Fiona Nash (NSW, National Party, Assistant Minister for Health) Share this | Hansard source

I would like to thank those senators who have contributed to this debate. The Tax and Superannuation Laws Amendment (2015 Measures No. 3) Bill 2015 represents another chapter in the government's commitment to implement our Economic Action Strategy and to repair the budget.

Our Economic Action Strategy is about setting Australia up for the future. It is about making some tough decisions now so that we can build long-term prosperity, so that we can make sure Australia has a social safety net which is strong and sustainable and so that future governments have the resources available to allow them to make decisions that are decent to and compassionate towards the Australian people. We have outlined a way forward to achieve this goal. This includes reprioritising government spending, to spend less on consumption now and more on investing in our future. It includes ensuring that taxpayers' funds are spent wisely. Taxpayers deserve value for money from the government. It also includes an expectation that everyone will contribute to budget repair. Both measures contained in this bill take us a step further on our path to achieving that goal.

Collectively, the measures in this bill will return around $826 million to the budget in fiscal balance terms over the forward estimates. Separately, both measures in this bill tell their own story about different groups of people. Schedule 1 abolishes the seafarer tax offset. This was a failed policy of the former government. It provided a refundable tax offset to eligible shipping companies for 30 per cent of salary, wages and allowances paid to Australian resident seafarers who were employed to undertake overseas voyages on qualifying vessels if the company employs the seafarer on such voyages for at least 91 days in the income year. The rationale for the introduction of the seafarer tax offset was to stimulate opportunities for Australian seafarers to be employed on overseas voyages and to gain maritime skills. The government is abolishing the seafarer tax offset because it is not achieving this policy intent. There are significant differences between Australian wages and conditions and those of some other countries. Accordingly, shipping companies that employ Australians for overseas voyages typically have other reasons for doing so, such as English language skills or knowledge of Australian ports. The seafarer tax offset has not led to any appreciable increase in the employment of Australian seafarers. Its repeal will return $16 million to the budget over the forward estimates.

Schedule 2 reduces the rate of the tax offsets available under the research and development tax incentive by 1½ percentage points for income years commencing on or after 1 July 2014. This was a difficult decision. However, repairing the budget must be done as fairly and equitably as possible. It is only fair that everyone makes a contribution. The changes to the R&D tax incentive are simple and straightforward. The changes will not affect the eligibility of companies for the incentive, the way that companies claim the incentive or the administration of the incentive more generally. The R&D tax incentive will continue to provide generous, easy-to-access support for thousands of eligible companies in all sectors of the Australian economy. This measure will provide a gain to revenue and savings of around $810 million over the forward estimates period. The measures contained in this bill represent a careful and reasonable approach to reprioritising government revenue. They bring us a step closer to reducing our debt and a step closer to a stronger, better and more compassionate Australia. I commend this bill to the Senate.

Debate adjourned.

Ordered that the resumption of the debate be made an order of the day for the next day of sitting.