Commonwealth Numbered Regulations - Explanatory Statements

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Select Legislative Instrument 2005 No. 195


Issued by authority of the Minister for Revenue
and Assistant Treasurer

Income Tax Assessment Act 1936

Income Tax Amendment Regulations 2005 (No. 6)

Section 266 of the Income Tax Assessment Act 1936 (the Act) provides, in part, that the Governor-General may make regulations not inconsistent with the Act, prescribing all matters which by the Act are required or permitted to be prescribed, or which are necessary or convenient to be prescribed for giving effect to the Act.

The purpose of the amending Regulations is to make a minor technical correction to Income Tax Amendment Regulations 2005 (No. 4).  A bracket was omitted from a formula, in relation to the senior Australians tax offset, that was contained in these Regulations.

The amending Regulations will ensure mathematical accuracy, by inserting a bracket in the formula for the rebate threshold for single senior Australians, before the first appearance of the letter ‘A’.  This results in the following formula:


The rebate threshold is the level of taxable income beyond which the senior Australians tax offset begins to phase out.  The formula above ensures that the rebate threshold is set at the ‘effective tax free threshold’ for senior Australians; that is, the point where their entitlement to the senior Australians tax offset and the low income tax offset will exactly offset the income tax that would otherwise be payable.

Using this formula, the rebate threshold for the 2005‑06 income year for single senior Australians is $21,968.

The amending Regulations commence on the commencement of the Tax Laws Amendment (Personal Income Tax Reduction) Act 2005.  The Bill for this Act was introduced into Parliament on 12 May 2005, is expected to pass in the next sitting of the Senate (currently due in August 2005) and will commence on 1 July 2005.  The amending Regulations apply to the 2005-06 year of income and later years of income. 

Subsection 12(2) of the Legislative Instruments Act 2003 prohibits the retrospective operation of regulations, or a provision of regulations, which adversely affect the rights of, or impose liabilities on, a person other than the Commonwealth in respect of anything done or omitted to be done before the date of notification.  The Office of Legislative Drafting and Publishing has advised that the Regulations do not contravene subsection 12(2) of the Legislative Instruments Act 2003.

The Regulations are a legislative instrument for the purposes of the Legislative Instruments Act 2003.

Consultation was not undertaken in relation to this instrument because it is minor or machinery of government in nature and does not substantially change the law.


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