The Hatter's Watch: Tax Benefit in Part IVA

Australian Tax Review, Vol. 43, No. 3, pp. 150-161, 2014

Sydney Law School Research Paper No. 14/84

22 Pages Posted: 6 Sep 2014 Last revised: 30 Mar 2015

See all articles by Mark Brabazon

Mark Brabazon

The University of Sydney - Faculty of Law; University of Melbourne - Law School

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

Brabazon, Mark, The Hatter's Watch: Tax Benefit in Part IVA (September 4, 2014). Australian Tax Review, Vol. 43, No. 3, pp. 150-161, 2014, Sydney Law School Research Paper No. 14/84, Available at SSRN: https://ssrn.com/abstract=2491955

Mark Brabazon (Contact Author)

The University of Sydney - Faculty of Law ( email )

New Law Building, F10
The University of Sydney
Sydney, NSW 2006
Australia

University of Melbourne - Law School ( email )

University Square
185 Pelham Street, Carlton
Victoria, Victoria 3010
Australia

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