Angus Taylor (Hume, Liberal Party, Shadow Treasurer) Share this | Link to this | Hansard source

I rise to speak on the Treasury Laws Amendment (2022 Measures No. 4) Bill 2022. This is a bill that, like so much of what we're seeing now, does look familiar, and that is a good thing—from tax incentives to support the digital economy to reducing red tape for large and small businesses, improving integrity around superannuation, supporting small and medium-sized businesses to digitise and train their staff. The majority of the content of the bill—and, I stress, the majority—contains that pro-growth, pro-small to medium-sized business agenda that typifies our approach to the economy, and we very strongly support it.

I join with the Assistant Treasurer in his comments about the consumer data right and comments we just heard on the previous bill. These are good measures. These are pro-growth measures. These are measures that we can work with the government on. They are going to strengthen the economy, strengthen the power of consumers to be the best regulators in that economy. This is exactly the sort of initiative we do want to see from this government, and when we see it we will absolutely support it. We'd like to see more of it, not less. However, I have to say that, at the same time, we have seen disappointing initiatives from this government in this area of growing the economy, strengthening small to medium-size businesses and strengthening Australia in the process. We have seen tens of millions to the Public Service—money that we don't think is appropriate for up to 20,000 new public servants—and $6.1 million in grants to the CFMMEU to audit our textile industry. I really don't think the CFMMEU has any qualifications to audit our wonderful textile industry and the enormously important role that it plays, which my family has been involved with for many generations. This is one for the CFMMEU. There is tens of millions to develop and enforce workplace laws that will mean that any small to medium-size business above 20 employees will be subject to industrywide bargaining and strikes. That's not what we need.

We very much support initiatives such as the Digital Games Tax Offset, the Technology Investment Boost, the Skills and Training Boost and the initiatives to reduce red tape. We do have deep reservations about other parts of this bill.

It's important to note that this bill could have sailed through this parliament with bipartisan support. Traditionally, that is what you would see with Treasury laws amendment bills. These bills are intended to be noncontroversial measures that are bundled together that both sides of this chamber can work together on and support in the way that I have described: with bipartisan spirit. Instead, at exactly the time when we should be delivering certainty to business, the government has stapled into this bill a number of politically contentious measures, and that is outside what we have normally seen in this place with these sorts of bills. It's created logistical challenges for the government, but that is as it should be if they are going to take this sort of approach.

There's billions in spending here for transmission projects that have not been recommended by AEMO, the energy market operator, and that means there's money there—a big slush fund—for projects about which we don't know whether they will deliver a cost benefit. We don't know whether they're going to be good for consumers. We don't know whether they're going to be good for local communities that the transmission lines go through. We don't know that they're going to bring down the price of electricity at exactly the time when we do need the sort of projects that AEMO in the past has recommended that will bring down the price of electricity and make consumers better off.

On top of the billions in spending for transmission projects, within this bill is a hidden billion-dollar fund for the Department of Climate Change, Energy and Water to circumvent the independent CEFC process. That's a process we always respected in government. I strongly supported the role of the CEFC in deploying technologies and getting emerging technologies out in the marketplace, making them bankable, ensuring that there was finance there at the very-high-risk part of technology development life cycle. That is a good thing for the CEFC to do. I strongly support that, and we strongly supported that as a government. To have a hidden billion-dollar fund which is circumventing those processes that we honoured is not the right way to go. On top of that, we see within this bill—which, again, as an omnibus bill would traditionally be noncontroversial—$500 million of coalition energy commitments that they previously opposed, which is pretty extraordinary in its own right.

Worse than that is that buried deep in schedule 8 is a change to remove the safeguards around spending through the Clean Energy Finance Corporation. This means in practice that Minister Bowen, the Minister for Climate Change and Energy, will be able to sneak in changes without consulting the parliament. That's what he wants to be able to do. Hidden in the explanatory memorandum is the revelation that the minister and the department will have this billion-dollar fund to fund whatever they want without being accountable to this place. Businesses will pay the price for this. At a time when businesses need certainty and when we want to see—and those opposite have consistently promised—transparent and accountable parliamentary processes, to sneak in a change like that and use the CFC in this way is extraordinarily disappointing. We will be watching very closely how this money is used. To the extent that we can get any sense of transparency through estimates and other processes we can use, we will be holding the government to account, if this bill is successful.

Whilst we don't want to delay, and we won't delay, the bill's passage through this House, we will use the Senate to scrutinise these extraordinary powers that the government is sneaking through. I say to the government: if, in the future, the government wants swift passage of these omnibus bills through this place, it must ensure that within those bills are non-controversial items, which are bipartisan and which we can work together on. There is no shortage of areas where we are prepared to do that. We are willing to do that and we are enthusiastic about doing that. Just hearing the Assistant Treasurer talking about the Consumer Data Right tells me that there is lots to work on together. That's where these sorts of bills have a role. But to insert controversial items in them—bury them deep in them—in an attempt to sneak them through is not something that is going to be helpful to anybody in the future.

With that, I move the amendment circulated in my name:

That all words after "That" be omitted with a view to substituting the following words:

"whilst not declining to give the bill a second reading, the House notes:

(1) the vast majority of the initiatives in this bill are Coalition policies that cut red tape, support small business, and drive productivity by supporting businesses and individuals to train, innovate, and create;

(2) the Government failed to deliver similar initiatives in their own Budget in October;

(3) the Government have found time to pursue a range of pet causes in their first six months of office instead of legislating these measures earlier;

(4) that at the same time the Government should be delivering certainty to businesses, the Government have stapled a number of politically contentious measures into Schedule 8 of this Bill including:

(a) transmission projects that have not been recommended by the energy operator;

(b) a hidden $1 billion fund for the Minister for Climate Change and Energy to circumvent the independent Clean Energy Finance Corporation process; and

(c) legislative changes that remove guardrails on spending through the Clean Energy Finance Corporation; and

(5) that despite six months in office, the Government have failed to unveil a plan to support capacity in our energy market and broken their election promise to bring down power prices".

Maria Vamvakinou (Calwell, Australian Labor Party) Share this | Link to this | Hansard source

Is the amendment seconded?

Andrew Wallace (Fisher, Liberal National Party) Share this | Link to this | Hansard source

I second the amendment and reserve my right to speak.

Matt Keogh (Burt, Australian Labor Party, Minister for Veterans’ Affairs) Share this | Link to this | Hansard source

Today I'm very proud to be speaking on this legislation, specifically schedule 9—taxation of military superannuation benefits: reversing the Douglas decision. The legislation will ensure that no veteran pays high income tax, following the Douglas decision of the full court of the Federal Court, which determined a different tax treatment for specific military invalidity pensions through superannuation schemes. This decision relates to some military invalidity pensions paid to veterans via the Commonwealth Superannuation Corporation—ComSuper.

While, in the most part, this decision has had a positive impact on payments for veterans, there are some who have been left worse off. The Douglas decision meant that military invalidity pensions that commenced on or after 20 September 2007 under the Defence Force Retirement and Death Benefits Scheme and the Military Superannuation and Benefits Scheme are to be taxed as superannuation lump sums rather than superannuation income stream benefits. This legislation today seeks to ensure that those individuals are not disadvantaged.

The Douglas decision, as currently enshrined in law, has potentially adverse income tax outcomes for some veterans receiving an invalidity pension and invalidity pay. As a result of the decision, the superannuation income stream withholding schedules no longer applied to affected veterans. I wish to emphasise that, while the Douglas decision provided a positive tax outcome for many affected veterans, it created adverse income taxation impacts for some veterans on a permanent basis. For others, even though they may not be worse off on an annual basis, they may find that they have more tax withheld on a fortnightly basis from their pension.

The decision may have flow-on impacts for other government entitlements as well, such as family tax benefit, childcare subsidy, private health insurance, rebate entitlements, child support assessments and HELP repayments. While the unintended consequences of the Douglas decision became apparent in mid-2021, the Commonwealth Superannuation Corporation applied and then paused the new withholding tax rates on a number of veterans. I can confirm that, in early 2022, ComSuper applied the new withholding tax rates to the remaining veterans. This has resulted in some veteran pensioners' fortnightly net payments being reduced.

The Albanese government is committed to ensuring veterans and their families receive the support they need and deserve. That begins with ensuring the unintended consequences of this decision are rectified, ensuring that no veteran is worse off. To counter the resulting adverse impacts of this change in the tax treatment of their superannuation benefit as a result of the Douglas decision, this schedule to the bill creates a non-refundable tax offset to ensure that these veterans will not pay any more income tax or Medicare levy on their superannuation lump sums than they would pay if these benefits were still treated in the previous way before the Douglas decision was handed down. We have consulted affected veterans as well as other key stakeholders and government departments in pulling this legislation together.

I do note that concerns have been raised in relation to the findings of the Royal Commission into the Defence and Veteran Suicide interim report, specifically the simplification and harmonising of legislation for veterans' entitlement. As the House well knows, the government has welcomed the interim report of the Royal Commission into Defence and Veteran Suicide and has responded to all 13 recommendations of that report. We are currently undertaking work on that simplification and harmonisation of veterans' entitlement legislation, as set out in recommendation 1.

This bill will maintain the benefits of the Douglas decision for invalidity benefits and super benefits for beneficiaries of invalidity pensions under the two military superannuation schemes, as mentioned before and after September 2007 and otherwise retrospectively and prospectively reverses the effect of the Douglas decision in relation to all other schemes consistent with the intent of current superannuation law. This legislation before us today reflects our commitment to ensure that veterans are not left worse off due to the Douglas decision and that veterans who have benefitted from this decision will continue to do so. This legislation will extend to the spouse and children pensions paid following the death of a veteran, on the Defence Force Retirement and Death Benefit Scheme or the Military Superannuation Benefit Scheme.

The Albanese government is committed to ensuring that no-one is held back and no-one is left behind. That is particularly important when speaking about our defence personnel and veteran community. We are committed to ensuring that veterans and their families receive the support they need but also that they frankly deserve, and I commend this bill to the House.

Paul Fletcher (Bradfield, Liberal Party, Shadow Minister for Government Services and the Digital Economy) Share this | Link to this | Hansard source

The Treasury Laws Amendment (2022 Measures No. 4) Bill 2022 contains schedules dealing with nine separate areas, and the majority of them give effect to policies committed to and decisions announced by the previous government, particularly in several recent budgets. I want to speak particularly about the digital games tax offset and the technology investment boost as two policies put into effect by the previous coalition government. The fact is that one of the KPIs, one of the key performance indicators, it would seem for ministers in the Albanese Labor government is the capacity to take credit in an entirely shameless way for decisions taken by and work done by the previous coalition government. There has been a lot of talk recently about how apparently prominent figures in the current government, such as the member for Watson and the member for Chifley, I think, have apparently been longstanding champions of the digital games tax offset. For years, apparently, they've been calling for it. That may be so; I don't know, I've not checked the record. I've never heard it, so it is possible they've called for it. But the simple fact is that they didn't deliver it. They did nothing to deliver it when Labor was last in government between 2007 and 2013—six years in which to implement and give effect to the digital games tax offset; six years but nothing. But now, apparently, the claims are made that they have been longstanding advocates for it, and this is the coming to fruition of a grand vision.

But in a rewriting of history, equal to that written about by George Orwell in Nineteen Eighty-Four, there is complete silence from ministers in the Albanese Labor government about the work actually done—the detailed substantive policy work actually done—by the previous Morrison coalition government to give effect to this outcome in terms of the digital games tax offset. In May 2021, the then Morrison government announced a $1.2 billion Digital Economy Strategy, with the aim of making Australia a leading digital economy and society by 2030. One of the key elements of that announcement was the digital games tax offset, and, as the communications minister at that time, I was very pleased to work extensively on this matter. The strategic thinking of the Morrison government was that Australia should have a much bigger share of the global market for digital games development, which is a $250 billion market.

I can say to you, Mr Deputy Speaker, from my work with my two research assistants on digital games, my 26-year-old stepson and my 14-year-old son, that when you look at the sophistication of many different digital games—Plants vs.Zombies is one that I spent a bit of time engaging inwith my 14-year-old son; it was a few years ago, and he's moved on beyond Plants vs. Zombies to Call of Duty and many others—these are very sophisticated, and there is huge take-up of digital games around the world.

Of course, many countries have a significant presence in the production and development of digital games. Both Britain and Canada have very significant domestic games development sectors. One of the ways those two countries have encouraged global digital games studios to either come to those countries or expand in those countries is through the use of tax offsets. So this is a well-known policy tool that is used in the digital games sector. Of course, it's also a policy tool used very extensively in the adjacent screen sector. Again, when the coalition was in government, we used this policy tool to give effect to a significant stimulation of Australia's screen sector by increasing from 20 per cent to 30 per cent the producer offset for productions for television. We had in mind particularly the extraordinary global opportunities when it comes to the streaming-video-on-demand sector.

So the point I make to the House is that the use of tax offsets is a well-known policy tool for sectors like screen production and digital games production, and the decision that the Morrison government took and announced in a previous budget to make available this digital games tax offset was a decision based upon a clear analysis of the global market opportunity for the Australian digital games sector and a clear analysis of the return—the benefit—that taxpayers would receive in exchange for making available this tax offset. This is what economists call tax expenditure, and it needs to be carefully considered. A dollar of taxpayers' money committed has the same economic impact whether it's an on-budget expenditure or a piece of tax expenditure. But we did go through that detailed policy work. We made that announcement in May 2021, and we then did the detailed policy work. Draft legislation was released prior to the May 2022 election, and there was a consultation period held between March and April this year.

I'm pleased to say the Australian digital games sector welcomed the measures that we announced our intention to legislate. I'm also pleased to say that, during the consultation process, there was some detailed work done on some further improvements and enhancements to the way the offset would work. In particular, the view was put by the industry that it's important that this offset is also available in respect of ongoing development work, known as live ops. Mr Deputy Speaker, as you'd be aware, that's the term used in the sector. So I'm pleased to say that the availability of this offset has been expanded to cover live ops.

The way the industry works is that a game is released and then it is further upgraded and developed, often in response to feedback from people who are playing the game. Games users are a very active and engaged community, and they provide their feedback very directly to games manufacturers. Australia does have a vibrant domestic games sector, and I had a chance to visit a number of digital games companies during my time as communications minister. The sector in 2021 generated revenue of around $226 million, and that was an increase of 22 per cent on 2020, but be in no doubt that the growth opportunity for the sector and therefore for Australia's economy is a very significant one.

I and the opposition certainly welcome the fact that the Albanese Labor government has eventually—in a disappointingly dilatory and leisurely fashion—got around to bringing forward this particular piece of legislation. All the work had been done for them; it was all bundled up and ready to go, and, six months later, they've yawned, rolled over, woken up and thought, 'Oh well, it might be a good idea to build on this outstanding policy work done by the previous government.' That's evidently the thought process that they've gone through, while, of course, being extremely careful to avoid providing any acknowledgement at all of the rigorous policy work done by the previous government. That's the way they roll. It's all about ignoring the work done by the previous government and taking credit for it. That's the house style and that's politics.

I'm going to rise above politics and say that this is a good outcome for the digital games sector. It's a good outcome for the Australian economy, and it reflects the detailed, sustained policy work done by the previous government. I was very pleased to have an involvement in that work in my previous portfolio, and I'm very pleased to maintain a continued involvement in these issues as shadow minister for the digital economy, a portfolio, I note, parenthetically, which does not appear in the Albanese Labor government's ministry list, which is a matter for regret, but, presumably, that's because they've received instructions from their union masters. I can only surmise that they don't like the idea of the digital economy.

I want to turn to one other schedule contained within this bill, which is the technology investment boost. Again, this was a measure committed to by the previous government—the coalition government—based upon the work we had done with a view to understanding policy levers that would incent businesses and the private sector to make appropriate investments in hardware and software, to allow businesses to better use digital tools and to operate more efficiently and productively, with a particular focus on small and medium businesses.

On our side of the House, we have an enthusiasm for measures which incent businesses to take business decisions which are in their own private interest but also produce a positive public policy outcome. We like to do that in a way which makes most effective use of taxpayers' funds. We don't like to establish large bureaucracies. We don't like to take the approach that the present government likes, which is to try to make as many decisions as possible in Canberra and to create giant funds which hand out money based upon decisions by government instrumentalities. That's not what we like to do. What we like to do is empower and incent private businesses to make decisions.

That's why we chose to use the policy tool of an additional tax deduction of 20 per cent of the cost of expenses and depreciating assets up to $100,000 of expenditure per year, available to small businesses with an annual turnover of less than $50 million. When you look at the range of eligible expenditure which can then attract this additional bonus 20 per cent tax deduction, it includes matters such as digital enabling items, computers, telecommunications hardware and equipment, software and internet costs, and the systems and services that form and facilitate the use of computer networks: digital media and marketing, and audiovisual content that can be created, accessed, stored or viewed on digital devices—including webpage design.

As we all know, there's been a huge boost in ecommerce as a result of the pandemic. Many businesses have expanded their ecommerce offerings. Many businesses that have previously been bricks and mortar only have now shifted to become clicks and mortar. That's to say they've got a digital delivery channel as well as a bricks-and-mortar channel, but we want to see more of it and we want to support businesses that are moving to respond to be the clear preferences of consumers to be able to purchase as much as they can online. Again, this is designed to give businesses an incentive. These are choices for businesses to make, because we believe that businesses, their owners and their managers know best about what their customers need. They know best about how to meet the market opportunities. We want to provide that support, encouragement and assistance.

We don't believe that Canberra knows best, and that is a difference between this side of the House and the Labor Party. You often hear people say today that there's no difference between the major parties. That's not right. We fundamentally believe in the importance of the private sector in generating prosperity and we fundamentally believe that business owners and managers know their market and know their customers much better than any bureaucrat or politician is going to. We want to provide that support, encouragement and incentive. One of the things we want to incentivise businesses to do is making as effective a use as possible of digital tools to serve their customers more efficiently, to streamline and automate business processes and to get their offering out into the marketplace so that customers and potential customers can see what kinds of products and services businesses have.

I add that we know that cybersecurity is a very significant issue. We've seen some troubling instances of data breaches. We know that small and medium businesses are concerned about this, and this, again, is a practical policy tool, because the 20 per cent bonus tax deduction is also available for cybersecurity systems for backup management and monitoring services to deal with cybersecurity issues.

It's a matter of regret that the current government has been rather leisurely in its approach to this. It's taken them quite a long time to bring this bill before the House, but I'm not going to take a political approach to this. I'm going to celebrate the fact that they finally got around to bringing this bill forward, and I do welcome what's contained in the two schedules I've discussed.

Henry Pike (Bowman, Liberal National Party) Share this | Link to this | Hansard source

I want to acknowledge the contribution made by the previous speaker on the elements of the bill related to the work that he undertook as our communications minister—and what a wonderful job he did in the former government in undertaking that portfolio. I acknowledge the sentiments he made just then and echo those. I'm going to take a different approach in relation to this bill.

The Treasury Laws Amendment (2022 Measures No. 4) Bill 2022 is effectively a nine-schedule omnibus bill. This bill is vast in scope and for the most part is supportive of key budget initiatives of the former coalition government. The member for Bradfield did mention some of those. To this extent the bill is good. I also note the member for Hume's contribution and his noting that these Treasury laws amendment bills are typically noncontroversial. They're typically things that are brought together under in one bill and are typically things that we can support in a bipartisan way. However, at a time when the government should be delivering certainty to business, the government has stapled a number of very politically contentious measures into this bill, including billions in spending for transmission projects that have not been recommended by the energy operator, a hidden $1 billion fund for the Department of Climate Change, Energy and Water to circumvent the independent CEFC process, legislative changes that remove safeguards from investment in the CEFC and $500 million for coalition energy commitments that the new government had previously opposed.

While I note that, of course I welcome it. In the spirit of bipartisanship, of course I'm going to welcome anything that the current government wishes to copy from the previous government. But here again today, contained in this bill, we find the Labor Party caught stapling a number of items that are going to be very politically contentious. I will have more to say on those as I work my way through these schedules.

In brief, the nine schedules cover the following. Schedule 1 allows for a digital games tax offset, as the previous member spoke to. Schedule 2 tightens the definition of 'digital currency' to exclude cryptocurrency. Schedule 3 reduces record keeping associated with fringe benefits tax compliance. Schedule 4 provides a skills and training boost. Schedule 5 provides a digital capability investment boost.

Schedule 6 acts on recommendations of the banking royal commission, extending and adapting financial reporting and auditing requirements. However, the Albanese government seeks to take advantage of this opportunity by diluting transparency measures to carve out itemised contributions to trade unions—just like the IR bill and NACC Bill, which have been through this chamber already. Unfortunately, the government can't help themselves when it comes to running a protection racket for those involved in the union movement.

Schedule 7 extends DGR status to a few organisations, a list which notably includes Australians for Indigenous Constitutional Recognition, despite the ACNC previously failing to grant that organisation status as a public benevolent institution. This was an item that was noticeable in the budget papers as well, and here we see Labor's thumb on the political scale once again. It's surreptitiously providing a tax concession to an organisation which will promote the government's preference in the upcoming Aboriginal and Torres Strait Islander Voice referendum. I note the Minister for Indigenous Australians claimed, just 24 hours ago, that the Australian government would not fund either the 'yes' or the 'no' case in this referendum, and I welcome that commitment from the minister. I was pleased to see that the government won't be using taxpayers' money to fund either side of the referendum argument. I know that it's been a longstanding convention that Commonwealth governments will be even-handed when it comes to referendums and will fund the case both for and against any given referendum question.

Given the government is now legislating to enshrine the Australians for Indigenous Constitutional Recognition as an entity that can get this DGR status, I can only assume that when another entity is potentially formed to coordinate, run and fund the 'no' case in this referendum the federal government will move legislation to enshrine that entity as a DGR-status organisation as well. I think that is only a fair, reasonable and balanced approach and, certainly, one that would be preferential to the approach taken previously, of using taxpayers' money to fund cases in a referendum question. I think that offering tax exemption status, or tax concessions, would be better for Australia's fiscal position. It would only be fair that the government take the same steps when an entity is formed that might be running the 'no' argument in that referendum.

Schedule 8 is the most contentious of all the schedules within this bill, both in terms of parliamentary process and in terms of funding good public policy. Schedule 8 effectively paves the way for Labor to enact their Rewiring the Nation proposal, a policy that anticipates a cost of $20 billion. I think $20 billion is a cost that will certainly blow out over time. Despite the huge cost—which will be, of course, all borrowed money—the proposal comes with a predictable Labor murkiness, because there is no mention of the projects that would benefit from this funding. The schedule also removes the requirement for government to legislate additional CFC funding. This would allow the government to routinely create additional accounts within the CFC via general appropriation acts. By doing so, this schedule effectively circumvents the appropriate oversight and parliamentary scrutiny of this new funding, and that's quite a substantial step. By the way, this is not contingent upon any meaningful expansion of the CFC's mandate.

Given Labor's fundamental deception on electricity prices, which we've tried to expose day after day in question time—and these will continue to go up; that's what Labor's budget says will happen and what we know will happen—the coalition will be looking to move amendments in the other place to amend schedule 8 in its current form.

This is the big nasty surprise in this bill that typically you wouldn't get in a Treasury law amendment bill. This is an $11.5 billion injection to the Clean Energy Finance Corporation to carpet the country in transmission lines. This will increase demand for material, staff and tradies across Australia at a time when inflation is already running hot. This is actually a time in the Australian economy when it wouldn't hurt for the Australian government to be pulling back on investment in big, major projects, because we know that they are driving up the cost of building anything else in this country. It's driving up inflation. We are getting warnings on this from business groups. I've been getting them from big economic commentators around the country.

Buried in schedule 8 is also a change to remove the safeguards around spending through the Clean Energy Finance Corporation. This will mean that the minister will be able to sneak in changes without consulting parliament. I think it's important that the parliament reflects on that change. This is taking away our ability to scrutinise these expenses. It's very much a retrograde step. Hidden in the explanatory memorandum is the revelation that the minister and his department will have a $1 billion fund in the department to fund whatever they want. Wouldn't it be fantastic if we all had a $1 billion fund to spend on exactly what we wanted without the scrutiny of parliament? I can imagine $1 billion would get a lot of things done in my electorate. I'm sure it would in all of ours.

Schedule 9 concludes the bill by confirming the tax treatment of certain military superannuation benefits following the Federal Court's gutless decision. This is certainly an element of the bill that the coalition strongly supports. I acknowledge the contribution from the previous government speaker on this. This is an important element of the bill. It's something that the coalition supports strongly. It's something that the federal government is taking the right action in addressing. I am pleased that we are going to be having this through this bill.

I just want to go back and dwell on schedule 1 a bit. This is the digital games tax offset. This is part of the digital economy strategy that the former coalition government announced back in May. It's a 30 per cent refundable tax offset for eligible businesses that spend a minimum of half a million dollars on qualifying for Australian development expenditure from 1 July 2022. In the Mid-Year Economic and Fiscal Outlook, the coalition provided an additional $19.6 million over the two years of 2023 and 2024 to expand the digital games tax offset to include ongoing development work, known as 'live ops'—that's the term they use—on digital games following their public release.

There is certainly an emerging games sector in Australia. It's something that I know a lot of younger people in my electorate partake of. I note the previous speaker's experience with his sons in playing these games. My children are too young to partake of these yet, but I'm looking forward to the day when they can show me around Call of Duty and all those sorts of things. The many exciting Australian games that have been developed will be unlocked by the funding that will be available through this tax offset.

This measure received widespread support from the Australian digital games industry when it was first announced by the coalition, and that support remains today as we seek to legislate that further through this Treasury laws amendment bill. The digital games sector, as I mentioned, is expanding rapidly. It was worth $240 billion globally in 2020, and that market is set to reach $294 billion by 2024. This sector has generated in Australia about $226.5 million of revenue, an increase of 22 per cent on 2020, and 83 per cent of the revenue is from overseas markets. So it's one of these great Australian success stories that go unsung too often. People are producing products in Australia that are going incredibly well. They've had 22 per cent growth since 2020. Any industry that has received 22 per cent growth during the period of pandemic that we have just experienced certainly should be a shining light for the Australian economy and should be one that the Australian government seeks to support through measures like this. This will certainly help Australia to become a global player in game development.

I'll briefly dwell on schedule 2 before I conclude. The schedule amends the A New Tax System (Goods and Services Tax) Act 1999 and the Income Tax Assessment Act 1997 to tighten the definition of digital currency to exclude cryptocurrency and assets that are not denominated in any country's currency or are not sanctioned digital currencies of Australian or foreign governments. This was very interesting, as I read into this one further. This measure closes a tax loophole opened after the government of El Salvador allowed bitcoin to be accepted as legal tender, back in June last year. I think many governments around the world were raising an eyebrow at El Salvador's approach to bitcoin, and I'm pleased that the federal government is taking action on that front.

To conclude: at a time when the government should be delivering certainty to business, the government has stapled a number of politically contentious measures into this bill. There's a lot in here that we support. There's a lot in here that the coalition government came up with, and certainly we applaud the fact that the new government has decided to take these things forward. But this is a time when business needs certainty, and unfortunately, with the two contentious schedules that I mentioned, the government is playing games. While we won't delay the bill's passage through this House, the coalition will be using the Senate to scrutinise these extraordinary powers that Labor are trying to sneak through.

(Quorum formed)

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

I'd like to thank all of those members who have contributed to the debate. It's an important debate, and there have been some very interesting contributions, which I shall come to in due course, and I'll address the second reading amendment, moved by the member for Hume.

Firstly, schedule 1 of the bill creates the digital games tax offset, the DGTO. For the first time, Australia will have a dedicated tax offset that supports a rapidly expanding digital games sector. The DGTO is a 30 per cent refundable tax offset for eligible companies that develop eligible games and spend a minimum of $500,000 on qualifying Australian development expenditure from 1 July this year. The DGTO will strengthen the Australian digital games industry, expand employment opportunities for digital and creative talent, enhance the industry's international competitiveness and make Australia attractive for foreign investment.

Schedule 2 to the bill amends the tax law to clarify that digital currencies continue to be excluded from being treated as foreign currency for Australian income tax purposes. This maintains the current tax treatment of bitcoin and other similar digital currencies. It's a clarification made necessary on the advice of the tax commissioner because of a decision of the government of El Salvador to recognise bitcoin as unrestricted legal tender. That decision of a foreign government introduces uncertainty about the status of bitcoin for the purposes of Australian taxation law. This provision will restore the status quo ante. The measure will apply to income years that include 1 July 2021 and subsequent income years.

Schedule 3 to the bill permits the Commissioner of Taxation to allow employers to rely on adequate alternative records rather than employee declarations and other prescribed records to finalise their fringe benefits tax returns. You can see from this and other measures in the bill why we describe this as a pro-business bill, but particularly a pro small-business bill. Schedule 4 and schedule 5 really make that clear. Schedule 4 to the bill introduces the Skills and Training Boost—a bonus of 20 per cent tax deduction until 30 June 2024, supporting small businesses to train and upskill their employees. Schedule 5 does a similar thing. It provides a similar benefit in relation to technology investment. It's the 20 per cent boost taxation deduction until 30 June 2023—again, supporting small business to adopt digital technologies.

Schedule 6 to the bill extends and adapts the financial reporting and auditing requirements of the Corporations Act 2001 to apply to registrable superannuation entities which will improve the quality, transparency and accessibility of financial reports for RSEs. This is a part of the government's superannuation transparency plan. It basically fixes the mess—the dog's breakfast that was left to us by the former government. They didn't have a requirement that RSEs file an annual report and lodge the annual report with ASIC. They had no agenda for transparency and for using the data collected by APRA to provide reports to members and, indeed, to members of the public and analysts about the performance of funds, including their expenditures, and they had a very confused arrangement in relation to annual member meeting notices that did just about everything except reliably inform members where and when their annual member meeting was. We're cleaning all this up, and schedule 6 is part of that program.

Schedule 7 to the bill amends the Income Tax Assessment Act 1997 to include on the list of deductible gift recipients the Australian Education Research Organisation Ltd, the Jewish Education Foundation Ltd, Melbourne Business School Ltd, Australians for Indigenous Constitution Recognition Ltd, Leaders Institute of South Australia Inc., and Saint Patrick's Cathedral Melbourne Restoration Fund. It does extend the current listings for the Sydney Chevra Kadisha and Australian Women Donors Network and removes the listing for the now defunct Mt Eliza Graduate School of Business and Government Ltd. The deductible gift recipient status allows members of the public to receive income tax deductions for the donations they make to those organisations. The government is supporting these organisations in the provision of valuable community services by granting them DGR status.

I'm going to say something about schedule 8 to the bill and use this as an opportunity to respond to some of the extraordinary, inaccurate and ill-informed claims that are made by way of a second-reading amendment in the name of the member for Hume. It seems to us that the crux of these amendments is to introduce a policy that the government campaigned on prior to the election, affirmed during the election campaign and announced on no less than a dozen occasions, including on budget night, that we'd proceed with. But for some reason the member for Hume seems to think they're hidden somewhere. Far from being hidden, we have contained on these provisions consistently for the last 12 months and will continue to do so. I can understand a former government that had 22 separate energy policies and never managed to land one of those energy policies—

Brendan O'Connor (Gorton, Australian Labor Party, Minister for Skills and Training) Share this | Link to this | Hansard source

How many?

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

Twenty-two. The members in the chamber seem surprised. Yes, I can confirm they had 22 separate energy policies but couldn't land one of them, and the person who was most responsible for destroying each and every one of those 22 energy policies was the member for Hume. We're not surprised that the person who put so much energy into destroying energy policies of his own party when they were in government has an aversion to energy policy, and it's not surprising to us that he wants to use this opportunity to destroy a 23rd energy policy, one that might just work. But all good members of this House, and that is the majority of members of this House, can see through it. Not satisfied with wrecking their own policy, he wants to do the same thing here. We are calling him out on it. It is time that we got energy policy back on track in this country. Under the watch of the member for Hume we saw, at his hand, four gigawatts of dispatchable energy leave the Australian east coast generation system. Only one gigawatt of energy returned to that system. Is there any wonder we are having problems with energy generation supply, and is there any wonder that power bills are going up in this country? It is the direct result of the policies championed by the member for Hume. He was at it for nine years when in government, and now he's at it again. He hasn't learned a thing.

We have a policy for dealing with every issue, and if I could sum our policy up, it is about ensuring that we have reliable, sustainable and affordable energy—the exact opposite to the policy direction of the former government. Yes, it's about Rewiring the Nation. Yes, it's about ensuring that we have more energy generation and that we are able to connect the place where the energy is being generated to the place where it's being used, by rebuilding the energy transmission system.

In the member for Hume's second-reading amendment he claims that this is a secret provision, and he raised in his speech on the second-reading amendment significant concerns about the projects that are going to be funded under the new funding arrangements. One of the issues he raised concerns about is the Marinus Link, the link that will connect the new Battery of the Nation project in Tasmania, generating new electricity capacity, from Tasmania to the mainland, providing a new source of energy and electricity generation, particularly for the east coast of Australia and for South Australia. You've got to ask yourself who could be against that. Who could be against a project that is going to connect a new source of generating clean energy in Tasmania across the Bass Strait and into the east coast energy generation market? Apparently the member for Hume, post election, is opposed to that project. Apparently, the member for Hume, after the election, has significant problems with the government implementing its election commitments to set up the Rewiring the Nation program and to ensure that we can invest in projects such as the Marinus Link. I say 'post election' because he had something to very different to say before the election. I'm reading from a press release, dated 3 April 2022, and published by no less than Angus Taylor MP, the member for Hume, wherein he boasts that a re-elected Morrison government will invest in none other than the Marinus Link Battery of the Nation program. The press release says the 'Marinus Link and Battery of the Nation are true nation building projects'. He waxes on over four complete pages to extol the virtues of the Marinus Link, and this is in his press release dated 3 April 2022. Apparently, post election, when this project has funding dedicated to it, and was facilitated by the bill before the House, it's somehow not only wrong but also secretive and something that he no longer supports. I invite the member for Hume to come back into the House and explain to the people here why he has had this about-face on this important project.

There's no about-face on our part. We have one policy, and that policy is to deliver cheaper, more sustainable, more reliable energy for the people of Australia, and far from playing politics on it and far from having 22 policies over nine years, we'll have one policy and we'll implement it. This bill before the House, particularly schedule 8, is a critical part of that.

In closing, I encourage members opposite, when they are asked to come in here and speak on a Treasury law amendment bill, and they are given a set of speaking notes from the shadow Treasurer, the member for Hume—when they are sent in here to read something that he's asked them to read, the default position is: just say no, because it's probably wrong. This is in black and white, in his second reading amendment to the bill before the House, which we will be opposing. If you want to protect your reputation and your standing in this place over many years, and if the member for Hume recommends that you come in here and say something, the default position is: just do the opposite. I commend the bill to the House.

Scott Buchholz (Wright, Liberal Party) Share this | Link to this | Hansard source

The original question was the bill be read a second time. To this the honourable member for Hume has moved as an amendment that all words after 'That' be omitted with a view to substituting other words. The immediate question is that the amendment be disagreed to.

Question agreed to.

Original question agreed to.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.