The measure takes effect from 14 May 2013 but the details are subject to consultation with submissions due by 12 July 2013 which raises a question as to when will these measures be passed into law, noting that Parliament will be prorogued prior to the September 14 election?
As companies approach key financial reporting dates they will need to carefully consider the financial reporting impacts. Under the current law they can claim an immediate deduction for the purchase price of exploration rights and information first used for exploration but this could be clawed back and spread over 15 years if these measures subsequently pass into law.
Although the 15 years write off allows for a shorter period for rights with a shorter effective life, for example, if the exploration project is unsuccessful and the exploration right is relinquished, it will none the less be a surprise. The consultation conducted by the Business Tax Working Group led many to anticipate a write off period of 5 years.