Taxation (Neutralising Base Erosion and Profit Shifting) Bill – Committee Stage – Part 1 – Video 17

Taxation (Neutralising Base Erosion and Profit Shifting) Bill – Committee Stage – Part 1 – Video 17


do not just below the pivot ready my call the Honourable microwave it’s a risk for a former Minister of Revenue to be speaking on a bill like this particularly one where he wasn’t the wasn’t on the sleek committee but I’m gonna give it a go nevertheless and try not to sound like the grumpy uncle at the family reunion but I do want to acknowledge the minister and the chair and his efforts to address the technical questions that the house has put to him because I think it has a credit to him and to the process of the committee of the whole that we don’t always see in this house which is a preface for a real it occasionally he gave and I do so because I think it is fundamental to the powers that we are trying to give and the curbs on the powers that we’re trying to give him and revenue in respect of the 7 year limitation on the transfer pricing arrangements now there was a very good exchange I think between the Honorable Amy Adams and the Honorable Stuart Nash and respect at that point and I want to come back because I believe there is a risk that we in and not carefully wording the intention that the Select Committee and the government have in respect of this clause I think it’s Clause 36 for I know some very good tax accountants and lawyers in the market and we now have on record the government’s intent but I don’t believe that we have it in the woods that we’ll end up in the act if the bill is passed as it is now and essentially we can break down clause 36 for that this way there is a time bar there is an exception to it an amendment can be made for up to seven years if in the first four years and these are the key words the Commissioner notifies the taxpayer that this subsection applies now that’s right but here is the point what we risk if this amendment is not approved is that every single decision Inland Revenue make to extend the time-bar will be will have challenge brought to it probably into the courts by very very good lawyers and accountants who are working for large companies that will want to reduce the time-bar to the shortest period possible now may well be that there is a legitimate investigation underway but the law doesn’t require that to be the case except we now have the Select Committee report and the hand side of this debate where the minister himself as well as the shadow Minister of Finance have accepted that the intention of this was for an investigation to have started and if the law doesn’t say that then my concern is that the decision will be challenged in the court and set aside and the taxpayers will be the worst for the fact that if the transfer pricing arrangements were found to be unlawful or incorrect and law then that cannot be properly challenged and it’s no surprise that the IRD would like to take a longer time I think that’s understandable these arrangements can be notoriously complex and if they’re not subject to advance pricing arrangements as the law allows and they are not well known to Inland Revenue then it is possible that they don’t come to the to the department’s attention until quite late in that four year period but the expectation that the committee had was that an investigation should have commenced now I was fascinated at the minister’s comment that the term investigation is not defined and I’m not a lawyer but I would have thought that they did that in policing in Commission’s of inquiry in tax law investigation has in the miniature isn’t understood term that is more than just kicking the tires on a tax return that something has to have happened and I go back to what I believe is a very well worded handwritten sop by the Honorable Amy Adams and I would implore the minister to rethink whether or not for the avoidance of any doubt he has given us his assurance that he thinks the words in cost 36 4 is okay but and I don’t want to challenge that but for the avoidance of death there is no harm in can in considering this SOP mr. chip the Honorable Stuart Mitch mr. chair after listening to the Honorable Amy Adams I was not convinced in any way shape or form

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