On 6 November 2013, the Government announced its intention to proceed with the 2013-14 Budget proposal to improve tax compliance through third party reporting and data-matching. The proposal is designed to improve taxpayer compliance by enhancing the information reported to the ATO by a range of third parties through the introduction of new reporting regimes. It is also proposed that this additional information would allow the ATO to offer an enhanced pre-filling service to taxpayers. The proposal is currently scheduled to commence from 1 July 2014 (although first reports would not be due to the ATO until after 1 July 2015).
On 7 February 2014, Treasury released a discussion paper on the proposal. It notes that some of the elements of the proposal can be implemented by the ATO changing its administrative practices whereas others would require tax law changes. The paper only relates to those elements requiring legislative change. This would involve the creation of new third party reporting regimes in relation to:
- sales of real property;
- sales of shares and units in unit trusts;
- sales through merchant debit and credit services; and
- taxable government grants and other payments.
The paper sets out a preliminary set of law design principles that could form the legislative basis for the new reporting regimes. However, it notes that the final form of any draft legislation would depend on the final form of the policy design and this, in turn, will be informed by the outcomes of the consultation process. Accordingly, the Government says it is seeking feedback on policy issues and, in particular, the compliance cost impacts of the proposed reporting regimes.
COMMENTS are due by 11 March 2014.
[LTN 26, 10/2/14]