The Government on Fri 16.3.2012, released an exposure draft of proposed amendments that would implement the first stage of reforms to transfer pricing. They are on the Treasury website and were announced by the then Assistant Treasurer on 1 November 2011.

The Assistant Treasurer said the draft legislation takes into account a number of key issues raised by stakeholders through earlier consultation processes. He said the proposed amendments confirm that, in relation to treaty cases, the transfer pricing articles contained in Australia’s tax treaties are able to be applied and operate independently of Australia’s unilateral transfer pricing rules.

The operation of the proposed Subdivision would be limited to cases where its application would result in a greater amount of taxable income in Australia, a decrease in the tax loss of the entity or a decrease in a net capital loss of the entity relative to what has been returned.

DATE OF EFFECT: These proposed amendments would apply to income years commencing on or after 1 July 2004, “being the income year commencing after the Parliament last demonstrated its intention that the law should operate in this way”, Mr Bradbury said.

SUBMISSIONS are due by 13 April 2012.

[LTN 52, 16/3]