Foundations of Taxation Law

Australia’s income tax legislation has always contained some form of general anti-avoidance rule. Australia’s general anti-avoidance provisions are located in pt IVA ITAA36. Part IVA replaced the former general anti-avoidance provision contained in s 260 ITAA36, which applied to arrangements that were made or entered into up to 27 May 1981. Part IVA applies to ‘schemes’ entered into after that date. Part IVA is a complex statutory regime that consists of a number of interconnected provisions. The provisions have been amended on several occasions over the years and currently comprise ss 177A to 177R. This chapter discusses the background to the introduction of pt IVA and focuses on the operation of its core provisions. It is important to be aware that significant amendments to pt IVA were introduced by Tax Laws Amendment (Countering Tax Avoidance and Multinational Profit Shifting) Act 2013 (Cth). These amendments were designed to address certain weaknesses in the provisions that had been identified in various cases. They apply to schemes other than those that were entered into, or commenced to be carried out, before 16 November 2012.