The ATO has just launched the New Investment Engagement Service (NIES) as part of the Morrison government’s efforts to attract more foreign investment to the country. This service will complement the already established Global Business and Talent Attraction Taskforce by offering new investors a chance to enjoy hands-on guidance and support on the tax implications of their investments.
This service will be offered to foreign investors coming into the country through the task force. It will also extend to existing investors who are looking to expand their investments by a further $250 million or more.
Under NIES, these investors will be assigned ATO specialists with whom they can liaise on proposed commercial transactions before their execution. Once they provide details on the transaction, they can highlight what tax issues they need an opinion on and any other commercial concerns. In return, the NIES will generate a report of their opinion, including material risks and how they may be mitigated. They will also be advised on how to prepare for any further reviews.
According to Assistant Treasurer, Michael Sukkar, the service will aid investors with objective information, promote confidence, and assist in understanding possible tax risks from their investments. He added that this would help investors make better-informed decisions and improve the process of investment.
It will be up to the investors to opt-in for this tailored service which will offer them the benefits of guidance on what ATO services and programs they are eligible for, gaining an understanding of compliance, expedited rulings, and advance pricing agreements. Those going through the Foreign Investment Review Board (FIRB) will also receive assistance.
From the onset, both the investors and NIES will need to agree on commercial time frames of investment to better streamline the process and ensure deadlines associated with transactions are met. But the initiative will not interfere with private rulings and Advance Pricing Agreements. The NIES team will however assist where it can for investors to achieve desired outcomes in as short a time as possible.
The NIES program is part of the 2021 Budget initiatives proposed by the Morrison government to aid in attracting global businesses to invest and relocate to Australia. It will go towards supporting a raft of other measures including streamlining of employee share ownership schemes, simplification of tax residency rules, financial service license changes, and the introduction of the Global Talent Visa. These moves are expected to lure in more investors are a time when the UK and US are looking to boost corporate taxes while Hong Kong faces political upheavals.