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

I move:

That these bills be now read a second time.

I seek leave to have the second reading speeches incorporated in Hansard.

Leave granted.

The speeches read as follows—

TREASURY LAWS AMENDMENT (2022 MEASURES NO. 4) BILL 2022

This Bill delivers for the Australian people.

From enhancing a digital games industry to supporting our veterans, this Bill delivers.

From boosting small business to being a significant step in the Government's plan to reduce Australia's emissions, this Bill delivers.

I am also pleased to announce that the Albanese Government will overhaul transparency requirements for superannuation funds so that members can access clearer, more meaningful, and more consistent information about their fund.

The Government is committed to strengthening Australia's world-class superannuation system to maximise returns so that all Australians can retire with dignity.

A transparent system with consistently reported data is central to this outcome so that members have meaningful information to hold trustees to account and make accurate comparisons between funds on performance, fees and expenditure.

I want to take this opportunity to outline the Government's three part plan to deliver a genuinely transparent superannuation system that is member-centric

Today is part one, introducing legislation aligning super funds' financial and accounting reporting obligations with those on public companies. This includes filing annual, publicly-available financial reports with ASIC.

Part two is a new annual Superannuation Transparency Report to be delivered by APRA.

This will be a single source of granular, consistent information for members to compare performance and expenditure.

Part three is reforming existing rules so every reporting stream serves a distinct purpose, eliminating duplication and enhancing clarity: Annual Reports, APRA Transparency Reports, and annual member meetings—all aligned and ensuring members, regulators and the public have access to relevant information.

Our world-class $3.3 billion superannuation system is something every Australian should be proud of.

But we should always look for ways to strengthen it.

This Bill begins that process by embracing transparency and accountability.

Schedule 1 to the Bill establishes the Digital Games Tax Offset (DGTO). For the first time, Australia will have a dedicated tax offset that supports the emerging digital games sector.

The DGTO is a 30% refundable tax offset for eligible companies that develop eligible games and spend a minimum of $500,000 on qualifying Australian development expenditure from 1 July 2022. The new offset is estimated to increase payments by a total of $38.4 million over four years from 2021-22.

All entertainment and educational games are eligible for the DGTO, provided they can receive a classification rating from the Australian Classifications Board, are broadly available to the general public, and they do not involve gambling-like activities.

The DGTO will strengthen the Australian digital games industry, expand employment opportunities for digital and creative talent, enhance the industry's international competitiveness and make Australia more attractive for foreign investment.

Schedule 2 to the Bill amends the tax law to clarify that digital currencies (such as bitcoin) continue to be excluded from being treated as a foreign currency for Australian income tax purposes.

This legislation maintains the status quo. Clarification in the legislation is necessary following a decision by El Salvador to recognise bitcoin as unrestricted legal tender from 7 September 2021. This introduced uncertainty about the status of bitcoin and similar digital currencies for Australian income tax purposes which the legislation addresses

Schedule 3 to the Bill provides the Commissioner of Taxation with the power to allow employers to rely on existing corporate records, rather than employee declarations and other prescribed records, to finalise their fringe benefits tax (FBT) returns. This will reduce compliance costs for employers, while maintaining the integrity of the FBT system.

Schedule 4 to the Bill introduces the Skills and Training boost to support small businesses to train and upskill employees.

Small businesses with annual turnover less than $50 million will have access to a bonus 20% deduction for eligible expenditure on external training of employees. This measure is being legislated to build a better trained and more productive workforce, helping to address skills shortages. The Skills and Training boost will be available until 30 June 2024.

Schedule 5 to the Bill introduces the Technology investment boost to support small businesses to improve their digital capacity which will allow them to enhance productivity and business growth. Small businesses will have access to a bonus 20% tax deduction for eligible expenditure of up to $100,000 per income year to support their digital operations, until 30 June 2023.

Schedule 6 to the Bill extends and adapts financial reporting auditing requirements which apply to registrable superannuation entities (RSEs).

Australia's superannuation system manages over $3.3 trillion in retirement savings on behalf of around 16 million people. Given the superannuation system's size and compulsory nature, every Australian should expect the highest level of accountability and transparency from their superannuation fund. This measure seeks to ensure that the transparency, regulatory oversight and rigorous standards for the reporting of superannuation fund financial information meet these expectations.

The new financial reporting requirements require RSEs to lodge financial reports with ASIC, and that these are publicly available.

The new requirements will also impose stricter requirements for auditors of RSEs. This includes imposing additional reporting and independence obligations for audit firms and audit companies.

The Legislative and Governance Forum on Corporations was consulted in relation to the measure as required under the Corporations Agreement 2002.

Schedule 7 to the Bill amends the Income Tax Assessment Act 1997 to include Australian Education Research Organisation Limited, Jewish Education Foundation (Vic) Ltd, Melbourne Business School Limited, Australians for Indigenous Constitutional Recognition Ltd, Leaders Institute of South Australia Incorporated, and St Patrick's Cathedral Melbourne Restoration Fund, on the list of deductible gift recipients.

The Schedule extends the current listings for Sydney Chevra Kadisha and Australian Women Donors Network. It also removes the listing for Mt Eliza Graduate School of Business and Government Limited.

DGR status allows members of the public to receive income tax deductions for the gifts to the listed organisations.

Schedule 8 to the Bill makes amendments to the Clean Energy Finance Corporations Act 2012.

The Government's $20 billion Rewiring the Nation election commitment will modernise Australia's electricity grids, lower the cost of electricity bills for consumers, help manage the electricity system, and increase renewables in the grid.

This measure is a significant step in the Government's plan to reduce Australia's emissions by 43% on 2005 levels by 2030 and to net zero by 2050.

This will have the potential to accelerate Australia's transition to net zero emissions by 2050.

Schedule 9 to the Bill will ensure that veterans affected by the Full Federal Court decision in Commissioner of Taxation v Douglas will not face worse income tax outcomes as a result of the Court's decision. The legislation will preserve the preferable tax and outcomes for affected veterans as a result of the decision.

To do this, this measure introduces a new non-refundable tax offset for members of the Military Superannuation and Benefits (MSB) and Defence Force Retirement and Death Benefits (DFRDB) schemes that ensures that individuals who would face adverse tax outcomes as a result of the Court's decision will not pay higher taxes on their superannuation invalidity benefit. This offset will also apply to Spouse and Children's pensions paid to a spouse or child following the death of a member of a scheme affected by the Douglas decision.

This measure will also ensure that any benefits that the Douglas decision may apply to beyond the MSB and DFRDB benefits, will continue to be taxed as superannuation income streams, by amending the legislative definition of superannuation income streams. The measure also includes a transitional provision to ensure that certain non-military invalidity benefits that received lump sum status prior to the Douglas decision are not disturbed by this reversal, while the Government considers the appropriate future treatment of these pensions.

Full details of the measures are contained in the Explanatory Memorandum.

TREASURY LAWS AMENDMENT (2022 MEASURES NO. 5) BILL 2022

The Australian Government has set the goal of doubling philanthropy by 2030. We are committed to working collaboratively with donors and the charity sector to achieve this goal.

Deductible gift recipient status allows people to receive income tax deductions for gifts to those organisations. This is a mechanism to encourage philanthropy and to provide support to the not-for-profit sector.

Organisations can obtain deductible gift recipient status under the general categories set out in Division 30 of the Income Tax Assessment Act 1997 or by being specifically listed by name in that Division.

This Bill amends the Income Tax Assessment Act 1997 to include Australian Education Research Organisation Limited, Jewish Education Foundation (Vic) Ltd, Melbourne Business School Limited, Australians for Indigenous Constitutional Recognition Ltd, Leaders Institute of South Australia Incorporated, and St Patrick's Cathedral Melbourne Restoration Fund, on the list of deductible gift recipients.

The Bill extends the current listings for Sydney Chevra Kadisha and Australian Women Donors Network. It also removes the listing for Mt Eliza Graduate School of Business and Government Limited as it is no longer required.

Under the general categories in the tax law, the eight organisations contained in this Bill were not eligible to receive deductible gift recipient status. As such, the Bill will amend the tax law to specifically list them by name. This supports these organisations by encouraging more Australians to support them.

Full details of the measures are contained in the Explanatory Memorandum.

Debate adjourned.

Ordered that further consideration of the second reading of these bills be adjourned to the first sitting day of the next period of sittings, in accordance with standing order 111.

Ordered that the bills be listed on the Notice Paper as separate orders of the day.