Bills Digest no. 83 2015–16
PDF version [2.7MB]
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.
Kai Swoboda
Economics Section
23 February 2016
Contents
Purpose
of the Bill
Background
Committee consideration
Policy position of non-government parties/independents
Position of major interest groups
Financial implications
Statement of Compatibility with Human Rights
Key issues and provisions
Date introduced: 3
December 2015
House: House of
Representatives
Portfolio: Treasury
Commencement: Provisions
generally commence the day after Royal Assent. However there are also
contingent provisions, the commencement, or otherwise, of which depend on the
passage of other legislation.
Links: The links to the Bill,
its Explanatory Memorandum and second reading speech can be found on the
Bill’s home page, or through the Australian
Parliament website.
When Bills have been passed and have received Royal Assent, they
become Acts, which can be found at the ComLaw
website.
The purpose of the Tax Laws Amendment (Implementation of the
Common Reporting Standard) Bill 2015 (the Bill) is to implement an
international framework (the Common Reporting Standard (CRS)) endorsed by over
90 jurisdictions. The Government has committed to implement this framework
from 2017. The CRS requires certain financial institutions to report
information to local tax authorities on foreign resident account holders under
the Multilateral Competent Authority Agreement on Automatic Exchange of
Financial Account Information.
The Bill amends the Taxation Administration Act 1953
to:
- require
financial institutions to carry out CRS due diligence procedures to identify
reportable accounts held by foreign tax residents and provide statements about
those accounts
- require
financial institutions to provide a statement in relation to certain accounts
if they receive a notice requiring them to do so
- provide
for administrative penalties when financial institutions fail to collect
account holder self-certifications about the jurisdiction of residence for tax
purposes and
- require
financial institutions to keep records for at least five years that explain the
procedures used for identifying reportable accounts.
The Bill also makes consequential amendments to the Income
Tax Assessment Act 1997 and the Tax and Superannuation Laws Amendment
(2015 Measures No. 5) Act 2015.
What is the Common Reporting
Standard?
The Common Reporting Standard for the automatic exchange
of financial account tax information (CRS) provides a common international
standard for:
- the
collection of financial account information by financial institutions in
participating jurisdictions on account holders who are residents in another
jurisdiction
- the
reporting of that information to the jurisdictions’ tax authority and
- the
exchange of that information with the respective tax authorities of the
non-residents.[1]
The CRS was developed by the Organisation for Economic
Cooperation and Development (OECD) and non-OECD Group of Twenty (G20) countries
at the request of the G20, to tackle and deter cross-border tax evasion.[2]
It was endorsed by G20 leaders at their meeting on 15 and 16 November 2014 in
Brisbane, when it was noted:
To prevent cross-border tax evasion, we endorse the global
Common Reporting Standard for the automatic exchange of tax information (AEOI)
on a reciprocal basis. We will begin to exchange information automatically with
each other and with other countries by 2017 or end-2018, subject to completing
necessary legislative procedures. We welcome financial centres’ commitments to
do the same and call on all to join us. We welcome deeper engagement of
developing countries in the BEPS [Base Erosion and Profit Shifting][3]
project to address their concerns. We will work with them to build their tax
administration capacity and implement AEOI. We welcome further collaboration by
our tax authorities on cross-border compliance activities.[4]
The final CRS was approved by the OECD Council on 15 July
2014.[5]
The OECD document, the Standard
for Automatic Exchange of Financial Account Information in Tax Matters,
is directly referred to in the Bill, which incorporates the key concepts and
definitions for the implementation of the CRS.[6]
Under the CRS, certain financial institutions will be
required to undertake processes—referred to as ‘due diligence procedures’—to
identify and report certain account information for foreign resident taxpayers.
The flow of information under the CRS about accounts held
by foreign residents is illustrated in Figure 1. Under the arrangements,
certain financial institutions report information about the accounts of foreign
residents to their tax administrator (in Australia’s case the Australian
Taxation Office), who is then able to send this information, subject to certain
agreements being in place, to tax administrators in other countries.
Figure 1: The reciprocal
automatic exchange framework
Source: OECD, Standard
for automatic exchange of financial information in tax matters: Implementation handbook,
OECD Publishing, Paris, 7 August 2015, p. 7, accessed 4 February
2016.
Multilateral approaches to tackle
cross border tax minimisation and tax avoidance
There has been growing momentum by governments to address
the issue of cross border tax minimisation and tax avoidance. The CRS has been
one important outcome of international efforts.
The Australian Government has been involved in the G20 forum
which has been seeking to address multinational corporate tax avoidance. At the
request of the G20, the OECD published its Action Plan on Base Erosion and
Profit Shifting (Action Plan) in July 2013.[7]
At the G20 Summit in Brisbane in November 2014, Australia
committed to the G20 and OECD’s BEPS Action Plan which is designed to
‘modernise international tax rules’ and address multinational corporate tax
evasion.[8]
In early September 2015, the Treasurer met with the G20
finance ministers, recommitting to working with the other G20 nations to reduce
multinational tax avoidance and profit shifting.[9]
Some of the key developments relating to recent
multilateral approaches to addressing cross-border taxation are summarised in Table
1.
Table 1: Key developments relating to Australia’s recent international
approaches to addressing cross-border taxation
Date
|
Development
|
September 2012
|
Australia’s transfer pricing rules amended and aligned to
the OECD Transfer Pricing Guidelines. The new rules applied retrospectively
from 1 July 2004.
|
June 2013
|
OECD released 15 point Action Plan on Base Erosion and
Profit Shifting (BEPS) to be delivered by end 2015.
|
July 2013
|
G20 Finance Ministers’ meeting endorsed the Action Plan
and the establishment of the OECD/G20 BEPS project.
|
April 2014
|
Australia and the United States signed an
intergovernmental agreement to implement the US’s Foreign Account Tax
Compliance Act (FATCA) in Australia. The agreement entered into force on 30
June 2014.
|
September 2014
|
OECD delivered first tranche of recommendations from the
BEPS Action Plan, which was endorsed by G20 Finance Ministers. The Treasurer
released a ministerial statement on G20-OECD Tax and Transparency. The
Government announced implementation of Common Reporting Standard for the
automatic exchange of financial account information from 2017 to deal with
tax evasion.
|
October 2014
|
Changes to tighten the thin capitalisation safe harbour
limits and close a loophole to ensure that the foreign non-portfolio dividend
exemption for Australian companies only applies to returns on equity. Both
measures were announced but not implemented by the former Government.
|
November 2014
|
G20 Leaders endorsed the first tranche of the OECD’s
recommendations from the BEPS Action Plan, delivered under Australia’s G20
Presidency
|
May 2015
|
Australia announced action on four key BEPS Actions:
- legislation
to implement county-by-country reporting (Action 13)
- adoption
of the BEPS treaty abuse rules (Action 6)
- the
Board of Taxation to consult on the implementation of anti-hybrid rules
(Action 2)
- the
Australian Taxation Office commenced exchange of information on tax
arrangements provided to multinationals by other countries (Action 5).
|
June 2015
|
Australia signed the OECD’s common reporting standard
multilateral competent authority agreement to catch taxpayers using hidden
offshore bank accounts to evade Australian tax.
|
July 2015
|
Stronger penalties started to apply to tax benefits
obtained through a tax avoidance or profit shifting scheme.
|
October 2015
|
OECD released final BEPS recommendations. Endorsed by G20
Finance Ministers.
|
January 2016
|
Australian Government signed multilateral agreement to
share information on multinational transfer pricing arrangements.
|
Source: S Morrison (Treasurer), OECD
report supports Australian Government action on multinational tax avoidance,
media release, 6 October 2015; S Morrison (Treasurer) and K O’Dwyer
(Assistant Treasurer), Coalition
bolsters ATO in fight against multinational tax avoidance, joint media
release, 28 January 2016; OECD, G20
finance ministers endorse reforms to the international tax system for curbing
avoidance by multinational enterprises, media release, 9 October
2015, all accessed 10 February 2016.
Foreign Account Tax Compliance Act
The development of the CRS was largely based on the
implementation by the United States (US) of the Foreign Account Tax
Compliance Act (FATCA). Implemented on a unilateral basis by the United
States, FATCA was developed to reduce offshore tax evasion and regain federal
tax revenues from American account holders at foreign (non-American) financial
institutions internationally.[10]
Australia entered into an agreement with the US on 28
April 2014 to assist in the facilitation of FATCA for Australian financial
institutions.[11]
Legislation to give effect to Australia’s obligations under this agreement, the
Tax Laws Amendment
(Implementation of the FATCA Agreement) Act 2014, was supported by the
opposition and passed by the Parliament in mid‑2014.[12]
The first automatic sharing of account information under
FATCA with the US tax authority, the Internal Revenue Service (IRS), was
undertaken by the Australian Taxation Office (ATO) in September 2015.[13]
This involved the sharing of the details of over 30,000 accounts worth
over $5 billion with the IRS.[14]
The CRS imposes broader obligations on financial
institutions than FATCA in several respects:
- it
applies to all foreign resident taxpayer accounts, not just US resident
taxpayers under FATCA
- there
is no minimum account balance under the CRS, whereas there is a minimum balance
of $US50,000 under FATCA and
- the
range of financial institutions required to report is wider under the CRS than
under FATCA.[15]
International legal framework
underpinning the CRS and countries covered
The international legal basis for the implementation of the
CRS is the multilateral Convention on Mutual Administrative Assistance in
Tax Matters. This Convention, to which Australia became a signatory on
3 November 2011 with entry into force for Australia from 1 December 2012,
provides for all forms of administrative co-operation, contains strict rules on
confidentiality and proper use of information, and permits automatic exchange
of information.[16]
A tax authority is only able to automatically exchange
information with a tax authority in another country under the Convention if an
administrative agreement is in place. A standard agreement under the
Convention, the Multilateral
Competent Authority Agreement (MCAA), includes provisions for
confidentiality and data safeguards.[17]
The Explanatory Memorandum notes that ‘to date, over 95
countries have committed to [the CRS] implementation’.[18]
On 29 October 2014, 51 jurisdictions signed the MCAA.[19]
Australia signed the MCAA on 3 June 2015.[20]
The OECD notes that, as at 27 January 2016, the total number of
signatories was 79.[21]
Countries that had signed by this time included Bermuda, Ireland, New Zealand,
Switzerland and the United Kingdom.[22]
Key terms, information to be
reported and processes required to be undertaken
The CRS includes a range of definitions and concepts that will
determine which institutions will need to comply, and the nature of the
accounts and account holders that need to be considered in reporting
information to the relevant tax authority.
Financial institutions
The CRS identifies a ‘Reporting Financial Institution’ as
the type of entity that will be required to collect and report information on
foreign resident account holders. There are a number of tests to determine what
entities meet this definition, including whether it is an entity for CRS
purposes (step 1), whether it is in a participating jurisdiction (step 2),
whether it is a financial institution (step 3) and whether it is excluded as a
specific non-reporting financial institution (step 4).[23]
In broad terms, the CRS outlines the financial institutions that need to report
as banks, credit unions, brokers and life insurers with exclusions including
government entities, central banks and ‘other low-risk financial institutions’.[24]
The regulation impact statement included in the Explanatory
Memorandum notes that the implementation of the CRS in Australia is expected to
affect over 184 financial institutions, comprising around 101 small,
50 medium and 33 large financial institutions.[25]
These institutions include 70 banks, nine building societies,
85 credit unions and some insurers and fund managers.[26]
Accounts
Under the CRS, Reporting Financial Institutions are required
to review accounts they maintain to identify whether any of them need to be
reported to the tax authority. The accounts to be reported—defined as
‘Reportable Accounts’—are required to be identified by the Reporting Financial
Institution using a two-step process:
- firstly,
to identify financial accounts that need to be reviewed, such as depositary
accounts, equity and debt interests and certain insurance contracts, with
specific exclusions (‘Non-Reportable Accounts’) such as retirement and pension
accounts, term life insurance contracts and ‘other low-risk excluded accounts’
and
- secondly,
to identify a ‘Reportable Account’, which itself involves two separate tests to
identify whether the account holder is a resident of a jurisdiction that is a
party to the CRS (defined as a ‘Reportable Jurisdiction Person’) or whether the
account is held by a ‘passive’ entity, or by a person that exercises control of
the entity.[27]
The CRS will apply different procedures for accounts that
pre-exist the implementation of CRS by each jurisdiction and new accounts. In
general, the reporting of pre-existing accounts uses a specific date selected
by the participating jurisdiction and relies on information already held by the
financial institution to determine whether the account is reportable or not,
whilst determining the reporting of new accounts will rely mainly on new
information required to be provided by an individual when a new account is
established. Monetary thresholds for reporting are also established for some
types of accounts.[28]
Information to be reported
The information that is to be reported to the tax authority includes
information such as:
- name
- address
- jurisdiction
of residence
- tax
identification number (TIN) for the jurisdiction of residence
- account
details such as name of financial institution and identifying account number
and
- financial
information such as the balance of value of the account and gross amount of
interest paid or credited to the account.[29]
Due diligence procedures
The due diligence procedures required to be undertaken by
reporting financial institutions can be different for individuals and entity
accounts, pre-existing and new accounts and according to the value or balance
of the account.
As an example, Figure 2 shows the due diligence process
for pre-existing individual accounts requires different processes to be
undertaken, leading to different outcomes for reporting, depending on the value
of the account at the implementation date chosen by the jurisdiction.
Figure 2: Due diligence procedure for pre-existing individual accounts
Source: OECD, Standard
for automatic exchange of financial information in tax matters: Implementation
handbook, op. cit., p. 51.
Planned implementation in Australia
and other selected jurisdictions
Australia’s commitment when it signed the MCAA on
23 June 2015 was for the implementation of CRS from 1 January
2017 with the first exchange of information to take place in 2018.[30]
The implementation timetable as provided for in the Bill is generally
for application from 1 July 2017. On this basis, all accounts opened by
financial institutions after 1 July 2017 are treated as new accounts and those
maintained on 30 June 2017 are treated as pre-existing accounts.[31]
With this application date, and the treatment of the period 1 January 2017 to
30 June 2017 and 1 July 2017 to 31 December 2017 as separate financial years,
financial institutions will be required to report information to the ATO on
accounts held over the period July 2017 to December 2017 by 31 July 2018.[32]
As such, the ATO will likely be in a position to exchange information with
other jurisdictions towards the end of 2018.
Figure 3: Expected Common
Reporting Standard implementation timeline in Australia
Source: ATO, ‘Common
Reporting Standard (CRS)’, ATO website, accessed 10 February 2016.
A summary by the Australian Taxation Office of the implementation timetable as
at 2 February 2016 provides an overview of the implementation arrangements
(Figure 3).
A summary of implementation commitments by jurisdictions is
available on the OECD website.[33]
Countries that have committed to the exchange of information in 2017 include
the United Kingdom, Ireland and the Cayman Islands.[34]
Countries that have committed to the first exchange of information in 2018
include Canada, the Cook Islands and Switzerland.[35]
New Zealand
The New Zealand Government announced its commitment to
implementing CRS on 29 October 2014, beginning with the exchange of information
on a voluntary basis from 2018 and aiming for mandatory reporting in 2019.[36]
In making the announcement, the Minister of Revenue noted that:
New Zealand intends to align its timetable with Australia’s
and begin exchanging information on a voluntary basis from 2018, aiming for
mandatory reporting in 2019. This will give New Zealand’s financial industry
enough time to comply with the initiative.[37]
To date, no legislation has been introduced in the New
Zealand Parliament to support implementation of the CRS. The OECD jurisdiction
summary noted above nominates New Zealand as having committed to the first
exchange in 2018.[38]
Canada
In its 2015 Budget, the Canadian Government proposed to
implement the CRS from 1 July 2017, allowing for a first exchange of information
in 2018.[39]
United Kingdom
The United Kingdom implemented the CRS through the International
Tax Compliance Regulations 2015, which came into force on 15 April 2015.[40]
Pre-existing accounts are those in existence as at 31 December 2015, with self-certification
for new accounts required from 1 January 2016.[41]
The first reporting period ends on 31 December 2016, with information to
be reported to the UK tax authority on or before 31 May 2017.[42]
Information is to be exchanged by the UK tax authority with partner
jurisdictions on or before 30 September 2017.[43]
Policy development
The development of the policy to adopt the CRS was informed
by a consultation process by the Treasury which included a consultation paper
in mid-2014 and draft legislation in September 2015.
Consultation paper
On 19 June 2014, Treasury published a consultation paper on
the CRS.[44]
The Government sought specific feedback as part of this process on:
- timing
- financial
institutions’ potential implementation and compliance costs and
- suggestions
on how to minimise the implementation and compliance costs.[45]
The Treasury received 15 submissions on the paper,
including five confidential submissions.[46]
Issues covered in these submissions included:
- implementation
timeframes[47]
- the
desirability of aligning CRS arrangements with those required by FATCA[48]
and
- estimates
of implementation and compliance costs.[49]
Draft legislation
Draft legislation to support the implementation of the CRS
was published by the Treasury on 18 September 2015, with submissions closing
on 9 October 2015.[50]
At the time of writing, Treasury had not yet published submissions on its
website.
Some differences between the draft legislation and the Bill
include:
- the
addition of penalty provisions for a financial institution which fails to obtain
self-certification by individuals who open new accounts about the jurisdiction
of residence for tax purposes
- the
inclusion of anti-avoidance provisions giving the Commissioner of Taxation the
ability to treat an account as a reportable account and
- a
staggered implementation for due diligence processes and reporting for some
types of accounts rather than a blanket commencement from 1 January 2017.
Senate Standing Committee for the
Selection of Bills
The Senate Standing Committee for the Selection of Bills
recommended that the Bill not be referred to a committee for inquiry.[51]
Senate Standing Committee for the
Scrutiny of Bills
The Senate Standing Committee for the Scrutiny of Bills drew
attention to the Bill’s engagement with the right to privacy as it involves the
sharing of personal information with other jurisdictions if a relevant
information-sharing agreement is in place.[52]
However, the Committee left the question of whether the proposed approach is
appropriate to the Senate as a whole.[53]
During debate on the Bill in the House of Representatives,
the Australian Labor Party (ALP) indicated that it would support the Bill, but moved
an amendment to bring forward the deadline for reporting company accounts from
2019 to 2018.[54]
The ALP also indicated that it would examine possible amendments to increase
the transparency of the data provided under the CRS, such as having the ATO publish
aggregated, de‑identified information about how many accounts and what
value holdings foreign nationals have in Australia.[55]
As at the date of writing, no other non-government parties
or independents had taken a published position on the Bill.
The Australian Banking Association (ABA) broadly supports the
measures to increase transparency of income and tax flows through the CRS.[56]
The ABA’s main concern has been to reduce, as much as possible, duplication and
compliance costs involved.[57]
The Financial Services Council (FSC) also broadly supports
implementation of the CRS but has raised concerns about compliance costs and
processes.[58]
The Explanatory Memorandum notes that the financial impact
of implementing the CRS is ‘a small but unquantifiable revenue gain’.[59]
The regulation impact statement included in the Explanatory Memorandum provides
some additional information, noting that:
The implementation of the CRS in Australia is estimated to
deliver a small but unquantifiable revenue gain ($0 to $10 million per annum)
over the forward estimates period, with larger unquantifiable gains ($10 to
$100 million per annum) beyond this, as more jurisdictions implement the CRS.
The revenue gain is unquantifiable due to lack of reliable
data. As more countries implement the CRS and the ATO undertakes more
compliance activity, it is expected that the revenue gain will increase over
time.
Although the revenue gain is unquantifiable, it is important
to note that the automatic reporting of foreign financial accounts of
Australian residents to the ATO will act as a strong deterrent against the
concealment of foreign source income by such residents. This will drive
substantial improvements in voluntary compliance and increase community
confidence and willingness to participate in the tax system.[60]
As required under Part 3 of the Human Rights
(Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the
Bill’s compatibility with the human rights and freedoms recognised or declared
in the international instruments listed in section 3 of that Act. The
Government considers that the Bill is compatible.[61]
The Parliamentary Joint Committee on Human Rights did not
raise any human rights concerns associated with the Bill.[62]
Compliance costs to be borne by
account holders and customers of financial institutions
As noted in the Explanatory Memorandum, the CRS is estimated
to affect over 184 financial institutions.[63]
The compliance costs for financial institutions relate to professional legal
services, business systems design and development and the development of staff
training and education.[64]
The compliance costs for implementation of the CRS from 1 July 2017, as proposed
in the Bill, consist of $55.4 million in minimum upfront implementation
costs and ongoing compliance costs of $12.7 million per year.[65]
It is expected that the burden of meeting compliance costs
will fall to the customers of financial institutions. The Explanatory
Memorandum notes:
Financial institutions have advised that their compliance
costs to implement the CRS are expected to be borne by Australian consumers of
financial services in the form of higher fees and charges and/or higher
interest rates, rather than being borne by the owners of the financial
institutions. This is a result of financial institutions’ cost of capital being
set in international capital markets, especially for foreign owners, and if the
compliance costs were borne by these owners it would lower their return,
possibly leading to disinvestment.[66]
Application of the CRS to
Australian financial institutions
Item 13 inserts the substantive amendments to the Taxation
Administration Act 1953 that relate to the implementation of the Common Reporting
Standard.[67]
New Subdivision 396-C essentially requires certain financial
institutions to give information to the Commissioner of Taxation based on the
definitions, processes and requirements of the CRS. The subdivision defines the
CRS in new section 396-110 (‘Meaning of CRS’) to be ‘the Common
Reporting Standard set out in Part II.B of the Standard for Automatic Exchange
of Financial Account Information in Tax Matters approved by the Council of the
Organisation for Economic Co-Operation and Development on 15 July 2014’.
Some elements in new Subdivision 396-C where
domestic law is being used to tailor provisions to Australia, include:
- the
exclusion of entities such as government entities, central banks and
retirements funds, or an entity the relevant Minister prescribes by legislative
instrument, from reporting under the CRS (proposed subsection 396-115(1)).
- the
exclusion of certain accounts such as retirement and pension accounts, certain
other tax-favoured accounts, or an account the relevant Minister prescribes by
legislative instrument, from being considered as a reportable account (proposed
subsection 396-115(3))., and
- an
entity may choose to treat all dollar amounts specified in the CRS as being in
Australian dollars (proposed subsection 396-120(8)).
Implementation timetable
As noted previously, Australia’s commitment when it signed
the MCAA on 23 June 2015 was for the implementation of CRS from
1 January 2017 with the first exchange of information to take place in
2018.[68]
The date specified for a pre-existing account is specified
to be 30 July 2017 (proposed subsection 396-120(6)).
Item 14 of Schedule 1 sets out the implementation
dates for reporting by financial institutions and other entities, with
reference to the CRS.
The requirements under the CRS are generally implemented
with respect to calendar years (January to December) and the implementation
timetable establishes the period 1 July 2017 to 31 December as a separate
calendar year. The key dates for reporting arrangements are:
- determination
of whether a pre-existing individual is a high value account (an aggregate
balance or value that exceeds $US1 million)— 30 June 2017 (proposed table
item 1 at item 14)
- determination
of whether a pre-existing individual account is a lower value account (an
aggregate balance or value that does not exceed $US1 million)— 30 June
2017 (proposed table item 1 at item 14)
- deadline
for completing reviews of pre-existing individual accounts that are lower value
accounts— 31 July 2019 (proposed table item 2 at item 14)
- deadline
for completing reviews of pre-existing individual accounts that are high value
accounts— 31 July 2018 (proposed table item 2 at item 14)
- determination
of whether a pre-existing entity account has an aggregate account balance or
value of $US250,000 or less, or exceeds $US250,000— 30 June 2017 (proposed
table item 3 at item 14) and
- deadline
for completing reviews of pre-existing entity accounts with a balance exceeding
$US250,000— 31 July 2019 (proposed table item 6 at item 14).
This staged timetable will allow for the sharing of
information towards the end of 2018, consistent with the Government’s
commitment. However, some information (pre-existing individual accounts with a
value of less than $US1 million and pre-existing entity accounts valued at
more than $250,000), will potentially not be shared with other jurisdictions
until later in 2019.
While the Regulation Impact Statement included in the
Explanatory Memorandum canvases different commencement dates, none of the
options presented included differentiated starting dates for different types of
accounts. The draft legislation, released in September 2015, included
provisions for reporting financial institutions to defer their reporting
obligations by 12 months to ‘minimise the regulatory burden for Australian
financial institutions’.[69]
However, this option was not included in the final Bill. The draft legislation
did however contemplate a later reporting date for pre-existing low value
accounts (which In the draft legislation related to accounts open as at
31 December 2016), of 31 July 2019.[70]
Members, Senators and Parliamentary staff can obtain
further information from the Parliamentary Library on (02) 6277 2500.
[1]. Treasury,
Common
Reporting Standard for the automatic exchange of tax information,
discussion paper, Treasury, Canberra, June 2014, p. 1, accessed
3 February 2016.
[2]. Ibid.
[3]. BEPS
is discussed below.
[4]. Group
of Twenty (G20), G20
Leaders’ Communique Brisbane summit, communique, 15–16 November 2014,
p. 2, accessed 4 February 2016.
[5]. OECD,
‘Standard
for automatic exchange of financial information in tax matters’, OECD website,
accessed 4 February 2016.
[6]. OECD,
Standard
for automatic exchange of financial account information in tax matters,
OECD Publishing, Paris, 21 July 2014, accessed 4 February 2016.
[7]. OECD,
Action plan on base
erosion and profit shifting (Action Plan), OECD Publishing,
Paris, 2013, accessed 7 November 2015.
[8]. Group
of Twenty (G20), G20
Leaders’ Communique Brisbane Summit, op. cit.
[9]. J
Hockey (Treasurer) and C Jordan (Commissioner of Taxation), Joint
press conference: multinational tax avoidance [etc.], press release,
16 September 2015, accessed 7 November 2015; J Hockey, ‘Second
reading speech: Tax Laws Amendment (Combating Multinational Tax Avoidance) Bill
2015’, House of Representatives, Debates, 16 September 2015, pp.
10323, accessed 7 November 2015.
[10]. B
Pulle and H Gobbett, The
US Foreign Accounts Tax Compliance Act (FATCA) and interaction with G20
initiatives: a quick guide, Research paper series, Parliamentary
Library, Canberra, 10 January 2014, accessed 4 February 2016.
[11]. Australian
Taxation Office (ATO), ‘Foreign
Account Tax Compliance Act’, ATO website, accessed 4 February 2016.
[12]. Parliament
of Australia, ‘Tax
Laws Amendment (Implementation of the FATCA Agreement) Bill 2014 homepage’,
Australian Parliament website, accessed 4 February 2016.
[13]. ATO,
A
major step in global transparency, media release, 23 September
2015, accessed 5 February 2016.
[14]. Ibid.
[15]. Treasury,
Common
Reporting Standard for the automatic exchange of tax information, op.
cit., pp. 3 and 6; KPMG, ‘Common
Reporting Standard: proceed with caution’, KPMG website, accessed
11 February 2016.
[16]. Convention
on Mutual Administrative Assistance in Tax Matters, done at Strasbourg
on 25 January 1988 [2012] ATS 38 (entered into force for Australia 1 December
2012). OECD, Standard
for automatic exchange of financial account information in tax matters,
op. cit., p. 13. OECD, Jurisdictions
participating in the Convention on Mutual Administrative Assistance in Tax
Matters: Status 20 January 2016’, OECD website, accessed 4 February
2016.
[17]. OECD,
‘The
CRS Multilateral Competent Authority Agreement’, OECD website, accessed 4
February 2016.
[18]. Explanatory
Memorandum, Tax Laws Amendment (Implementation of the Common Reporting
Standard) Bill 2015, p. 7.
[19]. OECD,
‘The
CRS Multilateral Competent Authority Agreement’, op. cit.
[20]. Ibid.
[21]. Ibid.
[22]. OECD,
‘Signatories
of the Multilateral Competent Authority Agreement on automatic exchange of
financial account information and intended first information exchange date:
status as of 27 January 2016’, OECD website, accessed 4 February 2016.
[23]. OECD,
Standard
for automatic exchange of financial information in tax matters: Implementation
handbook, op. cit., p. 35.
[24]. Ibid.,
p. 39.
[25]. Explanatory
Memorandum, op. cit., p. 63.
[26]. Ibid.
[27]. OECD,
Standard for automatic exchange of financial information in tax matters:
Implementation handbook, op. cit., pp. 42–46.
[28]. Ibid.,
pp. 49–69.
[29]. Ibid.,
pp. 71–75.
[30]. J
Hockey (Treasurer) and S Ciobo (Parliamentary Secretary to the Minister for
Foreign Affairs and Parliamentary Secretary to the Minister for Trade and
Investment), Australia
signs up to combat tax evasion, joint media release, 3 June 2015,
accessed 10 February 2016.
[31]. Explanatory
Memorandum, op. cit., p. 13.
[32]. Item
14 of the Bill includes the commencement dates of 1 July 2017 for most
aspects of the CRS in Australia. Item 13 of the Bill includes proposed
subsection 396-105(6) which requires statements that contain information
under the CRS to be given to the Commissioner of Taxation no later than the
first 31 July after the end of the financial year.
[33]. OECD,
‘CRS
by jurisdiction’, OECD website, accessed 10 February 2016.
[34]. Ibid.
[35]. Ibid.
[36]. T
McClay (Minister of Revenue), NZ
to join global crackdown on tax evasion, media release, 29 October
2014, accessed 10 February 2016.
[37]. Ibid.
[38]. OECD,
‘CRS
by jurisdiction’, OECD website, accessed 10 February 2016.
[39]. Government
of Canada, ‘2015
Budget: Annex 5.1 – Tax measures: Supplementary information’, Government of
Canada website, accessed 5 February 2016.
[40]. HM
Revenue & Customs (UK), Automatic
exchange of financial account information: guidance notes, HMRC, 14
September 2015, p. 11, accessed 5 February 2016.
[41]. Ibid.,
p. 14.
[42]. Ibid.
[43]. Ibid.
[44]. Treasury,
‘Common
Reporting Standard for the automatic exchange of tax information’, Treasury
website, accessed 3 February 2016.
[45]. Ibid.
[46]. Ibid.
[47]. ANZ,
Submission
to Treasury, Common Reporting Standard for the automatic exchange of taxpayer
information: discussion paper, 16 July 2014, p. 2; Financial Services
Council (FSC), Submission
to Treasury, Common Reporting Standard for the automatic exchange of taxpayer
information: discussion paper, July 2014, p. 2, both accessed
16 February 2016.
[48]. ANZ,
op. cit., p. 2; Property Council of Australia, Submission
to Treasury, Common Reporting Standard for the automatic exchange of taxpayer
information: discussion paper, 18 July 2014, p. 3, accessed
16 February 2016.
[49]. FSC,
Submission, op. cit., p. 15; Customer Owned Banking Association, Submission
to Treasury, Common Reporting Standard for the automatic exchange of taxpayer
information: discussion paper, 17 July 2014, p. 5, accessed
16 February 2016.
[50]. Treasury,
‘Draft
legislation to implement in Australia the OECD’s Common Reporting Standard for
the automatic exchange of financial account information’, Treasury website,
accessed 4 February 2016.
[51]. Senate
Standing Committee for the Selection of Bills, Report,
1, 2016, 4 February 2016, accessed 4 February 2016.
[52]. Senate
Standing Committee for the Scrutiny of Bills, Alert
digest, 1, 2016, 3 February 2016, p. 44, accessed 4 February 2016.
[53]. Ibid.
[54]. A
Leigh, ‘Second
reading speech: Tax Laws Amendment (Implementation of the Common Reporting
Standard) Bill 2015’, House of Representatives, Debates, 8 February
2016, p. 65; A Leigh, Proposed
amendments to the Tax Laws Amendment (Implementation of the Common Reporting
Standard) Bill 2015, House of Representatives, 8 February 2016, both
accessed 9 February 2016.
[55]. Ibid.
[56]. Australian
Bankers Association Inc., ABA’s
response to the Tax discussion paper, 1 June 2015, p. 12,
accessed 11 February 2016.
[57]. Ibid.
[58]. FSC,
Submission, op. cit.
[59]. Explanatory
Memorandum, op. cit., p. 3.
[60]. Ibid.,
p. 38.
[61]. The
Statement of Compatibility with Human Rights can be found at pages 25–30 of the
Explanatory Memorandum to the Bill.
[62]. Parliamentary
Joint Committee on Human Rights, Thirty-third
report of the 44th Parliament, 2 February 2016, pp. 1–2, accessed
4 February 2016.
[63]. Explanatory
Memorandum, op. cit., p. 63.
[64]. Ibid.
[65]. Ibid.,
p. 62.
[66]. Ibid.,
p. 64.
[67]. Taxation Administration
Act 1953, accessed 19 February 2016.
[68]. J
Hockey (Treasurer) and S Ciobo (Parliamentary Secretary to the Minister for
Foreign Affairs and Parliamentary Secretary to the Minister for Trade and
Investment), Australia
signs up to combat tax evasion, joint media release, 3 June 2015,
accessed 10 February 2016.
[69]. Explanatory
Memorandum, Draft legislation to implement in Australia the OECD’s Common
Reporting Standard for the automatic exchange of financial account information,
p. 15, accessed 22 February 2016.
[70]. Ibid.
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