Rudd Government Introduces New Tax Bill

by Mary Swire, Tax-News.com, Hong Kong

24 March 2008

The government of Australian Prime Minister Kevin Rudd has introduced new legislation to improve Australia's taxation system and extend deductible gift recipient (DGR) status to a number of community organisations.

The Tax Laws Amendment (2008 Measures No. 2) Bill 2008 amends the tax law to account for amounts misappropriated by an employee or agent. This measure recognises the loss taxpayers suffer when they dispose of a depreciating asset or capital gains tax (CGT) asset, and an agent or an employee steals the proceeds.

It also ensures that the market value substitution rule does not apply where the CGT event occurs in relation to a share in a widely held company or a unit in a widely held unit trust, so that taxpayers are treated fairly by paying CGT on an amount they actually receive.

The Bill exempts from income tax the Endeavour Executive Award and research fellowships under the Endeavour Awards. The measure aims to ensure consistency in taxation treatment of research fellowships.

It also establishes the means for State and Territory governments to seek to exempt from income tax the first AUD1,000 of early completion bonuses paid to eligible apprentices.

The Bill updates the list of deductible gift recipients (DGRs) to include nine new entities, and to extend the time period of DGR status of four entities.

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