Delays in the development of a test case into managed investment schemes (MIS) has forced the Australian Taxation Office (ATO) to hold off issuing product rulings in the sector.
The ATO had previously advised the agribusiness industry it would begin issuing product rulings on MIS by the end of the year if the agribusiness sector won its test case.
In an attempt to assist the process, the tax office had even requested the upcoming May 13 court date be brought forward so the matter could be heard by the full Federal Court in its August sittings.
However setbacks in the test case’s development shelved these plans.
“Due to delays in developing and progressing industry’s test case it is now unlikely that a court decision will be handed down by 30 June 2008,” an ATO statement said.
“In the circumstances, we will continue to accept and work on requests for product rulings for the 2008-09 year but will hold off issuing them pending the decision by the Federal Court.”
In September last year the ATO issued Taxation Ruling TR 2007/08, which formally finalised its view.
“We noted that developments in case law required us to reconsider our views on the deductibility of investments in managed investment schemes. As the matter is not free from doubt, we advised our intention to urgently expedite a test case to obtain judicial opinion on our considered view,” the ATO said.
“We also advised that there would be a transition period for the new tax office view being until a decision from the court on test case or 30 June 2008, whichever is the earlier.”
Last year Australia’s agribusiness sector called for an inquiry into a non-forestry test case to examine the position of the ATO in court.
