On May 8th 2014, the Australian Treasury released draft legislation for public comment relating to changes to Australia's thin capitalization rules. The legislation provides for the following changes:
- A reduction in the safe harbor debt to equity ratio from 3:1 to 1.5:1 for general entities, and from 20:1 to 15:1 for non-bank financial entities
- A reduction in the worldwide gearing ratio test for outbound investment from 120% to 100%
- An increase from 80% to 100% for the worldwide capital rat…