The Hatter's Watch: Tax Benefit in Part IVA
Australian Tax Review, Vol. 43, No. 3, pp. 150-161, 2014
22 Pages Posted: 6 Sep 2014 Last revised: 30 Mar 2015
Date Written: September 4, 2014
Abstract
The 2013 amendments to Part IVA directed to the concept of tax benefit are the first major change to the rule since its enactment in 1981. This article applies orthodox principles of statutory interpretation to examine the meaning of the amendments and the changes they make to previous tax benefit jurisprudence. Analysis of the text reveals an absence of clarity at several key points including the ‘based on a postulate’ concept, the ‘reasonable alternative’ concept, and the direction to disregard tax effects. Possible interpretations are identified. The ambiguity of the statute means that a large task of law-making is left to the judiciary.
Keywords: Tax avoidance, General anti-avoidance rules, Statutory interpretation, Tax benefit
JEL Classification: K10, K30, K34
Suggested Citation: Suggested Citation