Income Tax (Rates) Act 1976

INCOME TAX (RATES) ACT 1976

No. 57 of 1976

An Act to declare the Rates of Income Tax payable upon Incomes, other than Incomes of Companies and of Superannuation Funds.

BE IT ENACTED by the Queen, and the Senate and House of Representatives of the Commonwealth of Australia, as follows: –

Short title.

1. This Act may be cited as the Income Tax (Rates) Act 1976.

Commencement.

2. This Act shall come into operation on the day on which it receives the Royal Assent.

Interpretation.

3. (1) In this Act, unless the contrary intention appears—

“Assessment Act” means the Income Tax Assessment Act 1936-1976;

“superannuation fund” means a provident, benefit, superannuation or retirement fund;

“tax” means income tax imposed as such by any Act other than—

(a) income tax payable by a company (other than a company in the capacity of a trustee);

(b) income tax payable by a person in the capacity of a trustee of a superannuation fund; or

(c) income tax payable in accordance with section 128b of the Assessment Act.

(2) In this Act, a reference to net income or taxable income shall be read as a reference to net income or taxable income, as the case may be, of the year of income.

Incorporation.

4. The Assessment Act is incorporated, and shall be read as one, with this Act.

Rates of tax.

5. (1) Except as otherwise provided by this Act, the rates of tax are as set out in Schedule 1.

(2) The rates of tax in respect of a taxable income to which Division 16 of Part III of the Assessment Act applies are as set out in Schedule 2.

(3) The rate of tax in respect of a taxable income in any case where section 59ab, 86 or 158d of the Assessment Act applies is as set out in Schedule 3.

(4) The rate of tax payable by a trustee in pursuance of section 98 or 99 of the Assessment Act is as set out in Schedule 4.

(5) The rate of further tax payable by a person in pursuance of sub-section 94 (9) of the Assessment Act is such amount (if any) per dollar as is ascertained by dividing an amount equal to one-half of the taxable income of the person, less the amount of tax (if any) that, but for this sub-section and but for any rebate or credit to which the person is entitled (other than a rebate allowable by virtue of sub-section 159n (2), or an additional rebate allowable by virtue of paragraph 159n (3) (b), of the Assessment Act), would be payable by the person, by a number equal to the number of whole dollars in that taxable income.

(6) The rate of further tax payable by a trustee in pursuance of sub-section 94 (11) or (12) of the Assessment Act is such amount (if any) per dollar as is ascertained by dividing an amount equal to one-half of the net income of the trust estate in respect of which the trustee is liable to be assessed and to pay tax under section 98 or 99 of that Act, less the amount of tax (if any) that, but for this sub-section and but for any rebate or credit to which the trustee is entitled (other than a rebate allowable by virtue of sub-section 159n (2), or an additional rebate allowable by virtue of paragraph 159n(3)(b), of the Assessment Act), would be payable by the trustee in respect of that net income, by a number equal to the number of whole dollars in that net income.

(7) The rate of tax payable by a trustee in respect of the net income of the trust estate in respect of which the trustee is liable, in pursuance of section 99a of the Assessment Act, to be assessed and to pay tax is 50 per centum.

Limitation of tax payable on certain incomes.

6. (1) Where the taxable income of a person does not exceed $1,492, the amount of tax payable by him under sub-section 5(1), (2) or (3) shall not exceed 66 per centum of the amount by which the taxable income exceeds $1,040 less any rebate or credit to which he is entitled.

(2) Where the net income of a trust estate in respect of which a trustee is liable to be assessed and to pay tax under section 98 of the Assessment Act does not exceed $1,492, the amount of tax payable by the trustee under sub-section 5(4) in respect of that net income shall not exceed 66 per centum of the amount by which that net income exceeds $1,040 less any rebate or credit to which the trustee is entitled.

(3) Where the net income of a trust estate in respect of which a trustee is liable to be assessed and to pay tax under section 99 of the Assessment Act does not exceed $748, the amount of tax payable by the trustee under sub-section 5(4) in respect of that net income shall not exceed 45 per centum of the amount of which that income exceeds $416 less any rebate or credit to which the trustee is entitled.

Adjustment where amount to be paid by, or refunded to, taxpayer would not exceed 49 cents.

7. (1) This section applies for the purposes of the making of an assessment of tax (other than further tax payable in pursuance of sub-section 94(9), (11) or (12) of the Assessment Act) in respect of the income of a taxpayer of a year of income where, upon the making of the assessment and the serving of notice of the assessment upon the taxpayer, there would, but for this section, be a net amount of not more than 49 cents payable by the Commissioner to the taxpayer, or by the taxpayer to the Commissioner, under the law relating to income tax, after taking into account all liabilities of the taxpayer, and all rebates and credits allowable to the taxpayer, under that law.

(2) Where this section applies in relation to the making of an assessment–

(a) if the amount of not more than 49 cents would be an amount payable to the taxpayer–additional tax equal to that amount is imposed by this Act in respect of the income of the taxpayer of the year of income; and

(b) if the amount of not more than 49 cents would be an amount payable to the Commissioner–the amount that, but for this section, would be the amount of income tax imposed in respect of the income of the taxpayer of the year of income, before the allowance of any rebates to which the the taxpayer is entitled, is reduced by so much of that amount of not more than 49 cents as does not exceed the amount calculated by deducting the amount of any such rebates from the sum of the amount that is to be so reduced and any amount of further tax payable by the taxpayer in respect of that year of income in pursuance of sub-section 94(9), (11) or (12) of the Assessment Act.

(3) A reference in this section to a liability of the taxpayer shall be read as including a reference to a liability in respect of income tax or provisional tax notified to the taxpayer by the Commissioner, notwithstanding that the amount of the liability has not become due and payable.

(4) For the purposes of any calculation under the law relating to income tax that depends upon the amount of tax paid or payable by, or assessed in respect of the income of, a taxpayer, the tax assessed and payable under an assessment in relation to which this section applies shall be deemed to be the tax that would have been so assessed and payable if this section had not applied.

Act to be deemed to be the Act declaring rates of income tax.

8. For the purposes of sub-section 160 (3) of the Assessment Act, this Act shall be deemed to be the Act declaring the rates of income tax payable for the financial year commencing on 1 July 1976.

Indexation.

9. (1) In this section—

“index number”, in relation to a quarter, means—

(a) the All Groups Consumer Price Index number, being the weighted average of 6 State capital cities, published by the Australian Statistician in respect of that quarter; or

(b) if the Australian Statistician has published an index number in substitution for the index number referred to in paragraph (a)–the substituted index number;

“relevant amount” means any of the amounts specified in column 1 of Schedule 1;

“relevant year of income” means the year of income commencing on 1 July 1977 or a subsequent year of income.

(2) If the factor ascertained in accordance with sub-section (3) in relation to a relevant year of income is greater than 1, this Act has effect in relation to that relevant year of income as if for each relevant amount there were substituted an amount calculated by multiplying—

(a) in a case to which paragraph (b) does not apply—the relevant amount; or

(b) if, by virtue of another application or other applications of this section, this Act had effect in relation to a year of income or years of income preceding that relevant year of income as if another amount or other amounts were substituted for the relevant amount–the substituted amount or the last substituted amount, as the case may be,

by that factor or, where a lesser factor is prescribed by regulations made under sub-section (4) in relation to that relevant year of income, by that lesser factor.

(3) The factor to be ascertained for the purposes of sub-section (2) in relation to the relevant year of income is the number ascertained by dividing the sum of—

(a) the index number in respect of the March quarter immediately preceding that relevant year of income; and

(b) the index numbers in respect of the 3 quarters that immediately preceded that quarter,

by the sum of—

(c) the index number in respect of the March quarter immediately preceding the year of income that next preceded that relevant year of income; and

(d) the index numbers in respect of the 3 quarters that immediately preceded that last-mentioned quarter.

(4) The Governor-General may make regulations prescribing, in relation to a relevant year of income, a factor (not being a factor less than 1) for the purposes of sub-section (2).

(5) In making regulations prescribing a factor in relation to a relevant year of income, the Governor-General shall have regard to–

(a) whether any factor ascertained in accordance with sub-section (3) in relation to a year of income preceding that relevant year of income was less than 1; and

(b) the extent (if any) that the factor ascertained in accordance with sub-section (3) in relation to that relevant year of income was contributed to by indirect taxes.

(6) Except in the case of a year of income in relation to which a factor has been prescribed by regulations made under sub-section (4), the Treasurer shall cause to be published in the Gazette before the commencement of each relevant year of income the factor ascertained in accordance with sub-section (3) in relation to that year of income.

(7) Where, but for this sub-section, this Act would, by virtue of the preceding provisions of this section, have effect in relation to a relevant year of income as if for a relevant amount there were substituted another amount that consists of a number of whole dollars and a number of cents (in this sub-section referred to as the “relevant number of cents”)–

(a) in the case where the relevant number of cents is less than 50–the other amount shall be reduced by the relevant number of cents; or

(b) in any other case–the other amount shall be increased by the amount by which the relevant number of cents is less than $ 1.

Application.

10. The rates of tax declared by this Act apply for the financial year commencing on 1 July 1976 and for all subsequent financial years.

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SCHEDULE 1 Sub-section 5(1)

GENERAL RATES OF TAX

The rate of tax in respect of each part of the taxable income specified in column 1 of the following table is the rate per centum set out in column 2 of that table opposite to the reference to that part of the taxable income:

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SCHEDULE 2 Sub-section 5 (2)

RATES OF TAX BY REFERENCE TO AN AVERAGE INCOME

In the case of a taxpayer to whose income Division 16 of Part III of the Assessment Act applies, the rates of tax are–

(a) for every $ 1 of so much of the taxable income as does not exceed $ 16,000–

(i) the amount ascertained by determining the tax that would be payable if the rates set out in Schedule 1 were applied to a taxable income equal to his average income and dividing the resultant amount by a number equal to the number of whole dollars in that average income; or

(ii) the amount ascertained by determining the tax that would be payable if the rates set out in Schedule 1 were applied to a taxable income equal to $16,000 and dividing the resultant amount by 16,000,

whichever is the less; and

(b) for every $1 of the remainder of the taxable income, the amount ascertained by deducting from the tax that would be payable if the rates set out in Schedule 1 were applied to the total taxable income the amount ascertained by determining the tax that would be payable if the rates set out in Schedule 1 were applied to a taxable income of $16,000 and dividing the resultant amount by a number equal to the number of whole dollars in that remainder.

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SCHEDULE 3 Sub-section 5(3)

RATE OF TAX BY REFERENCE TO A NOTIONAL INCOME

For every $1 of the taxable income of a taxpayer deriving a notional income, as specified by section 59ab, 86 or 158a of the Assessment Act, the rate of tax is the amount ascertained by dividing the tax that would be payable under Schedule 1 upon a taxable income equal to his notional income by a number equal to the number of whole dollars in that notional income.

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SCHEDULE 4 Sub-section 5(4)

RATE OF TAX PAYABLE BY A TRUSTEE IN PURSUANCE OF SECTION 98

OR 99 OF THE ASSESSMENT ACT

The rate of tax in respect of the net income of a trust estate in respect of which a trustee is liable, in pursuance of section 98 or 99 of the Assessment Act, to be assessed and to pay tax is the rate that would be payable under Schedule 1, 2 or 3, as the case requires, if one individual were liable to be assessed and to pay tax on that income as his taxable income.