Julie Owens (Parramatta, Australian Labor Party) Share this | Hansard source

Can I also join the previous speaker and make my comments about the Boer War Memorial. In my electorate, I have the Lancer Barracks. The Lancers are the oldest and most decorated unit in the Australian military. They, of course, were a cavalry regiment in the Boer War and are very strong advocates for the Boer War Memorial, as am I.

I am speaking once again on one of the TLAB bills, in this case the Tax and Superannuation Laws Amendment (2013 Measures No. 2) Bill 2013. I think I have said in this house a number of times how much I enjoy the TLABs. This one is actually a tax and superannuation law amendment bill, which is called a TSLAB, so we now have two versions of these bills that cover a range of things to do with tax laws.

I have been accused at various times of having a character flaw for enjoying speaking on TLABs and TSLABs, but for me they bring together in one bill a whole range of things that government is doing and indicate the complexity and sometimes the fine detail of work that goes on behind the scenes when you deliver a major policy. In some ways they follow along behind, clean up, fix and adjust things that change in major policy areas.

This bill has eight schedules. If you are a small business person, you earn less than $35,000 a year, you are in film or you like Australian film, this one has something for you. In fact, probably just about everybody in the country would find something in this bill that relates to them. I am going to mention briefly all of the schedules but I am going to concentrate on a couple of them more than others.

The first one is one that I am going to spend a little bit of time on. It amends the film tax offsets to restore the intended meaning of 'documentary' and clarifies that game shows are not eligible for tax offsets. Income tax law provides tax offsets to encourage expenditure on films in Australia if certain criteria are satisfied. The producer offset, for example, requires a minimum level of Australian expenditure. It varies for different genres, but the level required is lower than for documentaries, and this schedule is specifically about documentaries. Screen Australia is the film authority that administers the producer offset, which involves assessing whether or not a film satisfies the criteria set out in division 376.65 of the Income Tax Assessment Act 1997, and I will not repeat the name of that act. This includes determining whether a film is a documentary and calculating the amount of QAI, which is qualifying Australian production expenditure.

Documentaries are an evolving form. If you consider what you see on television at the moment, you see the growth of reality television and the new forms of game show. Over time, the new forms that emerge weave their way into other forms. In a very short period of time we have seen a rapid change in the ways that documentaries tell their stories. At the moment in the act there is not actually a definition of documentary so Screen Australia has been using the definition from the Australian Communication and Media Authority's guidelines in order to administer the producer offset when it comes to documentaries.

Not so long back, in 2011, a series was made called Lush House. It follows a householder management expert, Shannon Lush, working with a different family or household in each of 10 episodes to improve their household management. The program satisfied the conditions of 376.65 of the tax act for the offset but failed as far as Screen Australia was concerned in respect of the documentary requirement, based on ACMA's guidelines. So the producers of Lush House disagreed with the decision and went to the Administrative Appeals Tribunal. They ruled that there was no definition in the act. They used a different definition and ruled that Lush House was in fact a documentary.

I will say upfront that documentary is such an evolving form that no matter what definition you have producers are going to push against it and the form is going to push against it. It will continue to move very quickly in Australia and internationally. It is a highly competitive form, so being at the edge of it in terms of selling your work is incredibly important. But what schedule 1 does is reinstate the definition which Screen Australia was using by inserting that definition from the guidelines into the act. So it reinstates, if you like, the situation that was in place before Lush House went to the Administrative Review Tribunal. This is one of those decisions which will always be controversial in a highly emerging form. It is incredibly important that Screen Australia continues to liaise with the industry to make sure that the definitions that they are using continue to be responsive and interpreted within the rapidly emerging concept of what makes a documentary—but it is a particularly interesting schedule.

Schedule 2 exempts from income tax the disaster income recovery subsidy paid to individuals, small business persons and farmers who lost income as a result of ex-tropical cyclone Oswald and related flooding in Queensland. Every time the government provides disaster income recovery funding of one form or another in the community following any of the disasters we have had in recent decades, the tax law is amended to make sure that those recovery payments are not taxable. Schedule 2 makes sure that the disaster income recovery subsidy payments for Oswald and associated flooding in Queensland are tax-exempt.

Schedule 2 also exempts from income tax the exgratia payments equivalent to those payments for eligible New Zealand non-protected special category visa holders who were affected. It is a very complex language but basically it makes sure that New Zealanders who were affected by the disaster and who received the payments in Australia had the same tax treatment as Australians. You get used to this sort of language of TLABs and TSLABs. Ultimately underneath it there are some very common sense things. That one is simply making sure that payments that people receive to help them recover from a disaster are not taxed. It is a perfectly fine and logical schedule.

Schedule 3 relates to the GST instalments system. It amends the GST act to enable those small-business taxpayers who are paying their GST by instalments and who subsequently move into a net refund position can continue to pay their GST by instalments if they wish to do so. It provides certainty for those small business entities that use the GST instalment system and it ensures that as their business moves from doing well to doing less well they will be able to continue to use the instalment system they are familiar with. It is a logical change. It came about because a member of the public asked for it through the tax issues entry scheme, which allows the public to put forward suggestions for major policy changes. This is community consultation at the most grassroots level working. It is a very good change and has been quite welcomed by number of small businesses in my area.

Schedule 4 amends the Income Tax Assessment Act 1997 to include a few more organisations on the list of DGR's, deductible gift recipients, which allows tax deductibility for donations. Is that what it means?

An honourable member: Tax deductible.

I knew it was something like that. I knew what it did. The Conversation Trust is a charity that publishes analysis and commentary on current affairs from the university and research sector. It delivers directly to the public through its website, Twitter and Facebook. That one is backdated to 21 November 2012. The National Congress of Australia's First Peoples Ltd, which is a national representative organisation of Aboriginal and Torres Strait Islander peoples also goes on the list. The National Boer War Memorial Association goes on the list. The Anzac Centenary public fund, which collates donations to fund a range of Anzac Centenary initiatives and projects as agreed by government goes on the list. The Australian Peacekeeping Memorial Fund Project Inc., which seeks donations to build a memorial on Anzac Parade in Canberra to recognise the service of Australians who have served in peacekeeping missions goes on the list and is also backdated to 31 December 2012. Philanthropy Australia, which is the national membership body for the philanthropic sector primarily servicing Australia's philanthropic trusts and foundations also goes on the list. Almost every TLAB or TSLAB has a number of organisations of that quality and calibre added to the DGR list.

Schedule 5 relates to the merging of multiple accounts in a superannuation entity. Most people would know that the Labor government has engaged in a number of reforms designed to make superannuation more transparent and simpler to manage. We found ourselves in a position in this country of people having many superannuation accounts, sometimes being unaware that they do. As they moved from one employer to the other over the past decades it was sometimes easy for superannuation account to be left behind somewhere and for it to be eaten up in fees.

We have done a considerable amount of work through the lost super, MySuper and other reforms to reintroduce people to their lost accounts. This one deals with a particular set of circumstances where a person will have more than one account with the same superannuation entity. As of June last year there were almost 32 million superannuation accounts in Australia—that is almost three accounts for every worker. We all know that if an account sits there for a while it is possible for fees and insurance costs to start to eat up the account. So this one places a general duty upon superannuation trustees to identify members with multiple accounts within their fund on an annual basis and to consider whether it would be appropriate to merge them, having regard to the best interests of members. This will apply regardless of the balances of the accounts concerned.

There was considerable consultation in the early days of putting this policy together. A number of kinds of accounts have been exempted from this, but it is a very good measure that should result in a more rational approach to multiple accounts within superannuation entities. And I will point out that a number of the major entities have already begun the process of finding ways to join accounts where it seems clear that the person has two accounts either without their knowledge or because that is the way it happened at the time, without a conscious choice.

Schedule 6 deals with the superannuation co-contribution and, again, it is part of a larger reform. The federal government has introduced a new way to contribute to the superannuation savings of eligible low- and middle-income earners. It was announced in the 2010-11 budget and is called the low income super contribution. It provides a payment of up to $500, not indexed annually, into the superannuation accounts of low-income earners. By the way, the schedule I am talking about is not about the new contribution; it is about the old one, which I will get to in a moment. The purpose of this new one is to compensate low-income earners for the fact that when they contribute to their superannuation account they do not receive the same tax benefit as a person earning a higher income receives. Essentially, the payment of up to $500 compensates a low-income earner and gives them a reasonable tax advantage for putting money into super, which those on higher incomes get automatically.

Part of the change is that we are reducing the contributions that made through the Howard government's superannuation co-contribution, which was introduced in 2003. Under that scheme, individuals were matched at a 100 per cent—dollar for dollar—rate up to $1,000 for people with incomes up to $31,920. Unfortunately, only about one in five people who were eligible to claim that actually did. The views of the industry were quite clear in the submissions they made on this bill: they preferred the low-income superannuation contribution, which went to all low-income earners, rather than the co-contribution, which was only being claimed by one in five.

I am nearly out of time so I had better be very fast. Schedule 7 consolidates eight existing dependency tax offsets into a single streamlined offset and schedule 8 deals with the TOFA arrangements to clarify the operations, with lower compliance costs, and to provide additional certainty to affected taxpayers. So there are eight schedules—sorry I did not get enough time on 7 and 8—with very interesting amendments to tax law covering a broad range of areas. Again, there is something in there for everyone.

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