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Monday, 25 May 1998
Page: 3043

Senator Watson asked the Assistant Treasurer, upon notice, on 1 December 1997:

With reference to a recent statement from the Australian Taxation Office that the office had appointed six officers to oversee tax issues in relation to people visiting Australia for the Olympic Games 2000:

(1) Can an outline be provided of: (a) the scope of their duties; (b) the purpose of their appointment; and (c) matters that visitors and employees coming to Australia for the purpose of the Olympics should be aware of in respect of income tax, superannuation guarantee charge, capital gains tax and fringe benefits tax.

(2) Is it a fact that, under international tax treaty provisions, people may be exempt from income tax, fringe benefits tax and capital gains tax, however, there would be no exemption from the superannuation guarantee charge.

Senator Kemp (Assistant Treasurer) —The answer to the honourable senator's question is as follows:

(1) (a) The duties of this team are not confined to issues related to the Olympics. The team was established to deal with taxation issues in respect of major sporting and entertainment events, including the Olympics. Their duties include:-

. providing the Australian Taxation Office (ATO) view in respect of technical and administrative matters;

. undertaking a review of current tax legislation relative to participants in major international sporting and entertainment events;

. facilitating the ATO's involvement in the Commonwealth's `whole of Government' approach in respect of the Olympic Games by participating in various Government forums related to the holding of this event.

(1) (b) The purpose of the team is to provide an ATO co-ordination point for advice in respect of persons who participate in major international sporting and entertainment events. Resident and non-resident individuals or organisations can obtain advice from this team in respect of taxation issues arising from their participation in the Sydney 2000 Olympic Games and other major international sporting and entertainment events.

(1) (c) Non resident persons visiting Australia for the purposes of the Olympics will be subject to Australian tax law in respect of any income that they derive during their visit. Generally speaking, non residents are subject to Australian tax in respect of income that is sourced in Australia, however, because of the operation of the Double Taxation Agreements, (DTA) many visiting non residents who derive income in Australia in relation the Olympics may be taxed in their country of residence rather than in Australia.

Australia has entered into 37 DTAs. These agreements can vary as to the taxes covered, their scope, and the particular articles included. The agreements contain articles that will affect persons visiting for the Olympics including, the taxation of dependant and independent personal services, visiting entertainers and sports people, capital gains, and other types of income.

Non residents visiting Australia in relation to the Olympics may be subject to Australian capital gains tax if they dispose of a "taxable Australian asset". The term "taxable Australian asset" includes a number of categories of assets that are defined in the Income Tax Assessment Act including, land or interests in land in Australia, interests in Australian private companies and resident trusts, portfolio interests in Australian public companies and public unit trusts, and assets used in Australian businesses.

Employees visiting Australia for the Olympics will not be personally liable for fringe benefits tax (FBT) and the superannuation guarantee charge (SGC) as these amounts are levied on the employer and not the employee.

FBT is payable by employers on the value of certain fringe benefits that are provided to employees or their associates in respect of their employment. The main types of fringe benefits are car benefits, expense payments, housing benefits, living away from home allowances, entertainment, and transport.

An employer will be generally required to provide superannuation guarantee support for non resident employees who perform work in Australia in relation to the Olympics, however employees who hold a Class 413 (Executive Overseas) visa or entry permit are classed as exempt employees for superannuation guarantee purposes. Employees who receive wages of less that $450 per month will also be exempt.

(2) Double tax agreements, as mentioned above, can vary as to the taxes covered. However, they may cover taxing rights regarding income, the provision of fringe benefits and capital gains. They do not, however, exempt employers from the superannuation guarantee charge in respect of salary or wages paid to visiting non-resident employees.