A comparative analysis of the impact of tax on savings for retirement

Many countries, including Australia, recognise the need to have a well developed retirement savings policy to ensure that retirees have sufficient savings to live comfortably in retirement. Australia’s retirement saving system consists of threei different components: The Age Pension funded from current Government revenue; Compulsory saving, by means of occupational superannuation; and Voluntary saving and investment, partly supported by tax concessions. The Australian retirement savings system is currently coming under pressure as a result of a number of factors. Australia’s population is getting older and this is expected to significantly increase the costs to government of providing age pensions, aged care and health care in the future. Occupational superannuation due to its compulsory nature has increased the level of employee savings. However, there are many who still have little or no savings in superannuation, particularly part-time and low income employees. The projected contribution level of nine percent (9%) by the 2002/03 year is unlikely to provide sufficient savings to enable retirees to enjoy a standard of living in retirement commensurate with their expectations. This paper compares the Singapore, United Kingdom, Irish and Australian retirement savings systems with particular emphasis on the impact of tax on saving for retirement through the use of superannuation/pension funds. The objective of the paper is to determine whether the Australian retirement savings system contains sufficient tax incentives to encourage Australians to save for retirement

LakeEnsemblR: an R package that facilitates ensemble modelling of lakes

Model ensembles have several benefits compared to single-model applications but are not frequently used within the lake modelling community. Setting up and running multiple lake models can be challenging and time consuming, despite the many similarities between the existing models (forcing data, hypsograph, etc.). Here we present an R package, LakeEnsemblR, that facilitates running ensembles of five different vertical one-dimensional hydrodynamic lake models (FLake, GLM, GOTM, Simstrat, MyLake). The package requires input in a standardised format and a single configuration file. LakeEnsemblR formats these files to the input required by each model, and provides functions to run and calibrate the models. The outputs of the different models are compiled into a single file, and several post-processing operations are supported. LakeEnsemblR's workflow standardisation can simplify model benchmarking and uncertainty quantification, and improve collaborations between scientists. We showcase the successful application of LakeEnsemblR for two different lakes

Tax Evasion, Tax Avoidance and Tax Planning in Australia: The participation in mass-marketed tax avoidance schemes in the Pilbara region of Western Australia in the 1990s

This paper will examine the development of mass-marketed tax avoidance schemes in Australia. It will consider changes in approach to tax avoidance from the ‘bottom of the harbour’ schemes of the 1960s and 1970s to the mass-marketed tax avoidance schemes of the 1990s. It will examine the changing structure of tax avoidance from individually crafted tax avoidance structures designed by accountants and lawyers used by high wealth individuals to mass produced structures targeted at highly paid, and therefore highly taxed, blue collar workers in Australia’s mining industry in the 1990s. In the latter half of the twentieth century ‘unacceptable’ tax planning went from highly expensive, individually ‘tailor made’ structures afforded and used only by the very wealthy, to inexpensive replicated structures marketed to skilled and unskilled tradespeople and labourers. By 1998 over 42 000 Australian taxpayers were engaged in tax avoidance schemes with the highest proportion focussed in the mining regions of Western Australia. In the remote and inhospitable mining community of Pannawonica, which has one of the highest paid workforces in Australia, the Australian Taxation Office identified that as many as one in five taxpayers were engaged in a mass-marketed tax avoidance scheme. The paper will identify the causes of these changes, including the advent of the computerised information technology which permitted ‘mass production’ of business structures designed to exploit business incentives in the Australian taxation system in the 1990s. It will also set these developments within the broader context of the tax compliance culture prevailing in Australia and overseas during this period

Tax avoidance: a trans-Tasman comparative study

Australia and New Zealand have developed specific and general tax anti-avoidance rules to ensure that taxpayers in each country operate within the spirit of the law and do not seek to gain an unintended tax benefit from arranging their affairs or entering into transactions in a particular manner. This article compares the operation of the general tax anti-avoidance rules in both countries. The article initially identifies the basic operation of the anti-avoidance rules in both countires and then goes on to contrast and compare the manner in which each country's rules seeks to combat tax avoidance. An evaluation of the effectiveness of the separate tax avoidance rules in combating tax avoidance is also undertaken

Part IVA and mass marketed schemes

Mass marketed tax schemes have been on the radar of the Australian Tax Office in recent years. Typically these schemes were sold by way fo prospectuses (and excluded offers) and have included financing, agriculture, entertainment and franchise schemes. The primary question addressed in this article is whether because of their characteristics mass marketed schemes are likely to come within the ambit of the general tax anti-avoidance rules

Taxation of primary producers

This chapter discusses special tax measures designed to assist primary producers. Measures such as the deferring of abnormal income to later years and special deductions available to primary producers in association with income averaging provisions are discussed in detail

Cessation of registration

For most business transactions it could be stated that the job is not complete until the paperwork is done. This is certainly true in relation to finalising any outstanding GST consequences when an entity ceases to be registered for GST. In GST Today, Issue 26, February 2001, [26.4] Bernard Kellerman discussed some of the consequences of ceasing to be registered for GST. This article takes this issue a little further by discussing the specific operation of Div 138 of the GST Act

Part IVA and tax reform

Determining the extent to which the Australian general anti-avoidance tax provisions in Part IVA of the Income Tax Assessment Act 1936(ITAA36) apply to particular transactions is a perennial piece of work-in-progress for our tax professionals, tax administrators and the courts. The introduction of new legislation as a result of the tax reforms emanating from the Ralph Review provides yet another forum to test the application of Part IVA. The personal services income (PSI) provisions (which are part of the tax reform measures) limit the availability of deductions against PSI where the person earning the income cannot satisfy the personal services business tests. A person or entity satisfying the relevant tests is no longer subject to PSI rules but still needs to consider the application of Part IVA to their particular situation. This paper initially clarifies the concept of PSI and the types of entities that will be either within or outside the operation of the PSI rules. The paper then critically evaluates the likely application of Part IVA to PSI that is not subject to the PSI rules. This evaluation is completed by analysing the existing law in relation to Part IVA as well as any ruling and public pronouncements made by the Commissioner relevant to this matter. The paper concludes that certain types of entities generating PSI that are outside the PSI rules may be captured by the application of Part IVA

Personal Services Income: where to from here?

In Australia, the regime for the taxation of Personal Services Income (PSI) has suffered from being complex, unclear and uncertain, leading to poor compliance with the rules. Personal services income is defined as a reward for, or the result of, one’s personal efforts. Prior to the introduction of the regime, the tax system was plagued with a major inequity: it was possible for individuals to reduce their tax liability by alienating their PSI to an associated company (or other legal entity) and by claiming inappropriate 'business' deductions. This article reviews the current interpretation of the PSI rules, evaluates the Board of Taxation and the Henry Review findings and suggests an approach that reduces the potential application of Part IVA

Compensation for natural disasters: The tax consequences

The financial impact of natural disasters (including floods and cyclones) on business taxpayers can be immense and, in some cases, sufficient to result in the business ceasing to operate. As a result of recent natural disasters, federal and state governments have made certain grants to affected businesses in the form of cash payments and reimbursements. This article reviews the potential application of goods and services tax on the receipt of such grants, in addition to the entitlement to input tax credits for related acquisitions. This article also reviews the income tax treatment of certain grants and the availability of tax deductions for expenditure related to the grant moneys received