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Govt takes next step on CIVs
The Federal Government has taken the step beyond its broad-brush Budget endorsement of an investment management regime (IMR) by asking the Board of Taxation to consider the underlying design.
The move was confirmed this week by the minister for Financial Services, Chris Bowen, and the Assistant Treasurer, Senator Nick Sherry, who said the Board of Taxation had been asked to review the Australian and foreign income aspects of an IMR as part of a broader review of collective investment vehicles (CIVs).
The two ministers said an IMR would provide a set of clear and comprehensive rules on the taxation of certain non-resident investments into Australian and offshore assets.
It was intended that the IMR would extend beyond funds management to cover a range of other activities in the financial sector.
Commenting on the move, Bowen said the establishment of an IMR would help grow the Australian financial services sector, creating employment opportunities.
He said the reform was expected to encourage offshore investors, fund managers and other financial institutions to invest and manage offshore capital.
The terms of reference handed to the Board of Taxation include reporting on the tax treatment of CIVs having regard to the managed investment trust tax framework and whether a broader range of tax flow-through CIVs such as corporate CIVs should be permitted.
AUTHOR
Mike Taylor
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