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Thursday, 28 February 2013
Page: 1297

Senator FIFIELD (VictoriaManager of Opposition Business in the Senate) (12:57): The coalition supports this bill, which amends the International Tax Agreements Act 1953 to bring into force, in Australian law, new taxation agreements with India, the Marshall Islands and Mauritius.

The Indian protocol was signed in New Delhi on 16 December 2011. This protocol will amend the agreement between the government of Australia and the government of the Republic of India for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income, which was signed in 1991. The Indian protocol seeks to improve the administrative framework for tax cooperation between Australia and India. It updates the rules for the taxation of business profits and services to bring them into line with international practice. It will also insert rules to protect taxpayers from tax discrimination.

Both the Marshall Islands and Mauritius agreements cover allocation of taxing rights and transfer pricing adjustments. The Marshall Islands agreement was signed in Majuro on 12 May 2010. There is no pre-existing agreement of this type between Australia and the Marshall Islands. The Mauritius agreement was signed in Port Louis on 8 December 2010. Both agreements include provisions dealing with a range of circumstances, including income from pensions and retirement annuities, which will generally be taxed only in the country of residence of the recipient, provided the income is subject to tax in that country; income from government service will generally be taxed only in the country that pays the remuneration; payments made from abroad to visiting students and business apprentices, for the purposes of their maintenance, education or training, will be exempt from tax in the country visited; and a non-binding administrative mechanism will be established to assist taxpayers to seek resolution of transfer pricing disputes.

These are non-controversial international agreements that seek to avoid double taxation, codify tax allocation and combat tax avoidance. As I have indicated, the coalition will be supporting the bill.