Andy Hutt highlights upcoming changes in the tax landscape in 2018.
Much is set to change in our tax landscape in 2018.
We are already two weeks into the “post H.R.1” world of US tax, with President Trump having signed the tax reform bill into law on 22 December 2017. The impacts of the reduction in the US corporate income tax rate, immediate expensing of business asset acquisitions, and the new base erosion measures are already starting to be felt.
In terms of the legislation Australia has passed, 2018 will also see the end of the first year of income for which the Australian Taxation Office (ATO) can assess additional tax under the diverted profits tax regime. 31 July 2018 will also see the first deadline under the common reporting standard legislation, which will require financial institutions to report on accounts held by foreign residents to the ATO. By 30 September 2018, we can expect that the ATO will have exchanged that data with overseas counterparts, in return for information about accounts held by Australian residents in those jurisdictions.
Legislation currently before Parliament includes a Bill to modify the corporate and taxation laws to enhance and expand protection for “eligible whistleblowers”. The Bill in its current form would impose significant penalties on employers and/or employees who breach the confidentiality of an eligible whistleblower, and therefore may require a significant investment in training for many businesses.
This year will also see ongoing consultation with Treasury on (and likely the subsequent enactment of) Exposure Draft Bills which address hybrid mismatches, and also the tax framework for the corporate collective investment vehicle regime.
We also await the Productivity Commission’s report on horizontal fiscal equalisation, the process by which the federal government’s revenues from the goods and services tax are allocated among the state and territory governments. There is the possibility for this to have significant flow-on consequences if it results in adjustments to the allocation model.
Finally, a federal election could take place any time from 4 August 2018 resulting in the possibility of much more change occurring!