The nature of “goodwill” for tax purposes was an important issue in Australia long before the adoption of the Commonwealth income tax, with the relationship between goodwill and sales of business premises a central issue in colonial stamp duty assessments (and consequent litigation)....

In this article, the authors discuss a recent Australian High Court case and argue that Australia's legislative framework dictating the distinction between capital and current expenses is inadequate and poses unnecessary judicial roadblocks.The High Court of Australia's October 16 decision in...