The meaning of 'market value' in Australia's Income Tax Assessment Act 1997.
Journal of the Australasian Tax Teachers Association, 9 (1), 103-125.
The article examines the use of the term ‘market value’ in certain sections of Australia’s Income Tax Assessment Act 1997. It highlights the significant disparity which potentially arises between the hypothetical market context, which established legal principle suggests should be applied to market value determinations, and real-world market scenarios faced by taxpayers. As shown by the court and tribunal decisions examined in the article, inconsistency exists as to the extent to which market forces operating in the real world impact upon market value determinations. As a result, there is an absence of clear guidance from the courts and the Administrative Appeal Tribunal (AAT) on a key issue — how market factors faced by taxpayers in the actual market in which they engage should feed into the assumptions underlying the hypothetical market by which market value determinations are made. This is the source of significant uncertainty and confusion for taxpayers. The article sheds some light on this problem and suggests a possible solution.
Income Tax Assessment Act 1997, market value, market forces, taxpayers