The Turnbull Government is continuing to deliver on its commitment to protect the integrity of Australia’s corporate tax system while providing increased certainty for businesses and investors. We are determined to ensure that taxpayers are paying the right amount of tax on their activities in Australia.
Over recent years, a growing number of taxpayers have sought to re-characterise trading income into more favourably taxed passive income. This practice reduces the Australian tax paid by investors and may distort investment decisions and lead to reduced economic efficiency. We are taking steps to eliminate this practice.
Treasury released a consultation paper seeking views from interested parties on potential policy options to address this.
Recognising the economic significance of stapled structures in the Australian economy and that this is a complex and sensitive issue, the Government will not be responding to the issue in the Budget. This will allow more time to formulate relevant options that minimise unintended consequences. In this regard, the timeline for the review will be extended to the end of July.
I have requested that my Department continue to work with stakeholders on the best approach to address this issue.
I would like to take this opportunity to thank stakeholders who have contributed to the consultation process so far.