Graham Perrett (Moreton, Australian Labor Party) Share this | Hansard source

No, visual artists, not writers, member for Mayo—for any increase in value when their work is resold. This bill addresses the tax implications of resale royalties. It amends the Income Tax Assessment Act 1997 to regulate the tax treatment for payments made under the resale royalty right for visual artists scheme. It ensures that the resale royalty collecting society, which will be established by this scheme, will not be taxed for royalties it collects on behalf of the artist. Instead, the artist would include any royalty payment in their assessable tax income, thus making Mr Swan happy.

This process mirrors the system in place for copyright payments. Without these amendments, payments handled by the resale royalty collecting society would be subject to complex trust taxation rules. However, this would impact artists as they would become liable for tax on their royalties in the income year they became entitled to them rather than when they actually received the payment. Obviously there can be some delay between those events. The bill also amends the wording of the provisions dealing with the treatment of copyright income to reduce the complexity of the tax law. So it is not legislation that will make the tax lawyers happy, but thankfully they are a small minority.

The resale royalty right for visual artists scheme will ensure that money is directed back to the emerging artists, creating a new way for them to earn income and providing greater incentive for them to stick with their profession. Hopefully, it will mean that some of them will not have to give up their day job and that they will persevere and turn into great artists. Obviously, a lot of people out there in the suburbs are hoping to break into the art world, so hopefully this will give them a little income stream and make them persevere. This bill ensures that the scheme will be complemented by sensible and practical tax laws. I commend the minister for this legislation and I commend the bill to the House.

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