Minister for Revenue and Assistant Treasurer
26 November 2001 - 17 July 2004
11 May 2004
UNIFORM CAPITAL ALLOWANCES— DEDUCTIONS FOR THE COST OF ACQUIRING CERTAIN TELECOMMUNICATIONS RIGHTS
The Government will allow capital allowance tax deductions for indefeasible rights to use (IRUs) domestic telecommunications cables and telecommunications site access rights, the Minister for Revenue and Assistant Treasurer, Senator Helen Coonan, announced today.
“The change removes the inconsistent taxation treatment of domestic and international IRUs, and better matches the taxation treatment of both domestic IRUs and telecommunications site access rights to their underlying economic characteristics,” Senator Coonan said.
Currently, such expenditure can only be claimed for taxation purposes as a capital loss upon expiry of the right or, in the case of domestic IRUs, at the end of the life of the underlying cable. Conversely, expenditure on acquiring an IRU over an international telecommunications cable is able to be depreciated over the life of the underlying cable.
“The measure will encourage sharing of infrastructure within the telecommunications industry and will reduce inefficient duplication of telecommunications infrastructure,” Senator Coonan said.
The measure will apply to expenditure incurred from 12May2004.