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Thursday, 31 May 1973
Page: 2970


Mr CREAN (Melbourne Ports) (Treasurer) - I move the following amendment:

After sub-clause (3), insert the following sub-clause: (3a) In relation to assessments in respect of income of the year of income that commenced on 1st July,

1972-

(a)   sub-sections 80b (9) and 80da (1) of the Principal Act as amended by this Act have effect as if the references in those sub-sections to sub-section 80a (5) of that Act as so amended were references to sub-section 80a (2) of the Principal Act; and

(b)   section 80da of the Principal Act as amended by this Act has effect for the purposes of the application of that section in relation to a loss, or a part of a loss, incurred by a company as if a reference in that section to continuing shareholders in the company were -

(i)   in a case to which sub-paragraphs (ii) and (iii) do not apply - a reference to persons referred to in sub-section 80a (1) of the Principal Act;

(ii)   if section 80c of the Principal Act applies for the purpose of determining whether the loss, or the part of the loss, is to be taken into account for the purposes of section 80 or section 80aa of that Act - a reference to persons referred to in paragraph 80c (1) (b) of the Principal Act; or

(iii)   if section 80d of the Principal Act applies in relation to section 80a of that Act for the purpose of determining whether the loss, or the part of the loss, is to be so taken into account - a reference to persons referred to in sub-section 80a (1) of the Principal Act as affected by section 80d of that Act.'

It is proposed by the Bill that the requirements of the 'continuing ownership test' that applies in determining whether a company may be allowed a deduction for a prior year's loss be replaced by more stringent requirements in relation to the 1973-74 income year and subsequent years. It is proposed also to reinforce this test with safeguarding provisions to apply first for the 1972-73 year to ensure that it is not circumvented by devices designed to defeat its application. Through inadvertence, the proposed safeguarding provisions may not in all cases apply as intended in relation to the 1972-73 income year. In certain circumstances they may be inapplicable and in others they may apply to deny a deduction that ought to be allowable. The amendment is intended to change the transitional provisions of the Bill to remedy this defect, and will ensure that the safeguards apply as evenly in relation to the current year as in relation to future years. I commend the amendment to the Committee.







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