Peter Dutton (Dickson, Liberal Party, Minister for Revenue and Assistant Treasurer) Share this | Hansard source

I thank the members who have made a contribution to this debate on the Tax Laws Amendment (Repeal of Inoperative Provisions) Bill 2006. I begin by making a confession to this House that, up until the contribution by the member for Kennedy, I thought the most disastrous contribution that could ever be made to the Australian economy would be made by Kim Beazley as Prime Minister, given the way in which he tried to wreck the economy under the Keating government. The ignorant display by the member for Kennedy, then, is a very poor reflection on his contribution to this debate. I also want to thank, in particular, the member for Moncrieff, who made a very sound contribution to the debate.

This bill implements a variety of changes and improvements to the tax laws. In 2003, in accordance with the government’s aim of reducing complexity in tax laws, the Board of Taxation began a project to identify inoperative provisions in the tax laws. In October last year, it reported to the Treasurer that it had identified 2,100 pages of inoperative provisions in the income tax law and recommended that they be repealed. The government, of course, accepted that recommendation.

As well as the 2,100 pages of provisions identified by the Board of Taxation, this bill repeals a further 500 pages of income tax provisions that were subsequently identified as inoperative and 1,500 pages of inoperative provisions from other taxation acts. In total, the bill repeals over 4,100 pages of inoperative provisions, including over half of the Income Tax Assessment Act 1936, almost a third of the entire income tax law and 48 sales tax statutes that are wholly inoperative. Repealing the inoperative material will not only significantly reduce the length of the tax law but also make it easier to use and lower the compliance costs borne by those who use that law.

As well as repealing inoperative material, the bill makes some other improvements designed to make the tax laws easier to use. For example, it replaces multiple definitions of some terms with a single definition. Rationalising definitions in the tax law has been argued for by some taxpayer representatives and was recommended by the Banks task force report, Rethinking regulation, in January 2006. That sort of improvement will bring more consistency to the tax laws and make it simpler for taxpayers to understand and meet their obligations.

The flow-on effects of repealing the inoperative provisions will provide further benefits for taxpayers and tax practitioners. The Commissioner of Taxation has advised that approximately 200 public rulings that refer to provisions that are being repealed will be either revised or withdrawn. The commissioner is also working with tax professionals to improve the readability of other public rulings affected by the bill. Repealing the inoperative provisions and making the other improvements are important parts of the government’s continuing efforts to reduce the complexity of the tax law. The government will look for similar opportunities in the future to improve the tax laws and reduce the regulatory burdens and compliance costs faced by business and other taxpayers.

Before I conclude, I would like to make some comments on the second reading amendment in response to the member for Hunter. The first point I would make is that the member for Hunter has moved an amendment to repeal over 100 sections of the income tax law. The member for Hunter also moved an amendment to repeal a number of provisions that I am advised do not exist or are in fact being repealed by this bill. So it is worth making the point that Labor should never be trusted with numbers. Labor have no economic credibility.

The fact that, on the advice that I have, the member for Hunter has moved an amendment to repeal a number of provisions that do not even exist or are in fact being repealed by this bill that is before the House really shows how devoid he is of any credibility in this area. The member for Hunter wants to position himself as part of the alternative government of this nation, but he cannot even get his own amendments right. The government will have a look at those 100 or so sections. I will take some further advice. Hopefully that advice will say to me that the member for Hunter has not got it all wrong, but I suspect he probably has.

Removing inoperative provisions is of course an ongoing process. I remind the House that the process has seen the removal of over 4,100 pages of legislation covering literally thousands of sections. I also wish to correct the honourable member on another error that he made in his presentation to this House. The government has not presided over the growth of the income tax law to 10,000 pages, as asserted by the member for Hunter. In fact, the whole act does not number 10,000 pages, and, in any case, this government is repealing 2,600 pages of that legislation. That is a third of the total size of the income tax law.

I also want to respond to some erroneous claims by the member for Rankin, who claimed that the bill only withdrew 1,900 pages from the income tax law. Again, I repeat for the benefit of the member for Rankin that the bill does in fact remove 2,600 pages from the income tax law and 1,500 pages from other tax laws, making 4,100 pages in total. In conclusion, I thank members for their support of the government’s ongoing efforts to improve the quality of the tax laws and to make the tax laws and how they operate in this country more efficient. I commend the bill to the House.

Question put:

That the words proposed to be omitted (Mr Fitzgibbon’s amendment) stand part of the question.

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