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

The busiest time of the year in the lead-up to the end of the financial year, and some genius somewhere who is probably the same person who gave advice on the rest of the bill has said, 'Let's get on with it and give them four weeks notice.'

We have said this is a joke. The government proposes that a tax or financial advice service consists of two elements: the provision of tax agent service and the provision of a service in the course of giving advice that is of a kind usually given by a financial services licensee or representative. Seriously—these are new definitions. These are new rules with less than four weeks to go. People out there are trying to earn a buck, and you are changing the regulatory regime. The government has sat on its hands for three years on this and now it is doing it with less than four weeks to go—and, by the way, it is meant to go through the Senate in two weeks. It is not just going through this place; it actually has to go through the Senate in three weeks. The Senate only sits for two weeks, and Lord knows how many bills the Senate has itself.

The government are recklessly exposing all the financial advisers to the risk of being noncompliant with the relevant laws from 1 July 2013. There is no practical way for them to achieve compliance within the short time frame left before these schedules become applicable law. It is just impossible. It could change in the Senate in three weeks time. Then it has to be gazetted. So they are saying to the financial services industry, which as a percentage of GDP is the second largest in Australia after health and around 10 per cent of the economy, 'Guys, we're giving you less than a week for a new regulatory regime.' The Labor Party wonder why there is chaos. Here—look at this bill. They are wondering why consumer sentiment is poor. They are wondering why business confidence is poor. They are creating a new regulatory regime for a large part of the Australian economy, and they are giving them a week's notice at the busiest time of the year.

The Financial Planning Association, the Financial Services Council and the Association of Financial Advisers have all pleaded that they get time to assess this bill. This relates not only to the consultation process but to definitions in the act. It is unclear, for example, if stockbrokers, insurance brokers and mortgage brokers are covered. They are pleading for time to look at potential negative interactions and inconsistencies with the government's own bungled FoFA changes, which also come into effect on 1 July 2013. They are trying to work out any increases in compliance costs resulting from the changes and what the consumer benefit of these changes is. These poor buggers have a new pricing regime for their business that they build into for their accounts. They are trying to work out what the costs are for consumers and what the cost of this massive new compliance regime is to their business. I do not think that is unreasonable. Surely the Treasury gave advice that this is a mess. I just cannot believe it. I do not think any department could be so removed from the community that it is there to serve that it would suggest that this is going to work in a week's process. This is ridiculous. We are going to try to excise it. This is ridiculous. It has to be put off.

Schedule 5 we are, again, going to seek to excise. We have deep concerns about this. The first of these measures requires the commissioner to publish particular information obtained from tax returns of those corporate tax entities which have a total income of $100 million or more for an income year. What the Commissioner of Taxation is going to do—and this is the first time this has happened—is publish individual companies' tax. He will also have a duty to publish the final annual amount of an entity's minerals resource rent tax—we know that is not that much—or the petroleum resource rent tax payable as reported by the entity regardless of the total income.

I introduced a private member's bill on 18 March this year to amend the Taxation Administration Act to remove any doubt that taxation officers may disclose to the minister information about instalments in the MRRT. We had high farce. We had the government saying it was not able to give the Australian people an update on how much the mining tax was collecting because that might disclose individual companies. How that works I do not know, because it is a tax on an industry and even we assume that there might be more than one taxpayer. But, even if there were one taxpayer, so what? It would not be disclosed. No-one would know who it was. We just asked that there be information made available, as there is for capital gains tax, income tax and every other tax. We just asked that there be updates available on the amount of revenue being collected under a particular tax headline.

The government said they could not do it, so I introduced my private member's bill to say, 'Well, sure you can.' The government were so opposed to what we were trying to do that they do not want to just list the amount of revenue raised from the mining tax; they want to disclose who is paying it. They want to tell you the names of the companies. Again, this is exactly the same old story. What consistent principles do the government hold? What do the government actually believe in that can be considered the same today as it was yesterday? Is there any consistent bone in the aggregate of bones over there?

We support the publication of aggregate tax information, unless that information can be reasonably attributed to a single person. But the government has gone one step further and said, 'No, we think individual companies should have their tax disclosed. Okay—a number of companies already disclose the amount of tax they pay in their annual returns. But what does this mean for Australia? I think that is a question this government does not ask itself often enough.

Ernst and Young, one of the largest global accounting firms, said:

… it is premature for Australia as a small open economy to engage in this public disclosure proposal unless and until public disclosure of corporate tax is identified by a majority of the G20, G8, OECD stakeholders or countries in the Asia Pacific region … it represents a distraction from the much bigger task of adjusting the system for taxation of international business.

The only country in the OECD that requires disclosure of tax from large companies, including foreign companies, is Denmark. Denmark is not really in competition with us. When I think of the competition Australia faces in taxation, trade, resources and investment, I do not automatically think of Denmark.

So what is the implication of this? Australia should not make the mistake identified by the United Kingdom Secretary of State for Business, Innovation and Skills, who was recently quoted as saying:

There is mounting concern about where tax is actually paid … The danger at the moment is that this just spills over into a generalised anti-business, anti-multinational sentiment which is unhelpful because we do want successful businesses, we do want inward investment. We don't want people to be stigmatised on the basis of ad hoc little bits of research.

I understand where he is coming from. I have no problems with disclosure, and I certainly want companies that earn money in Australia to pay tax in Australia. But I am not sure that these things are being redressed. Again, I think the risk of this schedule is that the government is like a bull at the gate. It is just going down the process of taking on business—a war with business. For all of its years it has been at war with business. After the first 12 months of the Rudd government, Labor has been at war with business. But the worst part is that it then introduces legislation that has unintended consequences and then cries crocodile tears when we have business sitting on its hands for new investment—or, worse, pulling out.

Schedule 6 of the bill amends the petroleum resource rent tax, and this builds on the calamity of the recent decision of the full Federal Court in the case of Esso Australia Resources. I would just say to you that we have tried to deal with a number of these issues previously. We are not going to stand in the way of these amendments. We do support the clarification contained in schedule 6 relating to the deduction of legitimate project expenditures. Schedule 7 is about removing the CGT discount for foreign individuals. We will allow the passage of the measure, particularly given the budget emergency which clearly exists under Labor. We support the amendments in schedule 8. Schedule 9 is on the GST-free treatment of National Disability Insurance Scheme funded supports; we support that. We are prepared to support updating the list of deductible gift recipients. In schedule 11 there are a number of miscellaneous amendments to the tax and super laws as the government claims, removing some anomalies.

Finally, I just say again that this bill is an absolute calamity in terms of its aggregate impact. It just represents in so many ways the chaos of the government. So, whilst we recognise that revenue needs to be raised, we also will move amendments to make sure that it is properly dealt with by this parliament in a respectful way.

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