Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Government in the Senate) Share this | Hansard source

No. We have already had an extension. I am not saying the debate is ending. We do not end until the committee stage is finished, but we finish at 20 to two, so I thought I might respond to some of the points before then. Senator Joyce, Senator Heffernan and Senator Milne asked some questions. I do not quite have them in that order but here are some answers.

The company would get a deduction for establishment costs only, which does not include the cost of the land. I think Senator Boswell asked an important question. It is only the planting of the trees and the establishment costs, not the land. So it is highly unlikely that anyone would want to spend a billion dollars on a carbon sink forest because they would be spending it only on that aspect, not the purchasing of the land, which I think Senator Boswell indicated was an important part of it.

Senator Heffernan, this bill deals with establishment expenditure. Issues about contracts, treatment of credits et cetera are not within the scope of this bill. There are already tax laws, rulings et cetera that deal with these issues. Furthermore, the framework for offsets will be appropriately dealt with under the ETS. It should not be included in the tax law. I did mention, and it has come up a couple of times, that there will be a green paper on the ETS, which will set out a range of options. That would be the appropriate place to have this debate. I highlight 8.9 on page 52 of the bill which states:

The primary and principal purpose of establishing the trees must be for carbon sequestration and cannot include the purposes of felling the trees or using them in commercial horticulture. This deduction will only apply to those taxpayers who establish trees as part of a carbon sink forest.