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Thursday, 21 June 2012
Page: 7418

Mr BRADBURY (Lindsay—Assistant Treasurer and Minister Assisting for Deregulation) (09:19): I move:

That this bill be now read a second time.

This bill makes consequential amendments to the Tax Administration Act 1953 to give effect to changes to the managed investment trust final withholding rate.

The Income Tax (Managed Investment Trust Withholding Tax) Amendment Bill 2012 (currently before the House of Representatives) amends the Income Tax (Managed Investment Trust Withholding Tax) Act 2008 to increase the managed investment trust final withholding tax rate to 15 per cent to fund payments. The changes will apply to income years commencing on or after 1 July 2012.

Fund payments made by a managed investment trust to non-resident investors, subject to certain conditions, are currently subject to the managed investment trust withholding tax of 7.5 per cent.

The 15 per cent withholding tax for managed investment trusts is still competitive with rates applying in other countries.

It is consistent with the government's original commitment prior to the 2007 election.

And it is significantly lower than the 30 per cent non-final withholding tax that applied under the previous government.

Increasing the managed investment trust final withholding tax from 7.5 per cent to 15 per cent better balances the need for Australia to be an attractive destination for foreign investment with ensuring Australia receives a fair return on profits to be made in Australia.

I commend the bill to the House.

Debate adjourned.