The federal government is making some minor amendments in the Senate concerning the GST integrity measure dealing with the offshore supply of rights and options.
Schedule 3 of the
Tax Laws Amendment (2005 Measures No. 1) Bill 2005 aims to ensure, among other things, that domestic tour operators are not disadvantaged compared with some foreign operators when offering the same goods or services for consumption in Australia, such as holiday packages. These products will no longer be GST-free.
The government proposes to:
- apply the measure on and from October 1, 2005 to allow additional time for affected entities to prepare for the changes
- allow non-resident enterprises affected by the Bill that are unregistered to remain unregistered, or if currently registered to deregister for GST purposes. Enterprises that choose to be unregistered will effectively be input taxed. Non-resident enterprises that wish to deregister, may do so in the period July 1, 2005 to September 30, 2005.
Assistant Treasurer Mal Brough says the Bill will continue to achieve the tax integrity objectives of the government.
"The amendments will address several issues raised by industry representatives during consultations. Integrity measures are not subject to consultation prior to introduction," he says.
"The measure will prevent non resident enterprises from claiming full input-tax credits relating to supplies connected with Australia where they do no remit GST on the taxable supplies they make.
"Under the amendments, affected non-resident enterprises that choose to deregister will not be able to claim input-tax credits.
"The changes will allow currently registered non-resident tour operators sufficient time to deregister prior to the changes to the GST law applying and will reduce compliance costs for the affected non resident enterprises."