The Australian Government has announced that it will introduce a 60 percent capital gains tax discount (CGT) for investors in affordable rental housing.
The Government has released draft legislation to implement a number of housing affordability policies.
From January 1, 2018, residents investing in eligible affordable housing will be entitled to a CGT discount of up to 60 percent if they hold the investment for at least three years. The standard discount rate is 50 percent.
The Government also intends to permit managed investment trusts (MITs) to invest in affordable housing. Effective July 1, 2017, MITs will be permitted to hold affordable housing for the purpose of deriving long-term rent, and to derive other eligible business income from investments including shares or commercial property. MITs will be allowed to construct or develop the affordable property within the MIT.
Consistent with current MIT withholding tax rules, eligible foreign residents will generally be able to take advantage of a reduced withholding tax of 15 percent on investment returns, including income from capital gains. However, this concessional rate will not apply to capital gains income derived from selling affordable housing held for less than 10 years.
However, from 16:30 AEST on September 14, 2017, MITs will not be permitted to acquire residential property, unless it qualifies as affordable housing. The aim is to prevent MITs from investing in houses, units, and apartments to hold for long term rent (other than affordable housing). It is also intended to clarify the long-standing convention that the primary purpose of the MIT concessional tax treatment is to apply to passive investment income.
MITs currently holding residential property will be provided with a transitional period until October 1, 2027, for their existing property assets.
To qualify for the higher discount and MIT concessional tax treatment, affordable housing tenancies will need to be managed by a registered Community Housing Provider. Housing providers will determine the tenant eligibility criteria, including the rent charged, consistent with state and territory affordable housing policies.
Switzerland's lower house of Parliament on May 29, 2018, approved DTAs with Kosovo and Pakistan.
The Moroccan Government has approved for ratification a DTA with the Republic of the Congo, it announced on May 29, 2018.
Argentina has approved a protocol to its DTA with Brazil, the Argentinian Official Gazette reported on May 23, 2018.
Brazil's upper house of Parliament on May 30, 2018, approved a protocol updating the DTA with Norway.
Hong Kong and Finland on May 24, 2018, signed a DTA.
Legislation ratifying a new DTA between Russia and Japan was submitted to the Russian State Assembly (the Duma) for approval on May 22, 2018.
Vietnam and Macau signed a DTA on April 16, according to a statement released by the Vietnamese Ministry of Finance on May 11, 2018.
Talks are continuing on a DTA between Jordan and Switzerland, according to a statement released by Jordan's Foreign Ministry on May 14, 2018.
The Czech Senate approved a law to ratify the DTA with Ghana on May 17, 2018.
The Philippines-Thailand DTA entered into force on March 5, and the Philippines' DTA with Sri Lanka on March 14, the Filipino tax agency announced on May 17, 2018. They will be effective from January 1, 2019.
Jordan's Minister of Planning and International Cooperation met with Luxembourg's Finance Minister to discuss enhanced cooperation between the two countries in a number of areas and agreed to seek to conclude a DTA.
Uzbekistan and Lithuania are to engage in talks towards a DTA, Uzbekistan's state news agency reported May 9, 2018.
Two Georgian committees approved the text of a DTA with Saudi Arabia and forwarded it for ratification, according to a May 17 announcement on the Georgian parliament's website.
Hong Kong gazetted an order to ratify its DTA with Saudi Arabia on May 18, 2018.
Talks are continuing on a DTA between Turkey and Afghanistan, according to a statement released by Turkey's Ministry of the Interior on May 11, 2018.
A new DTA between Finland and Spain will enter into force in January 2019, according to a May 18, 2018, announcement from the Finnish tax authority.
Andorra and Cyprus have signed a DTA, Andorra's Government announced on May 18, 2018.
Singapore and Brazil signed a DTA on May 7, 2018.
A DTA between Morocco and the Congo was signed on April 30, 2018.
The Mauritius Revenue Authority on March 19, 2018, published Government Notice No. 36 of 2018, confirming the entry into force of a Protocol updating its DTA with Barbados.
Legislation allowing for a DTA between the Netherlands and Malawi was ratified on April 30, 2018.
Switzerland and Brazil signed a DTA on May 3, 2018.
Slovakia on April 27, 2018, published Notice 123/2018 confirming the entry into force of its DTA with Ethiopia.
The Indian Government on May 7, 2018, announced that the DTA Protocol signed with Kuwait entered into force on March 26, 2018. A notice was published in India's Official Gazette on May 4, 2018.
The DTA between Slovakia and Iran became effective on May 1, 2018.