Ben Morton (Tangney, Liberal Party, Assistant Minister to the Prime Minister and Cabinet) Share this | Link to this | Hansard source

I move:

That the House insists on disagreeing to the amendments insisted on by the Senate.

Stephen Jones (Whitlam, Australian Labor Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

We disagree with the proposition put by the government. Quite simply, for the second time this week, the Senate has voted in favour of corporate transparency and, for the second time this week, the House of Representatives has been asked to concur. All Labor members of the House concur with the Senate. I understand that members of the crossbench also concur with the Senate, and so they should. It is important at any time that incorporated bodies have transparent reportage of financial arrangements. It is important at any time, but, in the midst of a financial crisis, with such economic uncertainty, it is more important than ever.

These provisions, when inserted in the act 25 years ago, were a part of a temporary and transitional arrangement. They were supposed to be reviewed. They were not. They were supposed to be transitioned to be removed out. They were not. They apply to in excess of 1,000 very large corporate organisations, some of the biggest private companies in the country. We say that we should be removing this anomaly which applies one set of rules to some private companies and a different set of rules to other private companies. It's an unlevel playing field that those members opposite should be supporting Labor in having removed.

When this matter was last before the House, there were three government members in the chamber. There was the member for Forde, a former financial planner. I fully expected him to jump and concur with Labor in defence of the financial planners, whose interests are being compromised by the fact that this bill is in deadlock, but there has not been a word from the member for Forde. There was the member for Goldstein, who finds it incredibly difficult to remain silent on any matter as soon as he's awake, but there has not been a word from the member from Goldstein. It fell to the assistant minister, the member for Petrie, to run the defence for the government. We were waiting with baited breath to hear what possible public interest reason the government could be advancing to have one set of rules apply to some corporate entities and another set of rules—a much more stringent set of reporting rules—to others.

Unable to articulate the public interest reasoning for having two sets of rules, he tabled a document. I've managed to obtain a copy of the document, and it reads as follows: 'The issue raised by this amendment is the subject of a recommendation in the Senate economic committee's report Corporate Tax Avoidance Part 1: You cannot tax what you cannot see. The reason we reject it is that the House will not pre-empt the government's response to this recommendation as a part of its response to the Senate economic committee's corporate tax avoidance report.' Members of the House might be interested to know when this report was tabled. Maybe it was last year. Maybe it was the year before. Maybe it was the year before that. No, it was August 2015. Students of this place know that's three prime ministers and three treasurers ago. We've been waiting a long time for this response. There can be no justification for further delay.

This amendment has been recommended by the corporate regulator, who has found as follows:

The lack of availability of public financial reports reduces transparency about possible indicators of tax avoidance or tax minimisation.

So, when we ask again, 'What possible reason could members opposite have for rejecting this amendment that's been put and rejected?' the only conclusion we can find is they are protecting their corporate mates and their corporate tax avoidance. There can be no other reason. Perhaps, as has been put elsewhere, there are large donors to the Liberal Party who find themselves on this list. I hope that is not the reason. I expect that the assistant minister at the table will leap to their defence and articulate a plausible public reason for why the rules should not be altered, and, if he's unable to do that, he should join with the crossbenchers and Labor and accept the message from the Senate. (Time expired)

Rebekha Sharkie (Mayo, Centre Alliance) Share this | Link to this | Hansard source

I will keep my comments very brief. I find it extraordinary that the government wants to send the message to the community that there should be one set of rules that apply to the super rich in Australia and another set of rules that apply to the rest of us. That is quite simply what this amendment seeks to do—to change what is currently existing so there's not one set of rules for the super rich and one for the rest of us. There is no public interest reason for the government not to support this amendment.

I think it's rather childish if the whole purpose of the government not supporting this amendment is simply because it isn't an idea of government. This place is supposed to be the contest of ideas. All good ideas should come up from this, and, if it's a good idea that the majority of the place supports, like what happened in the Senate, then the government should take that idea and champion it. But what's happened twice now is that, because the government have the majority numbers in this chamber, they have not supported a very sensible amendment simply because it's not their amendment. The Treasury Laws Amendment (2019 Measures No. 3) Bill 2019 is a good idea. We can't allow in Australia one set of rules for the rich and one for the rest of us.

I implore the government: don't allow this to be the hill that you want to die on—on this issue in Australia now. Our community wants transparency. They don't want to see the richest people in Australia getting to hide their information, particularly when ASIC has been very clear that it believes that this rule should be overturned. I would urge the government, in the strongest possible terms, to accept this amendment. This is a good amendment for Australia.

Daniel Mulino (Fraser, Australian Labor Party) Share this | Link to this | Hansard source

I rise to support the comments made by the shadow Assistant Treasurer and the member for Mayo in arguing against the motion that's just been put on the Treasury Laws Amendment (2019 Measures No. 3) Bill 2019. I'm going to begin my observations by misquoting Oscar Wilde and say that to reject a sound amendment once is unfortunate, but to reject it twice is careless.

We're finding ourselves here again, debating the most simple of propositions and we are going to see speaker after speaker raise very sensible public policy reasons why one of the foundational elements of the regulation of the financial sector—transparency—should be applied on a level playing field, and there will be not a word from those opposite—not a word. We've had what can only be described as a very lame document provided, as I think the shadow Treasurer may have said, in Marcel Marceau fashion. In the dead of night a document was passed across the chamber which said, 'We will get back to you on our reasons for rejecting this very sound amendment multiple times when we respond to a report that was lodged years ago.' This is government at glacier pace. This is not something that warrants multiple years of consideration.

Let's start with the basic proposition here—transparency. This is something I would hope people across the aisle could agree with: transparency is absolutely foundational to our regulation of the financial services sector. The royal commission highlighted this. The royal commission was something which we on this side had to drag those on the other side, kicking and screaming, into agreeing to. But, once it was established, it demonstrated with absolute crystal clarity why it is so important that we expose our financial services sector to transparency and why that transparency should be comprehensive and applied throughout on a level playing field. I'm on the House economics committee. Time and time again, we see the results of that royal commission played out and the damage that has been done to individuals throughout our society because organisations weren't held to account through transparent regimes.

As earlier speakers have noted, this is a measure brought in as a temporary measure a quarter of a century ago. So that's only a small amount of time longer than this government is taking to respond to a straightforward report that was tabled many years ago. It is nonsensical that this measure, this exemption, is not being removed when it has been subject to such a sensible amendment. This exemption creates a two-tiered system without any public policy rationale, and the two-tiered system means that some of our country's wealthiest individuals, through proprietary companies, are not having to report to ASIC in a way that other companies are. It's creating a two-tiered system with a completely arbitrary cut-off. Those companies that were on the list in 1995 don't have to report to ASIC; those after 1995 do. There is absolutely no public policy rationale for this distinction. In fact, it is such an absurd situation that even when companies want to remove themselves from the list, even when they don't want the exemption to apply to them, it's impossible for that to occur. Malcolm Turnbull tried to get his company removed from the exemption and that couldn't happen. That's one of the few actions he's taken in recent years that I support, but it was blocked by his own government.

In government, we proposed getting rid of this exemption for companies with turnovers of more than $100 million. The coalition overturned that change. That was on the basis, in part, of the fact that some proprietary companies could face kidnapping or commercial disadvantage. So again, as I mentioned yesterday, this is the absurdity of where we are at the moment. Those opposite, to the extent that they have laid out any policy rationale for this distinction, seem to imagine that kidnappers have some exhaustive record of ASIC records and when companies were formed or when they got different exemptions or not. This is a bizarre situation that has absolutely no justification on public policy grounds.

What we face here today is that the Senate is sending back a very sensible amendment which the Senate has passed twice now. It is an amendment that stands on its own merits, but it's also an amendment that aligns with broader objectives of transparency that should be more important than ever. As the shadow Assistant Treasurer said, at times like this, transparency is more important than ever, particularly after all that we've seen coming out of the royal commission. We should support this amendment.

Matt Keogh (Burt, Australian Labor Party, Shadow Minister for Defence Industry) Share this | Link to this | Hansard source

I invite members of the chamber to cast their minds back to history and to think about the chap Henry VIII of England, a former monarch, effectively, of this great land eventually. The things about those times were the issues that Henry was confronting. He had lords, earls and other noble people that he had to keep on his side because there were threats to the ongoing viability of his position as monarch. So Henry came up with the idea of the exchequer. It was a bit of a problem for some of these nobles. They didn't really want to be having to pay a lot of money to the king, and particularly to the exchequer, especially because Henry kept having wars. They were worried about the scrutiny that was being applied by Henry's central government, but they cut a bit of a deal. They decided that, if they could just make sure they didn't have to report on things so much to King Henry, it would make their lives a bit easier.

In the times that you would expect something like this to happen—in the Middle Ages of England—Henry drew up a list of some of his favourite barons. He said: 'If you're on my favourites list, you don't need to report on your financials to the exchequer. You don't need to tell my government what's going on. It'll be fine.' We might think: 'That's the Middle Ages. That sort of makes sense.' You might also think that that wouldn't be an arrangement that would last for terribly long, and it certainly wouldn't survive over multiple terms of parliaments and governments. But then we cast our way forward to 21st century Australia where we find that it has for reasons of transition, reasons of referral of power and reasons of old Corporations Law schemes—and, quite frankly, I will not bore this chamber with the history of the Corporations Law in this country in migrating from being a state based scheme to a national scheme, and you will all thank me for that! But somehow, in that process, we ended up with a list of private companies that were exempt from the application of law as it applied to everyone else.

A fundamental tenant of this nation and of liberal democracies generally is that the law applies equally to everyone. You don't create a law and then create a special little list of your mates who don't have to comply with the law, and you especially don't create that list and never update it. This is so perverse and odd that even a former Prime Minister who was on the list couldn't get off the list when he wanted to get off the list. There is really no defence available to this government to justify now why a list from 1995—25 years ago—still exists, can't be removed and can't be fixed. For some reason, in this little area of Corporations Law that most Australians have paid no attention to, the government wants to continue to run a protection racket for this list that was set in 1995.

Twenty-five years sounds like a long time ago. But to put that in a little bit of context—for the minister at the table, in particular—if only I had been able to incorporate a private company when I was in year 9, I might have had a chance of getting on that list. That's how long this has been around. Yet now—after reviews, after recommendations and after the corporate regulator said, 'Why don't we change this and get rid of this list?'—this government is continuing to try and maintain this arcane little exemption to the Corporations Law that has existed for 25 years. There is probably not one line in the Corporations Act now that is the same as what it was 25 years ago. This is a historical anachronism if there has ever been one when it comes to Corporations Law.

I spent time prosecuting the Corporations Law. I had to do it under two different criminal law regimes. The whole regime changed in that time, but somehow these companies kept their exemption from the application of the Corporations Law. It's ridiculous. There's no justification. There's no basis that you can have to explain why we should keep an exemption. You've got this little list of people who get to play the game differently. There's no justification in principle. There's no justification in law. There's no justification in a liberal democracy as to why you would keep this some 25 years later, even if there was at the time. For the government to now want to bounce this back up to the other place as if somehow their principled position is principled just goes down with every other principled position this government has ever had.

Andrew Leigh (Fenner, Australian Labor Party, Shadow Assistant Minister for Treasury) Share this | Link to this | Hansard source

I was just pausing for a moment to see if perhaps there was one member of the coalition who might defend their current position. I'm perfectly happy to yield to anyone on the other side who wants to defend the position that they are about to vote for. I think they're hoping that people will see the word 'tax' and just tune out. But let's be very clear about what we're debating in the House right now: the government want to throw an invisibility cloak over their mates so they can evade scrutiny. It is as simple as that. This is a measure that should have been a temporary exemption for a couple of years. That's what it was to have been when the Keating government put it in place in 1995. But it was the Howard government that said: 'You know, this is a pretty good lurk for some of our mates. Let's make it permanent.'

As previous speakers on this side—I don't need to say that; there have been no speakers on the other side—have noted, 1995 was a long time ago. The year 1995 was the era of Forrest Gump. It was when Oasis's 'Wonderwall' topped Triple J's Hottest 100 list. It was the era of Silverchair. It was a period in which most parliamentarians weren't on the internet and didn't have email. It was a very different era from today. Yet the coalition want to keep on rolling this little exemption forward, using excuses that become more and more spurious.

As I'm sure all of our parents mentioned at some point, if you don't have anything nice to say, just don't say anything. What those on the other side are doing is taking it to the next level: if you don't have a single decent defence, don't say anything at all; just stay really, really quiet and hope the Australian people don't see that you're voting for a cloak of invisibility for your mates. Those on the other side are welcome to jump up and defend it at any point, but they can't and they won't. They know it is as indefensible as their taking money from cigarette companies, as they did up until recently. They know it's as indefensible as their pledge to introduce a national integrity commission bill by the end of last year, which they squibbed on.

As the member for Whitlam has noted, their reason for voting against it is just laughable: 'The issue raised by this amendment is the subject of a recommendation in the Senate economics committee's report Corporate tax avoidance: Part 1You cannot tax what you cannot see.' As the member for Whitlam noted, it would've been helpful if they'd mentioned the year of that report. That is a 2015 report. The basis upon which they want to defend a 25-year-old exemption is a five-year-old Senate report that they haven't got around to responding to. So maybe, if we give them another 25 years, they'll respond to the Senate report, and maybe, another 25 years after that, they'll think about getting around to removing the exemption for their mates.

Let's remember who's hurt by this. The Australian taxpayer is hurt by this. Other competing businesses are hurt by this, because new businesses don't get the lurk. This is not just a grandfather provision; it's a great-grandfather provision, and it's disadvantaging the young start-up firms that have to report their dealings to ASIC, as they should.

The fact is that the government has not a single excuse for its current position. Saying it's in a 2015 Senate report that they'll get around to responding to is laughable. ASIC supports removing this exemption. Labor support removing this exemption. We voted for it in 2015 when Ricky Muir put it up, and the Liberals and the Greens voted it down. We voted for it in 2018 after the Greens backflipped and decided to put it up. We're voting again today to remove this exemption which should not have existed for more than a couple of years. It is absolutely indefensible that the government would continue to defend those 1,500 select few companies. It is the party not of the many but of the few. They're not the party for Middle Australia; they're the party for looking after their mates. They're not a party for transparency, because they don't have the guts to stand up here right now and defend their own position. Not one of them will step up and defend it, because they know it's indefensible.

Tony Smith (Speaker) Share this | Link to this | Hansard source

The question is that the House insist on disagreeing to the amendments insisted on by the Senate.