Assistant Treasurer Josh Frydenberg has announced that the Government will give the Commissioner of Taxation the power to change the operation of taxation and superannuation laws.
Mr Frydenberg said “the Government is committed to providing more certainty and better outcomes for taxpayers and reducing the regulatory burden on individuals, business and community organisations.”
However the complex nature of Australian tax law “increasingly” leads to unintended outcomes. Though, to an extent, the ATO can interpret laws in line with the original of objectives “there are instances where this is not possible.”
“To address this, the Government will provide the Commissioner with a statutory remedial power to allow for a more timely resolution of certain unforeseen or unintended outcomes in the taxation and superannuation law,” said Mr Frydenberg.
The Government intends to give the Commissioner the power to make ‘disallowable legislative instruments’, which will “have the effect of modifying the operation of the taxation and superannuation law to ensure the law can be administered to achieve its purpose or object.”
Mr Frydenberg points out that similar powers have already been granted to APRA and ASIC.
“The power will be appropriately limited in its application and will only apply to the extent that it has a beneficial outcome for taxpayers,” he said.
“It will only be available where the modification is not inconsistent with the purpose or object of the law and has no more than a negligible revenue impact.”
The Commissioner of Taxation will consult publicly prior to the use of the new power, though it is unclear if this will be a requirement or simply practice.
“This power provides a mechanism to deal with some aspects of complexity in the tax law, and provides more certainty and better outcomes for taxpayers,” Mr Frydenberg said.
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