The Bankruptcy Legislation Amendment (Anti-Avoidance) Bill 2006 – No Toothless Tiger!

On 29 March 2006, the Bankruptcy Legislation Amendment (Anti-Avoidance) Bill 2006 (the amendments) was passed by the Senate. The amendments are not retrospective and are expected to commence before the end of the 2006 financial year.

The amendments arguably represent the most controversial bankruptcy legislation in recent history. The amendments first emerged on 22 March 2001, when the Attorney General’s department announced the establishment of a Taskforce to consider whether changes should be made to Australia’s bankruptcy and taxation legislation to address high income earners using bankruptcy to avoid paying debts. Since 2001, the Federal Government has released draft legislation, withdrawn it, revised it and released it again, all in response to over 40 submissions lodged in response to a Discussion Paper by registered trustees, professional bodies, financial advisors and lawyers.