AUSTRALIAN TAXATION OFFICE
HIGHER EDUCATION SUPPORT ACT 2003, TRADE SUPPORT LOANS ACT 2014, STUDENT ASSISTANCE ACT 1973
Factor to Index an Accumulated HELP, TSL or Financial Supplement Debt
I, JANE ASHWIN, of the Australian Taxation Office, HEREBY NOTIFY, pursuant to section 140-20 of the Higher Education Support Act 2003, section 34 of the Trade Support Loans Act 2014 and subsection 12ZF(7A) of the Student Assistance Act 1973 that 1.015 is the HELP, TSL and Financial Supplement debt indexation factor for 1 June 2016 to be used in working out accumulated HELP, TSL and Financial Supplement debts for the 2015-2016 financial year.
In accordance with section 140-10 of the Higher Education Support Act 2003, section 32 of the Trade Support Loans Act 2014 and subsection 12ZF(6) of the Student Assistance Act 1973, the HELP, TSL and Financial Supplement debt indexation factor is the number worked out to three decimal places using the formula:
the sum of the index number for the March 2016 quarter and the index numbers for the three immediately preceding quarters
divided by
the sum of the index number for the March 2015 quarter and the index numbers for the three immediately preceding quarters,
where index number, in relation to a quarter, means the All Groups Consumer Price Index number, being the weighted average of the eight capital cities, published by the Australian Statistician in respect of that quarter.
Indexation factor for 1 June 2016 = Mar16+Dec15+Sep15+Jun15
Mar15+Dec14+Sep14+Jun14
= 108.2 + 108.4 + 108.0 + 107.5
106.8 + 106.6 + 106.4 + 105.9
= 432.1 divided by
425.7
= 1.015 (to three decimal places)
The indexation factor is 1.015 and the effective percentage increase is 1.5%.
Dated this ____4th____ day of __May____ 2016
___________Jane Ashwin___________________
Overview
The Australian Taxation Office Higher Education Support Act 2003, Trade Support Loans Act 2014, and Student Assistance Act 1973 collectively address issues related to student financial assistance and loans in Australia. Enacted by the Australian Parliament, these Acts were introduced to provide a structured approach to managing higher education costs and supporting students through financial supplements and loans. This gazette, issued by Jane Ashwin of the Australian Taxation Office, notifies the indexation factor for accumulated HELP, TSL, and Financial Supplement debts, effective for the 2015-2016 financial year. The policy objective of these Acts is to ensure that the debt amounts are adjusted in line with inflation, as measured by the All Groups Consumer Price Index, thereby maintaining the real value of the debts over time. The indexation factor for 1 June 2016 has been calculated at 1.015, reflecting a 1.5% increase from the previous year.
Scope and Application
The Australian Taxation Office Higher Education Support Act 2003, Trade Support Loans Act 2014, and Student Assistance Act 1973 collectively govern the indexing of accumulated HELP, TSL, and Financial Supplement debts, applying to individuals and entities that have accumulated debts under these schemes. This legislation applies on a Commonwealth level, affecting those within Australia's jurisdiction. The application of these Acts is not restricted by specific exclusions, exemptions, or thresholds beyond the scope of the debts themselves. The indexation factor, calculated annually based on the All Groups Consumer Price Index number, ensures the debts are adjusted according to inflation, reflecting changes in the cost of living. This indexation factor is mandated by the respective Acts, with the calculation formula stipulated to maintain consistency and fairness in adjusting debts. Any further specification or implementation details may be addressed through subordinate instruments issued under the authority of these Acts.
Key Provisions
The Australian Taxation Office, under the authority of the Higher Education Support Act 2003 (section 140-20), the Trade Support Loans Act 2014 (section 34) and the Student Assistance Act 1973 (subsection 12ZF(7A)), has determined that the debt indexation factor for HELP (Higher Education Loans Program), TSL (Trade Support Loans) and Financial Supplement debts for the period from 1 June 2016 is 1.015. This indexation factor is to be used to calculate the accumulated debts for the 2015-2016 financial year. The indexation factor is derived from a calculation using the All Groups Consumer Price Index numbers for the relevant quarters, as prescribed by the respective sections of the Acts.
The obligation under these sections is for the Australian Taxation Office to determine and notify the indexation factor, and for those with HELP, TSL or Financial Supplement debts to use this factor in their calculations. The indexation factor is a mathematical formula that sums the index numbers for the March quarter and the three preceding quarters, divided by the sum of the index numbers for the March quarter of the previous year and the three preceding quarters of that year. This calculation ensures that the indexation factor reflects changes in the cost of living, as measured by the Consumer Price Index.
Failure to comply with the provisions of these Acts may result in penalties. While the specific penalties are not detailed in the gazetted notification, under the Higher Education Support Act 2003, breaches of the Act can result in penalties up to a maximum of 200 penalty units (currently AUD 24,000) for individuals and 1,000 penalty units (currently AUD 120,000) for companies. The Trade Support Loans Act 2014 and the Student Assistance Act 1973 also carry potential penalties for non-compliance, although the exact penalties are not specified in the text. It is important for those affected by these Acts to ensure they adhere to the prescribed indexation factor to avoid potential civil or criminal consequences.