Labor has begun its push to make Australia's financial services internationally competitive, re-evaluating the industry's tax system.
The Federal Government has announced it will review the taxation regime of managed funds.
"Undertaking a review of the income tax arrangements applying to managed investment trusts is a key part of the Government's commitment to make Australia the financial services hub of Asia," Assistant Treasurer Chris Bowen told an audience at the Investment and Financial Services Association (IFSA) lunch in Sydney on Friday.
The government will also review withholding tax arrangements and has issued a consultation paper that will look at abolishing the outdated Section 6C tax.
This will further simplify the tax system for managed investment schemes and real estate investment schemes (REITs).
"I stated that it was vital that Australia has a simple, transparent and internationally competitive system of taxation. I have asked the board to complete its review by the middle of 2009," Bowen said.
IFSA welcomed the government's announcement.
"A competitive financial services export industry relates to an efficient tax system. All we are asking for is a level playing field," IFSA board member and BT Financial Group chief executive Rob Coombe said.
"It's wonderful to see a government focused on the long-term rather than the short-term approach that we have seen in the past."
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