Australian federal budget released with a wave of reforms
International Tax Review is part of the Delinian Group, Delinian Limited, 4 Bouverie Street, London, EC4Y 8AX, Registered in England & Wales, Company number 00954730
Copyright © Delinian Limited and its affiliated companies 2024

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement
Local Insights

Australian federal budget released with a wave of reforms

Sponsored by


Jock McCormack of DLA Piper Australia analyses the latest Australian federal budget, with a host of important international tax reforms to be considered.

The Australian government delivered its 2023/24 Federal Budget on Tuesday 9 May 2023, demonstrating and reaffirming its strong commitment to critically important international and related tax reforms.

The key initiatives from the Budget include:

  • Implementing the OECD/G20-led Pillar II solution, incorporating the 15% global minimum tax for large multinational enterprises for income years commencing on or after January 1 2024;

  • Expanding Australia’s general anti-avoidance rules (Part IVA) to apply, firstly, to arrangements designed to access lower withholding tax rates on income paid to foreign residents (for example, under double tax treaties) and, secondly, potentially where there is a dominant purpose to reduce foreign income tax;

  • Reducing the managed investment trust withholding tax rate from 30% to 15% for eligible new build-to-rent projects;

  • Extending the clean building managed investment trust withholding tax concession (10%) to eligible data centres and warehouses;

  • Limiting the proportion of petroleum resource rent tax (PRRT) ‘assessable income’ that can be offset by deductions to 90% (of the assessable receipts), effectively introducing a ‘cap’ on deductions. Separately, the government will ‘modernise’ the PRRT from July 1 2024, following the Treasury review of the PRRT, including gas transfer pricing;

  • Tightening (or clarifying) the concept of ‘exploration for petroleum’ in the practical application of PRRT; and

  • Deferring the start date for the tax integrity measure previously announced for franked distributions funded by capital raisings from December 19 2016 to September 15 2022.

The government also continues to progress other international tax developments dealing with thin capitalisation, restricting deductibility of payments for intangibles in low tax jurisdictions and international tax transparency/disclosure. It is expected that these international tax developments will progress through parliament in the coming weeks.

more across site & bottom lb ros

More from across our site

The full list of finalists has been revealed and the winners will be presented on June 20 at the Metropolitan Club in New York
The ‘big four’ firm has threatened to legally pursue those behind the letter, which has been circulating on social media
The guidelines have been established in the wake of multiple tax scandals and controversies that have rocked the accounting profession
KPMG Netherlands’ former head of assurance also received a permanent bar and $150,000 fine; in other news, asset management firm BlackRock lost a $13.5bn UK tax appeal
The new, fully integrated office will also offer M&A, dispute resolution, IP and corporate tax services
The new guidance concerns a recent 1% excise tax on the repurchases of corporate stock for both US and certain foreign companies
Interpath has hired a managing partner from rival accounting firm BDO to lead the new operation
Survey results of over 28,000 in-house lawyers reveal that American in-house counsel place a higher value on the reputation of external advisers than their peers elsewhere
In an exclusive interview with ITR, Andrew Leigh also endorsed new legislation designed to prevent multinationals using complex corporate structures to reduce taxes
Nick Crama and Parwesh Bissumbhar, senior director and manager respectively at Alvarez & Marsal, outline practical advice for real estate managers to comply with DAC6 regulations
Gift this article