Table F.8 Fiscal costs of mutual recognition for Australiaa The assumed use of MRIC credits is based on a range of ABS data SNZ data distribution rates for FDI (as below), and existing actual distribution rates for FPI Assuming all shareholders on top tax rate of 45c 75% dividend distribution 555 745 50% dividend distribution 370 510 25% dividend distribution 190 275 If MRIC increased the FDI dividend distribution rate by 25%, the above cost estimates adjust by: -99 -128 Or allowing for CGT (on an accrual basis): +69 -90 Assuming a distribution of shareholder tax rates 75% dividend distribution 615 830 50% dividend distribution 415 570 25% dividend distribution 215 305 If MRIC increased the dividend distribution rate by 25% points, the above cost estimates adjust by: -25 -35 -93 +118 Or, allowing for CGT (on an accrual basis): Assuming all shareholders are super funds on a rate of 15%: 75% dividend distribution 750 1015 50% dividend distribution 510 695 25% dividend distribution 260 375 If MRIC increased the dividend distribution rate by 25% points, the above cost estimates adjust by: +135 +175 Or, allowing for CGT (on an accrual basis): +210 +272 a Based on five year average of total Australian investment in New Zealand from 2007-2011, and the New Zealand 28 percent company tax rate. All figures are in $NZ million. References Australian Government Tax Working Group (The Treasury)2012, ‘Business discussion 2012, http://www.treasury.gov.au/~/media/Treasu paper’, August (accessed 27 November 2012). Tax System Panel 2010, Report to the Treasurer (Henry Australia’s Future Review), Commonwealth of Australia, Canberra. Benge, M. and Slack, H. 2012, A framework for considering ‘Mutual Recognition: costs and presented to Australian and New Zealand benefits’, Paper
Table F.8 Fiscal costs of mutual recognition for Australiaa The assumed use of MRIC credits is based on a range of distribution rates for FDI (as below), and existing actual distribution rates for FPI ABS data SNZ data Assuming all shareholders on top tax rate of 45c 75% dividend distribution 555 745 50% dividend distribution 370 510 25% dividend distribution 190 275 If MRIC increased the FDI dividend distribution rate by 25%, the above cost estimates adjust by: Or allowing for CGT (on an accrual basis): -99 +69 -128 -90 Assuming a distribution of shareholder tax rates 75% dividend distribution 615 830 50% dividend distribution 415 570 25% dividend distribution 215 305 If MRIC increased the dividend distribution rate by 25% points, the above cost estimates adjust by: Or, allowing for CGT (on an accrual basis): -25 -93 -35 +118 Assuming all shareholders are super funds on a rate of 15%: 75% dividend distribution 750 1015 50% dividend distribution 510 695 25% dividend distribution 260 375 If MRIC increased the dividend distribution rate by 25% points, the above cost estimates adjust by: Or, allowing for CGT (on an accrual basis): +135 +210 +175 +272 a Based on five year average of total Australian investment in New Zealand from 2007-2011, and the New Zealand 28 percent company tax rate. All figures are in $NZ million. References Australian Government (The Treasury)2012, ‘Business Tax Working Group discussion paper’, August 2012, http://www.treasury.gov.au/~/media/Treasu (accessed 27 November 2012). Australia’s Future Tax System Panel 2010, Report to the Treasurer (Henry Review), Commonwealth of Australia, Canberra. Benge, M. and Slack, H. 2012, ‘Mutual Recognition: A framework for considering costs and benefits’, Paper presented to Australian and New Zealand