Shayne Neumann (Blair, Australian Labor Party) Share this | Hansard source

I rise to speak in support of the Tax Laws Amendment (2008 Measures No. 6) Bill 2008, which is an important tidying up of some significant changes in corporate law and the CGT rollover situation. It is important that, when companies undertake restructures, they do not do it in a way that minimises return to taxpayers in a way that is unfair to the integrity of the taxation system. And it is important for taxpayers to know, when they pay tax out of their pay every week or every fortnight, that companies do the same and do it correctly with respect to corporate tax and CGT.

This is just the sort of provision that should have bipartisan support, and I am pleased that the coalition is supporting it. As the shadow minister mentioned, there will be some tidying-up amendments to this bill, which will make an important improvement with regard to the status of moneys given for charitable purposes for the recovery and reconstruction of the communities in Victoria and in Far North Queensland, which are so suffering at this time. Our thoughts are with them. I see that, tragically, the forecast for North Queensland is for rain yet again overnight. The people up there have suffered enormously in terms of dislocation, damage to property and injury to persons, as well as in terms of profit loss to business. It is just tragic what has happened to them, and they must not be forgotten.

The amendments in this bill are by way of schedule. I will deal with the first schedule very briefly. It relates to modification of the capital gains tax provisions for corporate restructures. Companies will not anymore be able to obtain a market value cost base for shares and certain other interests acquired in another entity following a scrip-for-scrip CGT rollover under an arrangement that is taken to be a restructure. That is important in terms of the integrity of the system. It is important that the government address this issue. The previous government attempted to address this in October 2007. They issued a press release in relation to the matter, but it caused more confusion in the marketplace than they intended.

The government is doing this reform because it is well targeted and well measured. There has been tremendous community consultation across the sector in relation to this measure. It will not impact on genuine commercial transactions. If companies engage in proper arrangements, then they are not going to be affected. This is about the integrity of the tax system. Companies will no longer be able to effectively rip off the Australian taxpayers by very elaborate corporate restructures in this way. So I am very supportive of this measure. I know my electors in Blair pay their tax. I am sure every member of this chamber hears from their constituents that they pay too much tax and do not necessarily get value for the tax dollars they pay, so it is important that companies, who are well financed—many of them—and who have access to good accountancy advice and accurate legal advice, are prevented from restructuring their corporate arrangements in this way. I am pleased that the coalition is supporting us on this measure.

The second schedule makes some minor amendments to assistance-in-collection provisions in schedule 1 to the Taxation Administration Act 1953, to get over some identification problems in relation to effective administration. The shadow minister outlined those provisions and I am not intending to go into them in any great detail. Suffice it to say that the measure will ensure that the collection provisions of the Taxation Administration Act operate with efficiency and effectiveness and ensure that we can as a country meet our obligations under the relevant international agreements that we enter into with other nations.

It is important that we as a country meet our existing and future treaty obligations with other countries in terms of a whole range of issues, whether it is in business, child support, trade or the collection of taxation debts. These are important measures in the circumstances. They are largely administrative in their character but they are important insofar as they significantly impact upon debtors resident in Australia or having assets in Australia and owing money in other countries. It is an important measure that shows what kind of goodwill and what kind of nature we have as a country that we will fulfil obligations and ensure that our citizens do the right thing by friendly countries and other countries in our region and beyond.

The third measure, schedule 3, is in relation to late offset for superannuation guarantee contributions. Again, this is an administrative measure but it will amend the Superannuation Guarantee (Administration) Act 1992 to tighten the period within which an employer can make a late superannuation guarantee contribution and still be able to use the late payment offset to reduce their superannuation guarantee charge liability and vary the calculation of the general interest charge on unpaid superannuation guarantee charges where the employer has elected to use the offset. This particular measure will encourage employers to pay the superannuation guarantee in a more timely way. It is important that employers fulfil their obligations. They expect their employees to fulfil their obligations in the workplace, and it is important that employers do the right thing by their employees. The offset, of course, allows an employer who makes a late superannuation guarantee contribution for an employee to use that contribution to offset against part of their superannuation guarantee charge liability which is charged if they do not pay the superannuation guarantee on time.

Currently, there is no actual time limit in which the employer is required to make the contribution, and the amendments will specify that an employer will be able to use the offset if they make the contribution before they are assessed with the superannuation guarantee charge liability. It is important also that it amends the calculation of the general interest charge on an unpaid superannuation guarantee liability where the offset is used. The explanatory memorandum and the information I have received from the Parliamentary Library suggest that we might be able to save about $25 million for the Australian Taxation Office in the current financial year, and that is not to be sniffed at—$25 million in this current climate is an important saving. These three schedules are important; they are worth noting; and they are worth bipartisan support. I am pleased that it is receiving that support.

The final thing I want to talk about is the amendments which the Minister for Superannuation and Corporate Law has foreshadowed in the circumstances and which the shadow minister for financial services, superannuation and corporate law also mentioned. They are the amendments to ensure that charities collecting donations for bushfire victims are tax-deductible. It goes beyond that, of course, to other disastrous circumstances. Curiously, the Australian Taxation Office has taken the view, as I understand it, that we need legislative change because of problems with the definition of what is a charitable donation, what is a charity and what should get tax concession status. Currently, according to what I have read in relation to this matter, there is a need for amendments to our tax laws to ensure that those persons who make donations for long-term recovery and reconstruction of the community infrastructure in Victoria in these terrible times should receive the benefits of tax deductibility.

So what we are doing here in this regard is specifically listing the Red Cross’s and the Victorian government’s 2009 Victorian bushfire appeal as a tax-deductible gift recipient for a five-year period, and that will allow tax-deductible donations for that purpose. We are also doing more than that: we are allowing further concessions to be made and amending the disaster relief category to allow a Treasury minister to declare a disaster for tax purposes, and it goes on. So there are some important amendments in this regard which will help to allow donations and assistance which have been given in circumstances of fire, flood and other disasters to be used for the benefit of people such as those in Victoria and North Queensland.

I want to say briefly in relation to that that the Red Cross are to be commended for the work they have done in Victoria and also in Queensland. I have heard about what they have done, and the Red Cross are such a wonderful organisation, deserving of the kind of assistance the Australian people have given them. The kind of legislative change that the minister has circulated will help the Red Cross in their operations.

The minister has said that the bill amends various tax laws to implement a range of improvements to Australia’s tax legislation. I have to say that I agree with him. I think that that is the case with these amendments. Having gone through them carefully, I think that the bill makes our tax system more efficient and effective and gives it greater integrity. It also gives the kind of security that we need to ensure that our tax system operates in a way which is fair to our citizens and also deals with other countries in such a way that they know we are prepared to do our bit when it comes to international tax collection.

Finally, I want to pay tribute to the Red Cross workers who will get so much benefit from these deductions which are foreshadowed in the amendments. They have come to my electorate in the last few months to help us with the storms and floods which there have been in South-East Queensland, including in my electorate of Blair. I have to give a tribute to the five Red Cross workers from Bendigo who came up to help us. Their enthusiasm, compassion and humanity were on display for all to see. I took the Minister for Human Services to the recovery centre in Ipswich. The mood was infectious, and I want to say that the Red Cross have done a marvellous job. Anything we can do in terms of amendments to our tax laws to help the Red Cross is of great merit. I want to pay tribute to them and thank them for the wonderful work they have done locally in the federal electorate of Blair, in Victoria and in North Queensland with our sisters and brothers, our fellow Queenslanders, who have suffered so much at this time. I commend the bill to the House.

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