The Senate Economics Committee’s review of the proposed Thin Capitalisation legislation has been labeled as “a missed opportunity to fix the Bill”.
The Commitee, reviewing the legislation for a second time after amendments were made last year recommended the Senate pass the Bill in its current form. It is expected to pass the Senate later this week.
Property Council Group Executive Policy & Advocacy Matthew Kandelaars said the Treasury Laws Amendment (Making Multinationals Pay Their Fair Share – Integrity and Transparency) Bill 2023 continues to threaten the government’s 1.2 million homes by 2029 goal.
“If passed in its current form, this Bill will turn investment away from our cities and will hurt the supply of homes we desperately need,” Mr Kandelaars said.
“Instead of aligning with the government’s housing goals, this Bill works against them.
“Even with some welcomed government amendments, the Bill continues to hinder authentic commercial and business endeavours within the property sector.
“This will diminish the appeal of the Australian property sector for global investment and constrain much-needed investment to build the homes we need.
“Australian businesses, utilising exclusively Australian assets and debt for investments within the country, find themselves entangled in a profit-shifting prevention Bill, without any available offshore jurisdiction for profit redirection. This issue shows the extent of drafting overreach and, at the very least, requires a prompt fix.
“More broadly, the Bill will result in diminished investment returns for multiple large-scale projects, particularly in sectors like housing and build-to-rent, making them financially unviable to proceed.
“While we welcome the amendments made to the Bill since it was first introduced, we will continue to work with the government and the Senate to ensure that this Bill maintains Australia’s appeal as an investment destination,” he said.
Senator Andrew Bragg said investment in much needed Australian housing will be diminished as a result of the Bill passing.