Chris Ellison (WA, Liberal Party, Minister for Human Services) Share this | Hansard source

Firstly, I will briefly say that the government opposed this amendment in the other place. This is the same amendment being put in the Senate, and the government similarly opposes it in the Senate.

For the record, I will point out that the $250 million divestment requirement is reasonable because the government is introducing generous tax concessions for early stage vehicles. Given the emphasis on start-up and seed capital, the need for ongoing tax concessions once an entity reaches a size of $250 million diminishes. Moreover, if the partnership divests the entity into a venture capital limited partnership as it approaches the $250 million limit, it can continue to attract tax-free gains without any divestment requirement. The requirement to divest once an entity reaches $250 million applies for up to six months after the end of an income year. This provides ample opportunity for divestment to occur. I certainly commend the bill to the Senate and I thank senators for their contribution.

There are a number of schedules to this bill which deal with important issues and they have been touched on by senators. Schedule 1 to this bill makes amendments to the capital allowance system. Schedule 2 implements the government’s decision to allow taxpayers to deduct boating expenses up to the amount of boating income earned. This is very relevant when one considers the increased tourism in this country with people leasing out vessels for visitors overseas in particular. Schedule 3 to this bill improves the operation of the research and development—or R&D—tax offset. Schedules 4 to 7 demonstrate the government’s support for philanthropic activities in the community. Schedule 4, for instance, extends the gift provisions to allow taxpayers to claim a tax deduction for the donation of certain publicly listed shares to deductible gift recipients.

Schedule 5 has two aspects to it which I have been closely involved in. It amends the list of deductible gift recipients in the tax legislation to extend the current listing for the Finding Sydney Foundation and to list the American-Australian Association Limited and the Bunbury Diocese Cathedral Rebuilding Fund. I have had an active involvement in the Finding Sydney Foundation, one which is endeavouring to mount a search to find the Sydney, which was tragically lost off the coast of Western Australia. That is a very important endeavour and one which I think all Australians would support. This will assist that foundation in its work.

The Bunbury Diocese Cathedral Rebuilding Fund was set up as a result of the Catholic Cathedral in Bunbury being destroyed, somewhat ironically, by an act of God. It was a storm that went through which caused the cathedral to be demolished. It was tragic for the people of Bunbury and the south-west, and the government provided $5 million towards the rebuilding of the cathedral. That is something which I have had an involvement in and fully support.

Schedule 6 to this bill extends the eligibility for tax deductions for contributions to deductible gift recipients where an associated minor benefit is received at an eligible fundraising event. Schedule 7 to this bill makes technical amendments to ensure that the definition of ‘exempt entity’ covers all entities exempt under the income tax law. Schedule 8 demonstrates the government’s commitment to new business ventures and the promotion of industry innovation. That amends the venture capital regime to relax the eligibility requirements for foreign residents investing in venture capital limited partnerships and Australian venture capital funds.

So there are a number of important initiatives in this bill. I thank senators again for their contributions to the debate and I commend the bill to the Senate.