Kevin Hogan (Page, National Party) Share this | Hansard source

These repeal day bills that we have been introducing are exceptionally important to our local economy and obviously to every small business person in this country. Everyone would remember that, in 2013, before the election, we made an election commitment to cut red tape costs by a billion dollars a year, to improve our competitiveness, create more jobs and lower households' costs.

This target has been well exceeded. We have announced more than $2.45 billion in regulatory savings in just over two years from the last election. While these figures can be lost in the big numbers, it has meant that on the ground we are helping small businesses—out there having a go and trying to make money by employing people and trying to create wealth for this country—keep their focus on what is important to them: their core business and making sure they are employing people and making money. Every small business that you walk into, Deputy Speaker Goodenough—and I know, with your background, you would know—in this country, across every sector, says, 'We have too many forms to fill out; we have too much red tape.' They spend a lot of time not focusing on their business. They are—literally—crossing t's and dotting i's.

With this repeal day legislation there are a lot of reforms. There are reforms with ASIC to facilitate business to take up digital disclosure, leading to annual savings of nearly $300 million, and the Australian Taxation Office upgrade of ATO online, providing access for businesses to manage their tax affairs in a digital environment. There are upgrades to the online portal, which is estimated to have an annual saving of over $100 million as well. For smaller businesses, changes to pay-as-you-go instalment entry thresholds remove an estimated 500 thousand small businesses from the system. This means that 45,000 small businesses that have no goods and services tax reporting requirements will no longer have to lodge the activity statement. The remaining 400,000 small businesses with modest or negative incomes that are still required to lodge business activity statements will no longer have to interact with the pay-as-you-go instalment system. This is going to save small businesses tens of millions of dollars each year in red tape. We have also expanded access to the Small Business Superannuation Clearing House, which means additional employers can now use this free service. This will save them time and reduce their paperwork. The reforms through the new franchising code will also deliver millions of dollars in red-tape savings across the sector.

We also have a $5.5 billion Growing Jobs and Small Business package in this year's budget. That will build upon these initiatives. The package allows for small businesses to immediately deduct every eligible asset costing less than $20,000 purchased between budget night and the end of June 2017. Many small businesses I have visited in my community have had a lot of people making capital purchases that would have been put off. It also includes lower taxes for small business. There has been a 1½ percentage point cut to the company tax rate for small companies and a five per cent tax discount for unincorporated entities. Providing small business with a reduced rate tax enables them to retain more earnings, which is important for their cash flow, their survival and the number of resources and money they have for employing more people.

This bill forms part of our commitment to repeal counterproductive and often redundant legislation. There are also amendments to the Superannuation Guarantee (Administration) Act to simplify this and makes the superannuation guarantee charge and penalty more proportionate to the noncompliance. There is also a tax imposed upon employers by the tax office when the employer does not meet their superannuation requirements on time. The guaranteed charge regime can be very punitive if they inadvertently make small mistakes, and this will be recognised.

The government is committed to employees receiving their superannuation so that Australians can save for their retirement. However, it is important to right-size the regulatory environment where appropriate. For example, this schedule will change how nominal interest is calculated. Currently, nominal interest is charged from the beginning of a superannuation guarantee quarter rather than from the due date of superannuation guarantee contributions, so employers have to effectively pay an additional four months of interest. This change will fix this problem by aligning nominal interest.

The second change this schedule makes to the guarantee is to align the penalties under the superannuation guarantee charge regime with the administrative penalties that exist under the Tax Administration Act 1953. This is all about simplifying penalties. The third change will align the earnings base for calculating the superannuation guarantee charge with the earnings base used to calculate the superannuation guarantee. Currently, these are different.

Schedule 2 will amend superannuation laws to enable the Australian Taxation Office to pay certain superannuation amounts, such as unclaimed super balances, directly to people with a terminal medical condition. It will also remove the requirement for superannuation funds to lodge a lost members statement with the Australian Taxation Office. The first change ensures that people who are dealing with the circumstances of being diagnosed as terminally ill or injured do not also have to deal with unnecessary complexity to get access to superannuation savings held by the ATO. Superannuation balances are, generally, able to be released tax free to people with a terminal medical condition. Super funds can already pay balances they hold directly to such people when a valid claim is made.

However, the existing law only permits the ATO to pay unclaimed super directly to terminally ill or injured people in limited circumstances. In most cases, when a terminally ill person makes a claim, currently, the ATO first has to transfer the money into an existing account in a super fund before they can access it. This creates unnecessary delays and paperwork for people who should be able to access their super. In fact, if the person does not have a super account, the red tape they face under existing law increases. For example, if a person on finding out they are terminally ill withdraws their balance and closes their super account, the person needs to create a new account just to receive their unclaimed super held by the ATO. We as a government do not want to subject people to needless bureaucracy, particularly when they are facing difficult life circumstances and are likely to be at their most vulnerable. Enacting this bill will allow the ATO to pay super amounts they hold or administer directly to a terminally ill or injured person. This will eliminate a pointless step in the claims process and provide people with faster access to their super when they need it most.

The Commissioner of Taxation also, in schedule 2, maintains a register known as the Lost Members Register, which contains details of members who have been reported by their super providers as lost. This register is maintained for the purpose of reuniting people with their lost super. The register is updated, periodically, using information reported to the ATO by super funds. This information is currently reported to the ATO by super funds, twice a year, through the lost members statement. This is a requirement under superannuation law. However, since 2013 similar information has also been reported by funds to the ATO as a result of a separate reporting obligation under tax administration law. This bill will remove the extra requirement for funds to lodge the lost member statement. It will remove an additional reporting burden for funds and reduce their compliance costs without reducing access to information as it will continue to be collected under tax administration law. People will continue to be able to use myGov to search the register for their lost super.

Schedule 3 to this bill contains amendments to the Corporations Act 2001 to modify the notification and reporting obligations applying to certain corporations that have property in receivership or property in respect of which a controller is acting. These amendments remove the unnecessary compliance costs, reputational damage and investor confusion caused by having to include 'in receivership' on all of a company's public documents, rather than only those documents that relate to the affected trust. The amendments will also reduce the administrative burden on corporations' officers by reducing the matters upon which they are required to report to a controller.

Schedule 4 to this bill repeals inoperative acts and provisions of the tax law. This includes: the repeal of the Commonwealth borrowing levy, which has been inoperative since 1997; the repeal of the tax-exempt infrastructure borrowing concession, which has been inoperative since 2012; and the repeal of various provisions relating to concessions for equity investments by financial institutions in small and medium enterprises, which have been effectively inoperative since 1999. I commend this bill to the House.

See this speech in context