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International Taxation

Welcome to the International Taxation section of the Treasury Departmental Internet site. Content within this section is managed by the International Tax and Treaties Division and includes information on:

  • international tax initiatives, such as the OECD’s Harmful Tax Practices Initiative, and
  • international taxation measures, such as Australia’s accruals regimes and tax treaties.

International Tax and Treaties Division

The International Tax and Treaties Division provides advice on international tax policy issues and implements Government decisions by developing related legislation and negotiating tax treaties. The accelerating integration of the Australian economy with global markets continues to challenge Australia’s international tax policy and legislative arrangements.

The Division improves the well-being of Australians through international taxation arrangements which enhance Australia’s economic position, integrate Australia in the global economy and raise revenue to meet the Government’s priorities.

  • ‘International taxation arrangements’ principally means arrangements relating to taxation of flows of income between Australia and other countries.

Primary Responsibilities

Reform to the Foreign Source Income Attribution Rules

The Division is involved in an extensive reform to Australia’s Foreign Source Income attribution rules. These rules apply to offshore interests held by Australian resident taxpayers. The major focus of the Division’s work in relation to this project is the development of tax laws in this area and involves extensive ongoing consultation with industry and tax practitioners.

Codification of the Tax Treatment of Sovereign Investments

The Division is working on codifying the tax treatment of sovereign investments. Presently, sovereign investors are able to apply to the ATO for an exemption from Australian tax in relation to certain investments. This process is conducted administratively through the ATO’s private ruling system. The codification of this tax treatment will provide greater certainty in relation to eligibility for the exemption, and will allow sovereign investors to more easily self-assess their tax position. The major focus of the Division’s work in relation to this project is the development of tax laws in this area and involves extensive ongoing consultation with industry and tax practitioners.

Tax Treaties

The Division also negotiates tax treaties to prevent double taxation of cross border income and is a major contributor to OECD discussions on tax treaty issues. An emerging workload involves the interface of free trade agreements and tax treaties, and managing the wider implications for tax law and policy of non discrimination obligations in tax and trade agreements.

Harmful Tax Practices Initiative

This OECD initiative is aimed at combating international tax evasion by promoting transparency and exchange of information both within and outside of the OECD. It involves representation in OECD and other international fora and a programme for progressing information exchange agreements on tax matters between Australia and countries that are committed to the initiative. It is the Division’s role to oversee the strategies and outcomes for these agreements which are negotiated by the Australian Taxation Office on Australia’s behalf. The Division also has responsibility for the parliamentary and legislative processes associated with these agreements.

For a quarterly summary of consultation undertaken on International Taxation measures, refer to details within the publication ‘Treasury's Consultation Processes on Announced Tax Measures’.

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