The Australian Treasury published 21 submissions received on the exposure draft legislation for a Diverted Profits Tax (DPT), which was launched by the Australian Government on November 29.
The DPT aims to ensure that the tax paid by significant global entities properly reflects the economic substance of their activities in Australia. It targets contrived arrangements resulting in tax evasion and allows collection of information for the timely resolution of tax disputes. The DPT will impose a penalty rate of tax and require that tax to be paid irrespective of whether the assessment is the subject of an unresolved dispute.
Treasury received 21 submissions in response to this consultation. Two submissions were not published by the Australian Treasury, as they were confidential. The ATO expects that multinationals will engage early on with the ATO and would continue to be monitored by the ATO in the event of a restructure undertaken to be compliant under the DPT.
On February 9, the Australian Government introduced a Proposal Diverted Profits Tax Bill 2017. This measure will apply in relation to tax benefits for the income year that starts on or after July 1, 2017.
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