Nick McKim (Tasmania, Australian Greens) Share this | Link to this | Hansard source

by leave—In my second reading contribution yesterday I said that we have some amendments to the bill, and I now move amendments (1) and (2) on sheet 1596 and amendments (1) and (2) on sheet 1597 together:

Sheet 1596

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

(2) Schedule 4, page 41 (after line 25), at the end of the Schedule, add:

Part 6 — Corporate tax transparency

Taxation Administration Act 1953

1 Subsection 3C(1)

Repeal the subsection, substitute:

(1) This section applies to an entity for an income year if:

(a) the entity is a corporate tax entity; and

(b) the entity has total income equal to or exceeding $100 million for the income year, according to information reported to the Commissioner in the entity's income tax return for the income year.

An expression used in this subsection that is also used in the Income Tax Assessment Act 1997 has the same meaning as in that Act.

2 Application of amendment

The amendment made by this Part applies in relation to an entity for the 2022-23 income year and each later income year.

Sheet 1597

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

(2) Schedule 4, page 41 (after line 25), at the end of the Schedule, add:

Part 7 — Financial reporting obligations

ASIC Corporations (Exempt Proprietary Companies) Instrument 2015/840

1 The whole of the instrument

Repeal the instrument.

Corporations Act 2001

2 Subsection 285(1) (table item 5)

Omit "Companies that have the benefit of the grandfathering in the relevant Part 10.1 transitionals do not have to lodge.".

3 Subsection 1408(6) (table item 7)

Repeal the item.

4 In the appropriate p osition in Chapter 10

Insert:

Part 10.63 — Application provisions relating to Part 7 of Schedule 4 to the Treasury Laws Amendment (2022 Measures No. 1) Act 2022

1693 Definitions

In this Part:

amending Part means Part 7 of Schedule 4 to the Treasury Laws Amendment (2022 Measures No. 1) Act 2022.

commencement day means the day the amending Part commences.

1693A Application provision

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

(2) Despite the repeals made by the amending Part, that exemption continues to apply to the company in relation to a financial year that ends before the commencement day.

1693B Instruments that provide relief from requirements of this Act — Lodgement of annual reports by large p roprietary companies

(1) Despite anything contained in this Act, 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 subsection (2) of the requirement to comply with subsection 319(1) of this 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 this Act by the ASIC Corporations (Exempt Proprietary Companies) Instrument 2015/840 as in force immediately before the commencement day.

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

The government will be supporting the amendments. The amendments represent longstanding Labor policy and we appreciate the Greens' assistance, and eagerness, in working with us on delivering our policy commitment to tax transparency.

The amendments remove grandfathering arrangements that exempt certain large proprietary companies from submitting audited annual reports to ASIC. There is no clear economic or policy reason for continuing this exemption. The amendments will remove the exemption, improving transparency and removing an information asymmetry between exempt proprietary companies and their competitors who were not grandfathered. Removal of this was recommended by the Senate Economics References Committee in 2015 and in subsequent reports in 2016 and 2018.

We believe there was no clear economic or policy reason for continuing this exemption in 2015, when senators from the Greens political party, I'm advised, voted against the exact same amendments, as moved by Senator Ricky Muir. We appreciate that, in this case, the Greens have decided to change their position and vote in accordance with this amendment. The government, unlike our predecessors, will always stand up for greater transparency and accountability.

Nick McKim (Tasmania, Australian Greens) Share this | Link to this | Hansard source

I will just acknowledge the government's response to the Greens amendments and thank Senator Gallagher and the government for accepting the Greens amendments. I hope that we can work constructively into the future to improve corporate transparency and even corporate tax arrangements.

Dean Smith (WA, Liberal Party, Shadow Assistant Minister for Competition, Charities and Treasury) Share this | Link to this | Hansard source

H () (): In regard to Senator McKim's amendments on sheets 1596 and 1597, the opposition won't be supporting these amendments. Specifically, in regard to the amendments on 1596, as I said, the opposition will not be supporting the Greens amendments. The effect of these amendments is to increase red tape on Australian owned companies. By lowering the thresholds, these amendments will equalise the reporting obligations of foreign owned entities and Australian owned entities. The opposition supports reducing red tape and the regulatory burden on Australian companies to support a prosperous and productive economy. For these reasons, as I said, the opposition opposes those amendments.

In regard to the amendments on sheet 1597, again, the opposition will not be supporting the Greens amendments. The effect of these amendments is to increase the red tape and compliance burden in the economy. It further removes regulatory certainty for a limited class of companies and constrains the ability of ASIC to make instruments to implement its regulatory decisions. The opposition supports reducing red tape and the regulatory burden on Australian companies to support a prosperous and productive Australian economy. Again, for these reasons, the opposition will oppose the amendments on sheet 1597.

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

I didn't speak to the amendments on sheet 1596, because I understand they have been moved together, but I would just put on the record that the government will also support the amendments on sheet 1596. The amendments align with the government's multinational tax transparency election commitments. Transparency is a key factor underpinning the integrity of the tax system. These amendments are a targeted and balanced tax transparency initiative and will provide enhanced public scrutiny on corporate information, which will help to change how corporates view their tax obligations.

I would also just say, in conclusion, that it would be remiss of me not to acknowledge former senator Rex Patrick and his support for amendments like this; in fact, I think he moved them to every Treasury law amendment bill under the previous government! So I'm sure that he will be very pleased to see this amendment pass, and I acknowledge the efforts he took to try and put these arrangements in place.

Claire Chandler (Tasmania, Liberal Party, Shadow Assistant Minister for Foreign Affairs) Share this | Link to this | Hansard source

The question is that the amendments moved by Senator McKim on sheets 1596 and 1597 be agreed to.

Claire Chandler (Tasmania, Liberal Party, Shadow Assistant Minister for Foreign Affairs) Share this | Link to this | Hansard source

We have one remaining amendment from Senator Roberts.

Malcolm Roberts (Queensland, Pauline Hanson's One Nation Party) Share this | Link to this | Hansard source

by leave—I withdraw my amendment because it's essentially the same as the Greens, based on Senator Rex Patrick's and the Greens' work.

Bill, as amended, agreed to.

Bill reported with amendments; report adopted.