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Coalition Members’ Dissenting Report

Recommendation: That the Bill not be passed.

Liberal Members of the House Standing Committee on Economics were not afforded the opportunity to have a public hearing into this legislation. This was a Committee decision that Coalition committee members disagreed with.

15 submissions were received by the inquiry into this legislation, with many critical of the content of this Bill. Most notably absent from these was that of Treasury.

However, we note that today (12 March 2013), an undated electronic submission had been uploaded from Treasury and has subsequently been published on the Committee’s website, apparently in response to enquiries from the Committee.

Coalition members of the Committee view this to be highly unsatisfactory.

Coalition Members of the Committee find it difficult to support the passage of this Bill without having been afforded the opportunity to question the assumptions underlying the Government’s policy intent and to address many of the issues raised from submissions to the Committee. These issues include but are not limited to:

Schedule 1 Part IVA:

Modernisation of Transfer Pricing:

Australia’s transfer pricing legislation has rarely been amended, and largely stood the test of time.

Given the Government’s moves to block hearings by the House Standing Committee on Economics into this Bill, we are concerned that the design and drafting of the schedule may have been rushed and requires further testing (ie consultation and scrutiny) before it is passed to ensure that it is both robust and workable, and will stand the test of time. This is a position held by many submissions including from the Corporate Tax Association (CTA), PricewaterhouseCoopers (PwC), KPMG and The Tax Institute of Australia (TIA).

For example, on page 7 of its submission to the House Standing Committee on Economics’s inquiry into the Bill, the TIA said that:

“… we are concerned that the Bill as currently drafted will not yield many of the lauded simplicity and certainty benefits and will increase the compliance burden especially and disproportionately on small to medium enterprises.”

The schedule could benefit from further consultation and scrutiny in the following key areas:

 

Mr Steven Ciobo MP
Deputy Chair

 

Ms Kelly O’Dwyer MP                                                                         Mr Scott Buchholz MP

 

 

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