Australia: Legislation on interest limitation rules and foreign investment fees; bill on taxation of general insurers
Legislation considered by Parliament
March 28, 2024
Parliament passed the following bills, which now await Royal Assent:
- The Treasury Laws Amendment (Making Multinationals Pay Their Fair Share—Integrity and Transparency) Bill 2023 introduces new interest limitation (thin capitalisation) rules, requiring Australian public companies to disclose information about their subsidiaries in their annual financial reports and limiting the amount of debt deductions that multinational entities can claim in an income year.
- The Treasury Laws Amendment (Foreign Investment) Bill 2024 and the Foreign Acquisitions and Takeovers Fees Imposition Amendment Bill 2024 clarify the interaction between foreign investment fees and similar state and territory property taxes, and income tax treaties. They also increase the fees for acquiring established residential dwellings and double vacancy fees in the foreign investment framework.
The Senate also passed the following legislation that will now be sent back to return to the House of Representatives, after a number of amendments were made:
- The Treasury Laws Amendment (Support for Small Business and Charities and Other Measures) Bill 2023 would reduce the income tax compliance burden on the general insurance industry caused by the misalignment between the income tax law and the adoption of the new AASB 17. The bill proposes to:
- Increase the instant asset write-off threshold
- Provide small and medium businesses with access to a bonus deduction
- Facilitate certain community charities achieving deductible gift recipients (DGR) status
- Amend the income tax law with respect to general insurance
- Limit the amount of non-arm’s length income
- Reinstate Australian Financial Complaints Authority’s jurisdiction to hear complaints relating to superannuation