reid which resulted in a list of provisions of the 1936 and 1997 Income Tax Assessment Acts that may have been inoperative (ie, the provision has no application) either because they have no effect after a date in the past or because all the transactions they did affect have now concluded.

The work conducted by the Australian Taxation Studies Program (Atax) at The University of New South Wales and SoftLaw Corporation Limited checked the ‘candidate inoperative provisions’ identified in 2004 to confirm they have no residual operation and there would be no unintended consequences if the provisions were to be repealed.

Government Action

The then Treasurer’s press release on this issue of 24 November 2005, announced that the Government will undertake further consultation on the draft legislation to repeal the inoperative provisions. On 4 April 2006 the Treasurer announced the release of draft legislation to repeal these inoperative provisions and invited public comment on the draft legislation.

The then Treasurer also released the Board’s Report on the ‘Identification and possible repeal of the inoperative provisions of the 1936 and 1997 Income Tax Assessment Acts’.

Following consultation on the draft legislation, The Treasurer introduced the Tax Laws Amendment (Repeal of Inoperative Provisions) Bill 2006 into Parliament on 22 June 2006.

The Bill was passed, without amendment, by both Houses of Parliament and received Royal Assent on 14 September 2006. The amending legislation, the Tax Laws Amendment (Repeal of Inoperative Provisions) Act 2006repealed more than 4,100 pages of Australia’s tax legislation.

For further information please contact the Board of Taxation Secretariat on (02) 6263 4366 or at