David Bradbury (Lindsay, Australian Labor Party, Assistant Treasurer ) Share this | Link to this | Hansard source

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I move:

That this bill be now read a second time.

The Income Tax (First Home Saver Accounts Misuse Tax) Amendment (DisabilityCare Australia) Bill 2013 is part of a package of measures increasing the Medicare levy by half a percentage point.

This bill contains consequential amendments to the Income Tax (First Home Saver Accounts Misuse Tax) Act 2008. These are necessary as a result of the increase in the Medicare levy, contained in the Medicare Levy Amendment (DisabilityCare Australia) Bill 2013.

Where a first home saver account holder improperly uses the account, the First Home Saver Accounts Misuse Tax applies to claw back the benefit they have obtained.

The rate of the misuse tax is currently 46.5 per cent, the top marginal rate of 45 per cent plus the current Medicare levy rate of 1.5 per cent.

The Income Tax (First Home Saver Accounts Misuse Tax) Amendment (DisabilityCare Australia) Bill will increase this rate from 1 July 2014 to 47 per cent, to reflect the increase in the Medicare levy from 1.5 per cent to two per cent.

These consequential amendments will help to ensure the integrity of the tax system.

The revenue from this package of bills will be used to provide a strong and stable funding stream for DisabilityCare Australia.

Further details of the bill are set out in the explanatory memorandum for the package of bills.

Debate adjourned.