Sam Dastyari (NSW, Australian Labor Party) Share this | Link to this | Hansard source

What we are looking at in the Tax and Superannuation Laws Amendment (2015 Measures No. 5) Bill 2015 is a series of minor taxation amendments that are really designed to raise $1.4 billion over the forward estimates. This is an approach—and I think it shows a reasonable approach—between the government and the opposition who have been able to come together and work together on these tax measures and where there has been agreement and consensus. I think it is worth acknowledging the work of the shadow Assistant Treasurer, Andrew Leigh, in this space. I note that both the federal Treasurer and the federal Assistant Treasurer have played a very positive role in this space in allowing us to have this sensible debate.

Labor will always support sensible savings measures which improve the budget bottom line without harming vulnerable Australians. This is consistent with our sound, fiscal plan to bring the budget back into balance by delivering more savings spending over the coming decade. I do note, however, that, while there has been agreement in this space and while this is legislation that we will be supporting, it is disappointing that the government have failed to acknowledge Australia's revenue challenge. Since taking over the job, Treasurer 2.0, Scott Morrison, has continued to parrot his predecessor's line that Australia has a spending problem and not a revenue problem. Talking up spending is simply the government's way of preparing the ground for more cuts. The government believe that, if they keep talking about a spending problem, Australia might eventually get away with things like $100,000 degrees, cuts to the pension and cuts to family payments. The fact is that those on this side of the chamber believe that we have both a spending and a revenue problem, that both of these matters need to be tackled and that they need to be tackled sensibly if we are to address the revenue challenges facing this country.

Between 2014 and 2015 Australia's revenue projections were written down by $52 billion. That flows through every corner of the budget. Today, spending is at 26 per cent of GDP, but revenue has fallen to 23.5 per cent. As former Treasury secretary, Ken Henry, said:

… a bit more than half of it is explained by a deterioration in revenue performance; by the tax system not delivering in the way that the tax system has delivered in the past.

The International Monetary Fund agrees. In its most recent report on the Australian economy it noted, 'While expenditure reduction can and should play a role in reducing the fiscal deficit, there may be a limited scope for this avenue since expenditure is already relatively low compared to other advanced economies.'

This bill has four schedules. Schedule 1 simplifies the methods of calculating work related car expense deductions to ensure the tax act becomes more closely aligned with actual expenses incurred. Schedule 2 improves the integrity of the zone tax offsets by restricting access to individuals genuinely living in the designated regional and remote zones. Schedule 3 introduces a $5,000 cap on fringe benefits tax concessions on entertainment expenses for not-for-profit workers. Schedule 4 implements a technical integrity measure first proposed by the previous Labor government. Schedules 1 to 3 are essential savings measures and Labor has previously indicated its support for schedule 2. Schedule 3 is consistent with the recommendations from the Productivity Commission's Henry tax review and the final report of the Not-For-Profit Sector Tax Concession Working Group. Among those affected are employees of public benevolent institutions, hospitals and ambulance services. The proposed value of the cap is opposed by, among others, the Australian Medical Association, the Australian Salaried Medical Officer Federation, the Victorian ambulance union and the Community Council for Australia. ABS data shows that the average spending on meals out and fast food is less than $5,000 for all but the top fifth of taxpayers.

This is a sensible bill that includes sensible savings measures. It is a bill that is worthy of passing through this chamber and is worthy of the support this chamber, but it does highlight a fundamental flaw in the thinking and the arguments that are put forward by this government. I commend the bill to the Senate.

David Leyonhjelm (NSW, Liberal Democratic Party) Share this | Link to this | Hansard source

Seasons greetings to you, Mr Deputy President, and to all here in the Senate. With the parliamentary year wrapping up somewhat early, on 3 December, and with Christmas fast approaching, it is time to pause and look back on 2015.

What a year it has been. The government has been hitting home runs on tax reform all year. There have been five—count them: five—tax and superannuation laws amendment bills. I have loved every one of them—well, a kind of love. So in the spirit of Christmas, let me recite a little ditty about the five tax bills of Christmas. Given my warm feeling for all of the senators in this chamber, I was tempted not to sing it. It is true that I am not an undiscovered Pavarotti. But given its nature, I really I have no choice. So here it is:

In the first bill of Christmas my Treasurer sent to me

A tax on the elderly

In the second bill of Christmas my Treasurer sent to me

Slower deductions and a tax on the elderly

In the third bill of Christmas my Treasurer sent to me

Seafarer's tax, slower deductions and a tax on the elderly

In the fourth bill of Christmas my Treasurer sent to me

More CGT, seafarers' tax, slower deductions and a tax on the elderly

In the fifth bill of Christmas my Treasurer sent to me

More FBT, more CGT, seafarers' tax, slower deductions and a tax on the elderly

Merry Christmas, everyone.

Gavin Marshall (Victoria, Deputy-President) Share this | Link to this | Hansard source

Thank you, Senator Leyonhjelm. You are not the first person to sing in the chamber, but I think that was very eloquent. I do remember the Rock Lobster dance, though. I do not think you have surpassed that.

Mitch Fifield (Victoria, Liberal Party, Manager of Government Business in the Senate) Share this | Link to this | Hansard source

It was The Time Warp!

The DEPUTY PRESIDENT: The Time Warp, not Rock Lobster, yes!

Perhaps we should have called a point of order—

Gavin Marshall (Victoria, Deputy-President) Share this | Link to this | Hansard source

We have started Christmas early! I think I should call the minister now, to put some stability back into the chamber.

Mitch Fifield (Victoria, Liberal Party, Manager of Government Business in the Senate) Share this | Link to this | Hansard source

I think Senator Leyonhjelm has guaranteed himself a run in the electronic media. I really was going to just make that as a point of order, but I am not actually closing the debate.

Gavin Marshall (Victoria, Deputy-President) Share this | Link to this | Hansard source

Thank you.

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

I thank those senators who have contributed to this debate. This bill makes an important contribution to the government's commitment to simplify and modernise the Australian tax system, while improving fairness and integrity.

The first three schedules of the bill are 2015-16 budget measures, so this continues the important task of the government to get the budget back into balance as soon as possible. It amends the work-related car expense rules by modernising the rules and revising the set-rate-per-kilometre method. It removes access to the zone tax offset for fly-in, fly-out and drive-in, drive-out workers whose usual residence is not within a specified zone. It introduces a separate $5,000 cap for salary sacrifice entertainment benefits for certain employees of not-for-profit organisations. These benefits will also become reportable. The bill also creates a new data matching and compliance program requiring third parties to report to the ATO on a range of transactions.

This bill demonstrates the government's commitment to a fairer and simpler tax system that reflects a modern Australia. I commend this bill to the Senate.

Stephen Parry (President) Share this | Link to this | Hansard source

The question is that the bill be now read a second time.

Question agreed to.

Bill read a second time.