Christopher Pyne (Sturt, Liberal Party, Shadow Minister for Education, Apprenticeships and Training) Share this | Hansard source

The original aim of the Tax Laws Amendment (Political Contributions and Gifts) Bill 2008 was to remove all tax deductibility for donations to political parties. This was unquestionably an overreaction on the part of the Labor Party. We believe that at the core of the democratic process is the participation of ordinary Australian citizens. They are the ones who make up our electors and they are the ones who are the foundations of our political parties—especially on our side of the House. There are quite a few academics and commentators who talk about the antidemocratic nature of big donations from business and the unions. Yet I do not know of a single one who believes there should be less participation by ordinary Australians. The original bill would have done just that.

By removing the income tax deduction for donations, Labor would have effectively pushed the parties to place a greater emphasis on three categories of donors: businesses, who can claim the donation back in other ways; unions, who do not care about a $1,500 tax break; and high net worth individuals, who do not need a $1,500 tax break. That was Labor’s solution. No wonder that even the Greens, who normally support the most extreme positions on electoral reform, simply would not stomach or support the bill in its original form.

To this end, the coalition supports the changes that have been proposed in the Senate. If we are serious about improving participation rates in the political process, we cannot put more disincentives and more hurdles in the way. Perhaps Labor realises that it no longer has the support of ordinary Australians in terms of finance and is betting its future on the accumulated wealth of decrepit and dying trade unions. The irony is that fees to trade unions, which invariably come back as donations to the ALP, are fully tax deductible. So Labor, as usual, wants to have its cake and eat it too. It does not surprise me that members of the New South Wales Labor Party have come in for this debate, because they watch it very closely. Those in the New South Wales Labor Party always want to have their cake and eat it too, but I think their day of reckoning might well be coming. But I digress. Similarly, people can make donations to quasi political, religious, environmental, welfare and foreign aid groups. All of those are fully tax deductible. But a donation to a political party is certainly not, under Labor’s original bill.

Our fundamental position is this. The coalition support greater participation by individuals in the political process. To facilitate that, we believe there should be a level of tax deductibility which is neither too high nor too low. A cap of $1,500 is in our view the correct amount. That is about three per cent of the annual earnings for an average Australian worker. In conclusion: let me again express the concern of the coalition that the ALP is tampering with electoral matters before the finalisation of the green paper on electoral reform. While I am normally loath to ascribe bad motives to the Labor Party, it does make one wonder why they feel the need to push ahead with a law which makes it harder for every party other than the ALP—with its union war chest—to raise funds for both the campaigning and the day-to-day operations of political parties. Surely the appropriate time for the consideration of any bill, as the one before us, would be after the government’s response to the green paper has been finalised.

I note the minister has tabled amendments today from the government, which he says will give effect to the amendments that the Senate passed and insisted upon. There were 17 amendments in the Senate that the coalition and the Greens supported, which therefore became part of the bill. We are debating today whether the House should support the Senate in insisting on its amendments. The coalition’s view is that we should support the amendments from the Senate, and we will not be disagreeing with those amendments. The minister has tabled new amendments today. The first I saw of those amendments was momentarily before I started speaking in the House. I am very alone, I notice.

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