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FINANCE AND PUBLIC ADMINISTRATION--STANDING COMMITTEE--REFERENCES

Senator O'Chee, at the request of Senator Watson and pursuant to notice

of motion not objected to as a formal motion, moved--

(1) That the following matter be referred to the Standing Committee on

Finance and Public Administration for inquiry and report:

Taxation of Financial Arrangements: Consultative document issued

by the Treasurer (December 1993).

(2) That during the inquiry consideration be given to the following

matters:

(a) the adequacy of the existing law under the Income Tax

Assessment Act 1936 to bring to assessment on an appropriate

basis income and gains arising from financial arrangements

and, in particular, the synchronisation of treatment between

taxpayers;

(b) the adequacy of the existing law under the Income Tax

Assessment Act 1936 to deal with the deductibility of costs

and expenses associated with the entering into financial

arrangements and, in particular, the synchronisation of

treatment between taxpayers;

(c) the impact on business of the proposed initiatives contained

in the Consultative document and, in particular:

(i) the taxing of certain financial arrangements on an

unrealised basis, including foreign exchange gains and

losses,

(ii) the introduction of a compound accruals method of

calculating income from financial arrangements, and

(iii) the direct and indirect costs involved; and

(d) whether the proposed initiatives are compatible with tax

simplification.

(3) That the terms of reference of the inquiry be advertised in the

press in the usual way.

(4) That written submissions be sought and examined by the committee

and oral evidence be heard in public, including oral evidence from

the authors of the more important submissions.

Question put and passed.

Senator Colston, at the request of the Chairman of the Standing

Committee on Finance and Public Administration (Senator Coates) and

pursuant to notice of motion not objected to as a formal motion,

moved--That the following matter be referred to the Standing Committee

on Finance and Public Administration for inquiry and report:

Taxation, regulation and international competitiveness, with

particular reference to:

(a) encouraging Australian investment and the location of corporate

headquarters in Australia; and

(b) whether changes to the taxation system are feasible or

desirable, including consideration of the effects on revenue and

equity.

Question put and passed.