Bills Digest No. 109   1997-98 Family Trust Distribution Tax (Primary Liability) Bill 1997


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WARNING:
This Digest was prepared for debate. It reflects the legislation as introduced and does not canvass subsequent amendments. This Digest does not have any official legal status. Other sources should be consulted to determine the subsequent official status of the Bill.

CONTENTS

Passage History

Family Trust Distribution Tax (Primary Liability) Bill 1997

Date Introduced: 1 October 1997
House: House of Representatives
Portfolio: Treasury
Commencement: Royal Assent

Purpose

To impose tax on distributions by family trusts to people who are not members of the family group for the trust and to set the rate of that tax.

Background

The Taxation Laws Amendment (Trust Loss and Other Deductions) Bill 1997 proposes to impose tax on a family trust that makes a distribution outside the allowable family group. It is proposed that the rate of tax will be 48.5%, the highest marginal rate including the Medicare levy, on any distribution made outside the family group. This Bill is necessary as section 55 of the Constitution requires that a Bill imposing tax deal only with the imposition of tax. This Bill will impose formally the tax on distributions outside the family group.

For further information on the general issue of family trusts, refer to the Digest for the Taxation Laws Amendment (Trust Loss and Other Deductions) Bill 1997.

Main Provisions

Clause 3 of the Bill will impose formally the tax on distributions outside the family group.

Clause 4 will set the rate of tax at 48.5%.

Contact Officer and Copyright Details

Chris Field
19 November 1997
Bills Digest Service
Information and Research Services

This paper has been prepared for general distribution to Senators and Members of the Australian Parliament. While great care is taken to ensure that the paper is accurate and balanced, the paper is written using information publicly available at the time of production. The views expressed are those of the author and should not be attributed to the Information and Research Services (IRS). Advice on legislation or legal policy issues contained in this paper is provided for use in parliamentary debate and for related parliamentary purposes. This paper is not professional legal opinion. Readers are reminded that the paper is not an official parliamentary or Australian government document.

IRS staff are available to discuss the paper's contents with Senators and Members
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ISSN 1328-8091
© Commonwealth of Australia 1997

Except to the extent of the uses permitted under the Copyright Act 1968, no part of this publication may be reproduced or transmitted in any form or by any means, including information storage and retrieval systems, without the prior written consent of the Parliamentary Library, other than by Members of the Australian Parliament in the course of their official duties.

Published by the Department of the Parliamentary Library, 1997.

This page was prepared by the Parliamentary Library, Commonwealth of Australia
Last updated: 21 November 1997

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