The 2016-17 Federal Budget, delivered on 3 May, included a number of announcements affecting businesses operating across international jurisdictions, including a new Diverted Profits Tax and two new types of collective investment vehicles. Our team dissects those key issues and more, exploring their impact on businesses in Australia.
Tax announcements – continuation of major themes from 2015-16
Our national tax team has reviewed the announcements, which reflect a continuation of the major themes on taxation from last year. They note:
- The Federal Government continues to focus on small business as a way to grow the economy, and has proposed a number of additional measures including a cut in the tax rate for small business to 27.5%, and a change to what is considered a 'small business' when accessing certain small business tax concessions.
- The Federal Government also continues to focus on multinationals, with additional integrity measures announced, funding for a new ATO Tax Avoidance Taskforce, and consultation on the adoption of other measures proposed by the OECD as part of its Base Erosion and Profit Shifting.
Other announcements continue the Government's recent theme on encouraging innovative business, and there are proposals about future work to simplify particular complex areas of tax law, such as the taxation of financial arrangements regime.
These areas and more are explored in our report: Federal Budget 2016-17 – key tax announcements for business
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Financial services – collective investment funds
Our Financial Institutions team takes a closer look at the government's introduction of two new types of collective investment vehicles as a tax-effective alternative to the current Australian pooled investment trusts. They discuss how these reforms will enhance the international competitiveness of the Australian managed funds industry by allowing fund managers to offer investment products using vehicles that are commonly in use overseas.
More details are available in our alert, Federal Budget 2016-17 – New collective investment vehicles.
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