We have tasked the Board of Taxation to undertake an independent review of the Albanese Government's thin capitalisation reforms.
Our thin capitalisation reforms target the excessive use of debt deductions to avoid paying tax in Australia, and are in line with the OECD's best practice guidance.
These reforms are all about ensuring multinationals pay a fairer share of tax in Australia.
When multinationals exploit loopholes to pay less tax, they're gaining an unfair advantage over local businesses.
As part of the independent review, the Board will consider the overall performance of the amendments in strengthening Australia's thin capitalisation rules.
The Board will undertake public consultation to inform its final report, which we have asked it to provide within 12 months.
The independent review of the thin capitalisation reforms is a statutory requirement, stipulated when the legislation passed in April 2024.
The three big economic priorities for the Albanese Government this year are addressing inflation, productivity and global uncertainty, and ensuring multinationals pay a fairer share of tax through reforms like these is an important part of our agenda.
