David Bradbury (Lindsay, Australian Labor Party, Assistant Treasurer ) Share this | Hansard source

I present a supplementary explanatory memorandum to the bill. I seek leave to move government amendments as circulated together.

Leave granted.

I move government amendments (1) and (2) on sheet AP242 and (1) and (2) on sheet CJ279:

(1) Schedule 5, item 2, page 36 (line 5), after "earliest year", insert "(disregarding any period when the entity was not in existence)".

(2) Schedule 5, item 2, page 36 (line 8), at the end of subsection 160-25(2), add "(disregarding any period when the entity was not in existence)".

(1) Clause 2, page 2 (table items 6 and 7), omit the table items.

(2) Schedule 4, page 24 (line 1) to page 30 (line 19), omit the Schedule.

As introduced, the bill requires that an entity be a corporate tax entity throughout the year spanned by the carry-back, including throughout the year to which the loss is carried back. This raises the possible interpretation that an entity cannot have been a corporate tax entity throughout the year during which it comes into being because it did not exist as an entity for the whole of that year. Under the amendments, any part of a year before the entity came into existence is to be disregarded in deciding if it was a corporate tax entity throughout the year. This will ensure that otherwise eligible entities are not precluded from carrying tax losses back to the year they came into existence and is consistent with the intention of the measure.

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