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Minerals Resource Rent Tax Repeal and Other Measures Bill 2013

Schedule 5 Geothermal energy


Income Tax Assessment Act 1997

1  Section 12-5 (table item headed “capital allowances”)


exploration or prospecting .................................................

40-80(1) and (1A), 40-730

geothermal exploration information ................................

Subdivision 40-B

geothermal exploration rights ............................................

Subdivision 40-B


exploration or prospecting .................................................

40-80(1), 40-730

2  Section 15-40

Before “Your”, insert “(1)”.

3  Section 15-40

Omit “or * geothermal exploration information”.

4  At the end of section 15-40


             (2)  Your assessable income includes an amount you receive for providing * geothermal exploration information you have to another entity if:

                     (a)  you continue to have the information; and

                     (b)  the information is, and continues to be, relevant to:

                              (i)  * geothermal energy extraction that you carry on or propose to carry on; or

                             (ii)  a * business that you carry on that includes * exploration or prospecting for * geothermal energy resources from which energy can be extracted by geothermal energy extraction; and

                     (c)  the amount you receive is not assessable as * ordinary income under section 6-5.

It does not matter whether the information is generally available or not.

             (3)  Geothermal exploration information is geological, geophysical or technical information that:

                     (a)  relates to the presence, absence or extent of * geothermal energy resources in an area; or

                     (b)  is likely to help in determining the presence, absence or extent of such resources in an area.

             (4)  Geothermal energy extraction means operations that are for:

                     (a)  the extraction of energy from * geothermal energy resources; and

                     (b)  the * purpose of producing assessable income.

5  Paragraphs 40-30(2)(ba) and (bb)

Repeal the paragraphs.

6  Section 40-40 (table item 9A)

Repeal the item.

7  Subsection 40-80(1A)

Repeal the subsection.

8  Subsection 40-290(5)

Repeal the subsection, substitute:

Exception: mining, quarrying or prospecting information

             (5)  This section does not apply to * mining, quarrying or prospecting information.

9  Subsection 40-300(2) (table item 12)

Repeal the item.

10  Paragraph 40-630(1)(b)

Omit “or * geothermal energy extraction”.

11  Subsection 40-630(1) (note)

Omit “or geothermal energy extraction”.

12  Paragraphs 40-630(1A)(b), (1B)(b) and (3)(b)

Omit “or * geothermal energy extraction”.

13  Paragraph 40-650(3)(a)

Omit “or * geothermal energy extraction”.

14  Paragraph 40-650(3)(b)

Omit “or that extraction”.

15  Subsection 40-730(1) (heading)

Repeal the heading.

16  Subsections 40-730(2A) and (2B)

Repeal the subsections.

17  Subsection 40-730(3)

Repeal the subsection, substitute:

             (3)  Also, you cannot deduct expenditure under subsection (1) to the extent that it forms part of the * cost of a * depreciating asset.

18  Paragraph 40-730(4)(b)

Omit “and for * geothermal energy resources”.

19  Paragraph 40-730(4)(c)

Omit “, or of extracting energy from geothermal energy resources,”.

20  Paragraph 40-730(4)(d)

Omit “materials; and”, substitute “materials.”.

21  Paragraph 40-730(4)(e)

Repeal the paragraph.

22  Subsections 40-730(7A), (7B) and (9)

Repeal the subsections.

23  Subparagraph 43-70(2)(fa)(iv)

Omit “or (1A)”.

24  Section 112-38

Repeal the section.

25  After paragraph 124-710(1)(a)


                    (aa)  an authority, licence, permit or entitlement under an Australian law to prospect or explore for * geothermal energy resources in an area; or

26  Paragraph 124-710(1)(b)

After “minerals”, insert “or geothermal energy resources”.

27  Paragraph 124-710(1)(c)

After “(a)”, insert “, (aa)”.

28  After paragraph 124-710(2)(a)


                    (aa)  an authority, licence, permit or entitlement under an Australian law to extract energy from * geothermal energy resources in an area; or

29  Paragraph 124-710(2)(b)

After “minerals”, insert “, or extract energy from geothermal energy resources,”.

30  Paragraph 124-710(2)(c)

After “(a)”, insert “, (aa)”.

31  Paragraph 165-55(2)(ba)

Repeal the paragraph.

32  Paragraphs 716-300(1)(b) and (c)

Omit “or (1A)”.

33  Subsection 716-300(1) (note)

Omit “Subsections 40-80(1) and (1A), which are in that Subdivision, provide”, substitute “Subsection 40-80(1), which is in that Subdivision, provides”.

34  Subsection 995-1(1) (definition of geothermal energy extraction )

Omit “40-730(7B)”, substitute “15-40(4)”.

35  Subsection 995-1(1) (definition of geothermal energy extraction right )

Repeal the definition.

36  Subsection 995-1(1) (definition of geothermal energy resources )

Repeal the definition, substitute:

geothermal energy resources means matter occurring naturally within the Earth and containing energy as heat.

37  Subsection 995-1(1) (definition of geothermal exploration information )

Omit “40-730(9)”, substitute “15-40(3)”.

38  Subsection 995-1(1) (definition of geothermal exploration right )

Repeal the definition.

39  Application and saving provisions

(1)       The amendments of sections 40-30, 40-80 and 40-290 of the Income Tax Assessment Act 1997 by this Schedule do not affect deductions or balancing adjustments for geothermal exploration rights or geothermal exploration information that started to be held before 1 July 2014.

(2)       The amendments of sections 40-630 and 40-650 of the Income Tax Assessment Act 1997 , and the repeal of subsection 40-730(2A) of that Act, by this Schedule apply to expenditure incurred after 30 June 2014.

(3)       The amendments by this Schedule affecting sections 112-38 and 124-710 of the Income Tax Assessment Act 1997 apply in relation to authorities, licences, permits and entitlements held after 30 June 2014.