The ATO has released some details about the new power to modify the operation of tax and superannuation laws.
First announced by the Assistant Treasurer, and then included in the 2015 Budget, the Statutory Remedial Power will “provide the Commissioner of Taxation with a power to make a legislative instrument to modify the operation of the tax law to ensure that the law’s purpose or object is achieved.”
The budget papers say “the nature and volume of tax law and its evolution has sometimes produced unforeseen or unintended outcomes when applied.”
“The statutory remedial power will allow the Commissioner to administer the law consistently with its purpose or object, where it has no more than a negligible budget impact and provided it has a beneficial outcome for affected taxpayers. This measure will reduce the regulatory burden on taxpayers by enhancing certainty.”
The ATO says the Statutory Remedial Power will provide a “more timely resolution” of legislative issues, increased flexibility in dealing with legislative problems “which cannot be resolved by way of interpretation” while reducing the regulatory burden and providing “more certainty and better outcomes for taxpayers.”
These legislative instruments will be disallowable by the Parliament.
According to the ATO the Commissioner of Taxation will consult publicly prior to making any legislative instrument under the Statutory Remedial Power.
“The Government has not yet announced when legislation for this measure will be developed. At the time legislation is developed, the ATO will establish processes for external stakeholders to raise legislative issues they consider may be appropriate to be resolved by the statutory remedial power,” said an ATO statement.
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