Rex Patrick (SA, Centre Alliance) Share this | Hansard source

by leave—I move Centre Alliance amendments (1) and (2) on sheet 8974 together:

(1) Clause 2, page 2 (at the end of the table), add:

(2) Page 29 (after line 10), at the end of the Bill, add:

Schedule 7 — Financial report ing obligations for large proprietary companies

Part 1 — Repeal of instrument

ASIC Corporations (Exempt Proprietary Companies) Instrument 2015/840

1 The whole of the instrument

Repeal the instrument.

Part 2 — Grandfathered exemption

Corporations Act 2001

2 Subsection 1408(6) (table item 7)

Repeal the table item.

Part 3 — Application

3 Application

(1) This item applies to a company if, immediately before the commencement of this item, the company was exempted from complying with subsection 319(1) of the Corporations Act 2001 by the ASIC Corporations (Exempt Proprietary Companies ) Instrument 2015/840.

(2) Despite the amendments made by Parts 1 and 2, that exemption continues to apply to the company in relation to the 2019-20 financial year.

4 Instruments that provide relief from requirements of Corporations Act—Lodgment of annual reports by large proprietary companies

(1) Despite anything contained in the Corporations Act 2001, ASIC may not make a legislative instrument, however described, if that legislative instrument would have the effect of relieving the class of companies referred to in subitem (2) of the requirement to comply with subsection 319(1) of the Act for a financial year.

(2) The class of companies is the class of large proprietary companies that was relieved from the requirement to comply with subsection 319(1) of the Corporations Act 2001 due to the operation of the ASIC Corporations (Exempt Proprietary Companies) Instrument 2015/840 as in force immediately before the commencement of this Schedule.

For the benefit of the chamber: I am moving the same amendment that I moved for the Treasury Laws Amendment (2019 Measures No. 3) Bill 2019. This amendment seeks to remove from the statutes an exemption for 1,119 large proprietary companies from having to lodge an annual return with ASIC. That exemption creates a situation where there is scope for aggressive tax minimisation. That is what was presented to the Senate committee inquiring into corporate tax avoidance in the 44th and 45th parliaments. It also creates a situation where you have one class of companies and another class of companies. Any new company that comes along that meets the criteria for annual reports doesn't get an exemption. We can't have a situation where we have elite, wealthy business owners simply not having to lodge annual reports.

It's also important for anyone who wants to deal with a company to be able to go to ASIC and get access to reporting information to work out whether the company is solvent, what arrangements they have in respect of organisations and so forth. There is no justification for retaining this exemption. It was an exemption that was introduced back in 1995 as a temporary measure. Twenty-five years later it is still in the statutes. We know from the previous discussion on this last week that the government has no policy reason, other than it is still considering the 2015 report, for in fact not supporting this amendment. I will keep it brief: I will ask the minister whether or not he can present a policy reason for retaining this exemption.