It would appear that the current exceptions to this, listed securities and business real property, will remain. This change will not commence until the legislation is introduced. All existing investments will have to be unwound by 30 June 2001. This will involve significant dislocation and could have significant stamp duty and capital gains costs. It would appear that even a bare trust will be prohibited, and so steps will need to be taken to ensure the assets are vested in the trustee of the fund.
Difficult issues arise as to whether there is a dutiable transaction for stamp duty purposes.
Difficult issues also arise as to whether or not there is disposition for CGT purposes on the winding up of a trust. It is understood that the ATO has not been asked to consider whether any roll-over relief should apply. Not all geared investments will be banned. Endowment warrants should remain as there is no associate investment involved. There may also be a market for professional trustees to offer geared investment trusts as these should not be associates.