INCOME TAX AMENDMENT REGULATION 2012 (NO. 2) (SLI NO 115 OF 2012) EXPLANATORY STATEMENT

Section 266 of the Income Tax Assessment Act 1936 (the Act) provides that the Governor-General may make regulations prescribing matters required or permitted by the Act to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to the Act.

The amending Regulation updates the Income Tax Regulations 1936 (the Principal Regulations) in respect of tax arrangements for overseas defence service.

Schedule 1 to the amending Regulation includes duty with the multinational force established under the United Nations Security Council Resolutions 1970 and 1973 to enforce a no-fly-zone in relation to Libya as 'eligible duty' for the purposes of section 23AD.

Schedule 1 to the amending Regulation also extends the end date of the tax exemptions for Operation Slipper (to 30 June 2013), Operation Palate II and Operation Riverbank (both to 31 December 2013)

Section 2 provides that the Regulation commence on the day after it is registered.

Section 3 provides that Schedule 1 amends the Income Tax Regulations 1936 (the Principal Regulations).

Item 1 omitted '30 June 2012' in paragraph 7A(a) of the Principal Regulations and inserted '30 June 2013'.

Operation Slipper was previously approved until 30 June 2012 however the Operation had been extended until 30 June 2013. Operation Slipper is the ADF contribution to the international campaign against terrorism and maritime security in the Middle East Area of Operations and countering piracy in the Gulf of Aden.

The regulation extended the period over which service as part of Operation Slipper is 'eligible duty' for the purposes of section 23AD until 30 June 2013.

Item 2 omitted '31 December 2012' in paragraph 7A(b) of the Principal Regulations and inserted '31 December 2013'.

Operation Palate II was previously approved until 31 December 2012 however the Operation has been extended until 31 December 2013. Operation Palate II is the ADF contribution to the United Nations Assistance Mission to Afghanistan.

The regulation extended the period over which service as part of Operation Palate II is 'eligible duty' for the purposes of section 23AD until 31 December 2013.

Item 3 omitted '31 December 2012' in paragraph 7A(e) of the Principal Regulations and inserted '31 December 2013'.

Operation Riverbank was previously approved until 31 December 2012 however the Operation has been extended until 31 December 2013. Operation Riverbank is the ADF contribution to the United Nations Assistance Mission for Iraq.

The regulation extended the period over which service as part of Operation Riverbank is 'eligible duty' for the purposes of section 23AD until 31 December 2013.

Item 4 includes duty with the multinational force established under the United Nations Security Council Resolution 1970 and 1973 to enforce a no-fly-zone in relation to Libya as 'eligible duty' for the purposes of section 23AD.

The regulation covers the period starting on 31 March 2011 and ending on 31 October 2011.

No consultation was undertaken with regards to the Regulation as the changes are minor and of machinery nature.

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Income Tax Amendment Regulation 2012 (No. 2)

This Legislative Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

Overview of the Legislative Instrument

The purpose of the Legislative Instrument is to amend the Income Tax Regulations 1936 in respect of tax arrangements for overseas defence services.

Human rights implications

This Legislative Instrument does not engage any of the applicable rights or freedoms.

Conclusion

This Legislative Instrument is compatible with human rights as it does not raise any human rights issues.

DAVID BRADBURY

Assistant Treasurer

Commonwealth Numbered Regulations - Explanatory Statements

EXPLANATORY STATEMENT

Select Legislative Instrument 2012 No. 115

Issued by authority of the Assistant Treasurer