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ItemReducing tax complexity: quick reference cards for tax practitioners(LexisNexis, 2015-02)Overcoming complexity in the tax system is one of the major challenges for the profession as well as the community. This article looks at the development of quick reference guides (QRGs) that seek to improve simplicity by synthesising the volume of law and cases. This improves the application of tax law and thus reduces the operating costs for practitioners, government and the community.
ItemAllowable deductions, cost base of CGT assets and the GAAR: a minefield for taxpayers and their advisers(LexisNexis, 2014-10)Taxpayers and their advisers have, for decades, struggled to reconcile outgoings that can be considered as allowable deductions under s 8-1 of the Income Tax Assessment Act 1997 (Cth) (ITAA 97), with those outgoings which may be included in the cost base of a Capital Gains Tax (CGT) asset.1 In this article we briefly examine Hart’s case2 and the subsequent Taxation Determination TD 2005/33 issued by the Australian Tax Office (ATO). This Tax Determination sets out the Commissioner’s view regarding the inclusion (or non-inclusion) of non-capital costs of ownership of a CGT asset in its cost base where such outgoings had been previously denied deductibility under the general deduction provisions3 of the ITAA 97 by virtue of the general anti-avoidance rule (GAAR) under Pt IVA of the Income Tax Assessment Act 1936 (Cth) (ITAA 36).
ItemReducing the company tax rate and abolishing the MRRT: a step forward or back?(LexisNexis, 2014-12)The Australia’s Future Tax System Review,1 commonly referred to as the Henry Tax Review (the Review) has been “one of the most comprehensive reviews of the tax and transfer system” ever undertaken in Australia.2 The overall aim of the Review was to restructure the way in which the government collects taxes so as to place the nation in a position where it could effectively deal with “its social, economic and environmental challenges and enhance economic, social and environmental well-being”.3 As a product of the review, Recommendations 27 and 45 have gained political and economic attention, suggesting a reduction of the company tax rate coupled with improved arrangements for charging for the use of non-renewable resources via a “uniform resource rent tax”.4 The first part of this paper will evaluate the Review’s Recommendation 27 that “the company income tax rate should be reduced to 25%,”5 by first discussing the proposed reform, then examining what impact it may have on the current tax system and evaluating the purported benefits of implementing the Recommendation. The second part of this paper will consider the second limb of Recommendation 27, which sets out that “[i]mproved arrangements for charging for the use of non-renewable resources should be introduced at the same time”6 together with Recommendation 45 which advocates the introduction of a “uniform resource rent tax”. Particular focus will be given to the Australian experience in relation to its failed attempt to introduce the Mineral Resource Rent Tax (MRRT).
ItemAre changes to negative gearing in Australia imminent?(LexisNexis, 2015-12)Negative gearing on levered investments is one of Australia’s most prevalent tax shelters and has been the focal point of an ongoing and heated debate.1 While negative gearing is most commonly used in property,2 there is no limit on deductions from investments across a range of asset classes, such as bonds,3 managed funds, agriculture, real property or shares.4 This article will consider negative gearing concessions for investment in residential property, the arguments in favour of the abolition of negative gearing centered at the heart of the negative gearing debate, possible reform options and barriers to achieving reform.
ItemThe perils of tardy PPSR registration: Pozzebon (Trustee) v Australian Gaming and Entertainment Ltd(LexisNexis, 2014-11)The recent decision of Pozzebon (Trustee) v Australian Gaming and Entertainment Ltd1 serves as a cautionary tale to secured lenders. It illustrates how a failure to register a security interest on the Personal Property Securities Register (PPSR) within 20 business days of execution may have dire consequences, rendering the security worthless if the corporate security provider enters external administration.
ItemGoodridge appeal - legal principles governing assignment and novation of contracts(LexisNexis, 2011-03)The recent decision of the full bench of the Federal Court in Leveraged Equities Ltd v Goodridge1 has unanimously overturned the contentious first instance decision of Rares J2 and, in doing so, has restored clarity to the legal principles governing assignment and novation of contracts. Although the decision centred on the enforcement of margin lending arrangements and the proper construction of an ambiguously drafted contract, the case has wider implications for syndicated loans, securitisations and commercial transactions generally. The first instance decision caused much consternation in financial and legal circles, as it appeared to challenge existing legal principles and practice regarding the novation and assignment of contracts. Although several commentators suggested that the statements from the Goodridge decision should be confined to the specific facts, there was concern that if applied more broadly, the Goodridge decision undermined the validity of existing loan transfers, securitisations and other commercial transactions. The appeal decision has put such fears to rest, while providing a cogent and authoritative summation of the Australian law on novation and assignments, in line with both English and US authorities. Nevertheless, there are some aspects of the decision which may require further clarification.