Nick Sherry (Tasmania, Australian Labor Party, Assistant Treasurer) Share this | Hansard source

Firstly, I want to recognise the range of concerns that have been put forward by the Nationals, by the Greens and by Senator Xenophon on managed investment schemes. I want to recognise that there are valid debating points and valid policy points in everything you raise. Some I would agree with; some I would not agree with—but this bill is not the place to deal with those concerns.

I can confidently predict that at some point in time in the near future there will be legislation on managed investment schemes—whatever that final form is, I do not know yet—because of a couple of points Senator Milne raised in her contribution: the validity of the tax concession arrangements, the regulatory and supervisory arrangements, the impact on water and a whole range of other issues. The government at the present time has Minister Burke in respect to agriculture, Minister Wong in respect to water, myself in respect to tax concessions and Minister Bowen in respect to regulatory and supervisory issues on these things, all of which have been highlighted by the recent collapses of Great Southern, Timbercorp, and FEA in my own state of Tasmania. They are all being considered from a whole of government and whole of policy point of view. So there will be a time and a place for senators to put their concerns on that issue.

The issue we are dealing with here in this tax bill is a measure to protect 19,000 investors in forestry managed investment schemes from an unintended and adverse tax penalty, which is going to flow—unless this bill passes—as a result of the collapses. That is the issue we are dealing with in this bill. It is a measure about the deductions of investors in forest managed investment schemes. The deduction that they have been given and allowed could be denied because they have not held the investment for four years. They have not held the investment for four years because a number of schemes have collapsed for a whole range of reasons—not their fault—and these 19,000 investors could now be double penalised. They are penalised because they have lost their investment in whole or part and they are going to be double penalised, unless this amendment is passed, because of an adverse tax outcome.

That is what this bill is fixing: the adverse tax outcome and the double penalty that would apply to investors who have lost their money in whole or part. For goodness sake, my understanding of this amendment is that if an investor actually dies—obviously not their fault—they are tax penalised as well. We are clearing up a penalty that is totally unreasonable in the circumstances. That is what this bill goes to. I detect from the contributions in the chamber that whilst there is a whole range of concerns there is no opposition—in fact, I think there is resounding support for the particular measure we are taking to protect the 19,000 investors who, for reasons beyond their control, would be penalised unfairly. We are fixing that particular problem.

The amendment moved by the Australian Greens goes to the broader issue of the debate—repeal of the carbon sink forest provisions. I accept that the Greens have moved this on several occasions. I am very confident, Senator Milne, that there will be another occasion—and, I think, a more appropriate occasion—when we can deal with that and any of the other issues that have been raised in the debate. We oppose the amendment.