Withholding Tax Rate Bill Wins Senate Support
Joint media release with
Mark Dreyfus MP
Parliamentary Secretary for Climate Change and Energy Efficiency
The Gillard Government today secured Parliamentary support for changes to the withholding tax rate for managed investment trusts proposed in the Budget.
The Income Tax (Managed Investment Trust Withholding Tax) Amendment Bill 2012 is expected to pass through the Senate later today.
"This Bill ensures that Australians can collect a fair return on investments in Australia, while remaining an attractive destination for international investment," said Assistant Treasurer David Bradbury.
"These measures will mean that Australia's withholding tax rate is equal to or better than most comparable nations. This move is consistent with the Henry Review's recommendations on location specific rents.
"This Bill is expected to pass the Senate even without the support of the Coalition.
"They are hiding behind deeply flawed analysis commissioned by vested interests to try to distract from their abysmal record on attracting investment to Australia.
"When the Coalition was last in office, the withholding tax rate was 30 per cent – double the rate proposed in the Budget."
The Government has also agreed to introduce subsequent legislation to support investment in the construction of new energy efficient buildings.
From 1 July 2012, managed investment trusts that only hold newly constructed energy efficient commercial buildings will be eligible for a 10% withholding tax rate.
The concession will be available in relation to office buildings that have obtained a 5-star Green Star rating or a predicted 5.5 star NABERS rating, and retail centres and non-residential accommodation that meet equivalent standards.
The new regime would apply where construction of the building commences after 1 July 2012.
"Energy efficiency is one of the simplest ways for households and businesses of all sizes to save money through smarter energy use and reduce dangerous greenhouse gas pollution," said Parliamentary Secretary for Climate Change and Energy Efficiency Mark Dreyfus.
The Department of Climate Change and Energy Efficiency will administer the eligibility requirements, and monitor investment outcomes.
The Government will seek to introduce and pass the relevant legislation in the Spring sittings of the Parliament. There will be industry consultation about the design of the scheme in coming weeks.
The eligibility criteria will be reviewed after 3 years to ensure they are selecting projects that are above the average level of energy efficiency.
The Government welcomes the constructive approach taken by the Australian Greens in passing this important legislation.
27 June 2012