In the wake of the Multiflex decision, Tax and Superannuation Laws Amendment Act (2012 Measures No.1) Act 2012 was introduced to amend the Taxation Administration Act 1953 to allow the Commissioner of Taxation to hold refunds for verification prior to payment. Yesterday, the Commissioner published PSLA 2012/6 ‘Exercise of the Commissioner’s discretion under section 8AAZLGA of the Taxation Administration Act 1953 to retain an amount that would otherwise have to be refunded’. The purpose of the practice statement is to provide guidance to tax officers on when it is reasonable to exercise the Commissioner’s discretion to delay a refund amount pending verification of the taxpayer’s entitlement to the amount.
An analysis of the practice statement will be posted next week.
In September the Tribunal handed down its decision in in AP Group Limited and Commissioner of Taxation  AATA 617, finding that the taxpayer’s objection was partially allowed, on the basis that certain incentive payments were not consideration for a supply. The Tribunal handed down its interim decision in July 2012,  AATA 409.
The Federal Court portal shows that on 12 October 2012 the taxpayer lodged an appeal to the Federal Court. Also, on 19 October 2012 the Commissioner lodged a cross-appeal. Given both parties have appealed, it would appear that the Federal Court will have an opportunity to consider one of the fundamental planks of GST, namely whether payments are consideration for, or in connection with, a supply.
The matter has been set down for directions on 6 November 2012. Because the decision was by two Deputy Presidents, the appeal can be heard by the Full Federal Court (rather than a single Judge) if considered appropriate. One would expect that this would likely be the case.
My post discussing the Tribunal’s decision can be accessed here.