{"id":"C2017A00021","name":"Diverted Profits Tax Act 2017","slug":"diverted-profits-tax-act-2017","collection":"act","jurisdiction":"commonwealth","status":"in_force","isInForce":true,"actNumber":"21 of 2017","makingDate":null,"administeringDepartment":null,"currentVersion":{"id":8571,"registerId":"commonwealth-C2017A00021-current","compilationNumber":null,"startDate":"2026-03-30","status":"InForce","reasons":null,"registeredAt":null},"sections":[{"sectionNumber":"1","sectionType":"section","heading":"Diverted Profits Tax Act 2017","content":"---\nmeta-content-style-type: text/css\nmeta-content-type: application/xhtml+xml; charset=utf-8\n---\n\n?xml version=\"1.0\" encoding=\"utf-8\" standalone=\"no\"?>\n\n![](image.001.png)\n\n \n\n \n\n \n\n \n\n \n\n \n\nDiverted Profits Tax Act 2017\n\n \n\nNo. 21, 2017\n\n \n\n \n\n \n\n \n\n \n\nAn Act to impose diverted profits tax, and for related purposes\n\n \n\n \n\n \n\nContents\n\n1 Short title\n\n2 Commencement\n\n3 Imposition of tax\n\n4 Rate of tax\n\n \n\n![](image.001.png)\n\n \n\n \n\nDiverted Profits Tax Act 2017\n\nNo. 21, 2017\n\n \n\n \n\n \n\nAn Act to impose diverted profits tax, and for related purposes\n\n[Assented to 4 April 2017]\n\nThe Parliament of Australia enacts:\n\n1  Short title\n\n  This Act is the Diverted Profits Tax Act 2017.\n\n2  Commencement\n\n (1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.\n\n \n\n- Commencement information\n- Column 1 Column 2 Column 3\n- Provisions Commencement Date/Details\n- 1. The whole of this Act At the same time as item 13 of Schedule 1 to the Treasury Laws Amendment (Combating Multinational Tax Avoidance) Act 2017 commences.However, the provisions do not commence at all if that item does not commence. 1 July 2017\n\n\nNote: This table relates only to the provisions of this Act as originally enacted. It will not be amended to deal with any later amendments of this Act.\n\n (2) Any information in column 3 of the table is not part of this Act. Information may be inserted in this column, or information in it may be edited, in any published version of this Act.\n\n3  Imposition of tax\n\n  Tax payable in accordance with section 177P of the Income Tax Assessment Act 1936 is imposed.\n\n4  Rate of tax\n\n  The rate of tax imposed by this Act is 40%.\n\n \n\n \n\n \n\n \n\n[Minister’s second reading speech made in—\n\nHouse of Representatives on 9 February 2017\n\nSenate on 23 March 2017]\n\n(11/17)\n\n \n","sortOrder":0}],"analysis":{"kimi_summary":{"content_quality":"ok","complexity_score":2,"scope_assessment":{"changed":false,"description":"This Act has remained tightly scoped to its original purpose since enactment. It was always intended as a simple imposition mechanism, with substantive rules located elsewhere. No scope creep has occurred within this Act itself."},"complexity_factors":["Extremely short — only 4 operative sections","No defined terms (all definitions live in the companion Income Tax Assessment Act 1936)","No conditional logic or exceptions within this Act itself","Single cross-reference to external legislation (section 177P of ITAA 1936)","Mechanical structure: imposition + rate only"],"plain_english_summary":"**What this law does:**\n\nThis is a short, technical law that creates a new tax called the \"diverted profits tax\" (DPT). It doesn't contain the detailed rules about *when* this tax applies — those are in a different law, the *Income Tax Assessment Act 1936* (specifically section 177P). This Act simply:\n\n- **Imposes** the tax (makes it legally real)\n- **Sets the rate** at 40% — much higher than the standard company tax rate\n\n**Who it affects:**\n\nLarge multinational companies operating in Australia. The tax targets arrangements where companies artificially shift profits offshore to avoid Australian tax — for example, by charging themselves inflated prices for goods or services from related overseas companies.\n\n**Why it matters:**\n\nThe 40% rate is deliberately punitive. It's designed to scare multinationals into abandoning aggressive tax avoidance schemes rather than actually paying the tax. The message is: \"If you try to game the system, you'll pay far more than if you'd just paid normal tax.\"\n\nThis Act works as a \"bookend\" to the main rules — it can't be understood without reading the companion legislation in the *Income Tax Assessment Act 1936*."},"flash_summary":{"complexity_score":3,"scope_assessment":{"changed":false,"description":"Based on the text of the Act as enacted, the scope is narrowly to impose a diverted profits tax payable under section 177P of the Income Tax Assessment Act 1936 and to set the rate at 40% (s3, s4). Commencement is explicitly tied to the commencement of a specified item in another Act; the Act does not itself alter that linkage (s2). There is no text within this Act that expands or narrows that scope beyond those elements."},"complexity_factors":["Relies entirely on section 177P of the Income Tax Assessment Act 1936 for substantive definitions, calculation and application of the tax (s3).","Commencement is conditional on a specific item in a different Act commencing, creating an external dependency and implementation risk (s2 and commencement table).","The Act itself contains very few operative provisions (only imposition and rate), requiring cross-referencing to other legislation to understand effect (s3, s4).","Lack of in‑text definitions or procedural detail means practical effect depends on interpreting external provisions and coordination between statutes (s3)."],"plain_english_summary":"The Act creates a 40% \"diverted profits tax\" by imposing liability by reference to section 177P of the Income Tax Assessment Act 1936, without restating calculation or definitional rules. Its commencement is tied to item 13 of Schedule 1 in the Treasury Laws Amendment (Combating Multinational Tax Avoidance) Act 2017. It therefore raises tax exposure for entities caught by s177P and leaves substantive rules to that provision."}},"importantCases":[],"_links":{"self":"/api/acts/diverted-profits-tax-act-2017","history":"/api/acts/diverted-profits-tax-act-2017/history","analysis":"/api/acts/diverted-profits-tax-act-2017/analysis","conflicts":"/api/acts/diverted-profits-tax-act-2017/conflicts","importantCases":"/api/acts/diverted-profits-tax-act-2017/important-cases","documents":"/api/acts/diverted-profits-tax-act-2017/documents"}}