Joe Hockey (North Sydney, Liberal Party, Shadow Treasurer) Share this | Hansard source

It is rare for us to oppose a bill such as this, the Tax Laws Amendment (Countering Tax Avoidance and Multinational Profit Shifting) Bill 2013, because it is meant to be a matter that goes to the integrity of the tax system. However, if we were to be in a position where we could witness the dying days of the Whitlam government prior to its dismissal, but without the dismissal, then we would be witnessing it now because this government is lurching from announcement to announcement, completely disregarding process along the way. It is a real test for the Independents as to whether they are going to agree to a process where Australians face a more aggressive and empowered Taxation Office without having any public hearing into the Taxation Office or holding any public servant to account for the additional powers that are going to be given to them by this parliament. I find it extraordinary. I do not know what the government's motivation is—I seriously do not.

The House Standing Committee on Economics was not afforded the opportunity to have a public hearing into this legislation. The government used its own numbers on the committee, including the vote of the now independent member for Dobell, Mr Craig Thomson, to prevent a feasible hearing date from being set. I thought, when the deal was done between the Independents and the Labor Party, that we were going to have this grand era of transparency and accountability, that the sunshine was going to come in, so that everyone could see what was happening in the bowels of this chamber and in the bowels of this parliament. Yet the government—I suppose the Independents will vote with this; I would hope they do not, but I suppose they will—will try to roll this massive additional power for the tax office through the parliament without any scrutiny, treating the House of Representatives with utter contempt.

If the government and the Independents choose to do that, so be it. But, if there is a change of government, let's not have them come whingeing to us about the treatment they may get in the future or have them lecture us about how the parliament was treated in the past. I do not want to hear them whinge about it—because this will be one of the signature examples used. I am not really interested in the denial of democracy by the Labor Party, because it is a consistent theme, but denying a parliamentary committee from simply having a hearing on what was previously a noncontroversial bill makes it a controversial bill.

So the coalition are going to oppose this bill and we call on the Independents to join with us in opposing this bill until such time as this House has the opportunity to see whether there is justification for the Australian Taxation Office to have a massive increase in its powers and to see how the Australian Taxation Office justifies claiming that, with these additional powers, it will achieve a billion dollars of extra revenue. A billion dollars of extra revenue: that is what they are claiming. 'No problem. Give us these extra enormous powers and don't worry; we'll claim an extra billion dollars of revenue.'

With all the integrity measures over previous years, where did that revenue come from? You ask for a tightening up of this law, you ask for new prosecutorial powers, you ask for all this additional influence, so prove to us—whether it was under the Liberal Party or under Labor—that with the additional powers you actually did improve the integrity of the system and increase revenue.

Schedule 1 to the bill seeks to amend the general anti-avoidance provisions in the 1936 Income Tax Act—provisions that are commonly referred to as part IVA. Former Treasurer John Howard was responsible for inserting part IVA into the tax act. Part IVA applied to schemes that were entered into after 27 May 1981. When introducing part IVA, John Howard said:

The proposed provisions seek to give effect to a policy that such measures ought to strike down blatant, artificial or contrived arrangements, but not cast unnecessary inhibitions on normal commercial transactions by which taxpayers legitimately take advantage of opportunities available for the arrangement of their affairs.

In 2000, when introducing the GST, the coalition included division 165 in the legislation, a general anti-avoidance rule. Division 165 resembles part IVA in many aspects, although of course it is dealing with a transaction based tax, rather than a tax on a profit or income earned over a period.

We have consistently demonstrated that we are firmly opposed to tax avoidance behaviour. We firmly support the need for a strong set of provisions that deter abusive tax arrangements. The legislature—

Mr Bradbury interjecting—

If the Assistant Treasurer wants to intervene again, he can get up here and explain how his good mate Eddie Obeid got away with shuffling money between trusts. Is that what you want to do, keep interrupting me, Sunshine? We know how close you were to Eddie Obeid.

See this speech in context