Previously we reported here and here, legislation was introduced to the Parliament in October 2017 (then dropped) and again in February 2018 regarding proposed changes to the CGT main residence exemption as that exemption applies to foreign residents.
After significant delay and sustained lobbying as to the impact of the proposed changes on Australian expatriates seeking to dispose of Australian real property whilst they remained overseas, it now appears passage of legislation in relation to these measures is no longer supported by the Coalition government.
During remarks at the recent 2019 Tax Institute National Convention (as reported in the Australian Financial Review), Assistant Treasurer Stuart Robert MP, when questioned about the status of the proposed measures, indicated “sometimes things get announced and don’t get progressed and it’s just best to leave it that way”. At the very least, these comments appear to show support by the Coalition government of the proposed changes may be slipping and will not proceed.
Shadow Treasurer, Chris Bowen MP has also broken cover in light of Mr Robert’s comments reinforcing Labor’s lack of support for the measures and that if the Coalition government “isn’t serious about passing this legislation” it should be dropped altogether rather than remaining “[a] zombie measure” (noting Shadow Treasurer Bowen’s Media Release).
It remains to be seen what other tax measures and/or amendment to existing tax measures may be announced by the Coalition government ahead of the 2019/20 Federal Budget to be handed down on the 2 April 2019.
To discuss this further or for more information please contact:
Principal Lawyer | Accredited Specialist in Tax Law
M +61 407 821 157 | T +61 3 9611 0176
Level 5, 707 Collins Street, Melbourne, 3008, Victoria, Australia