Tony Smith (Casey, Liberal Party) Share this | Hansard source

After the excitement of the debate on the MPI it is rather fitting that we move to the tax law amendment bills that need further discussion here in the House. As you pointed out, Deputy Speaker, we are dealing with two of them: Nos 4 and 5. Tax and Superannuation Laws Amendment (2014 Measures No. 4) Bill 2014 has five schedules. Tax and Superannuation Laws Amendment (2014 Measures No. 5) Bill 2014 has four schedules covering a range of matters. In the time available I will confine my remarks to some of the schedules in Tax and Superannuation Laws Amendment (2014 Measures No. 4) Bill.

As the Parliamentary Secretary to the Treasurer outlined when he introduced this bill, it amends various taxation laws. In particular, schedules 1 to 3 legislate announcements made by the previous government—in many cases, years ago. In fact, if my memory serves me correctly, I spoke on the matter in schedule 1 dealing with thin capitalisation, in a tax law amendment bill about five years ago. It was one of many items that had not been legislated by the time of the last election. As the Treasurer identified last year, they were matters that we said we would deal with, and we are dealing with those matters in the course of this debate

Through legislating the integrity measures in schedules 1 and 2—and schedule 2 deals with foreign resident CGT integrity measures—there will be an increase in revenue of about $755 million over the four years of the forward estimates.

I do want to focus my remarks on schedule 4 of this bill because I think it is important from not only a transparency point of view but also a taxpayer's confidence point of view. This is the schedule that deals with tax receipts. Deputy Speaker, you and other members of the House will recall that the Treasurer announced when he was in opposition the policy that the Commissioner of Taxation would issue tax receipts to individuals following their income tax assessment. We made this commitment before the election and it was announced as part of the budget earlier this year.

This is an important transparency measure. Australian taxpayers deserve to know what their taxes are being spent on without having to sift through the copious budget documents that come out in the second week of May each year. This tax receipt will be a concise one-page personalised and itemised receipt. It will almost always accompany the taxpayer's notice of assessment. Taxpayers will be able to see proportionally the areas of government where their tax dollars are spent.

Those opposite are not in favour of this measure. They are not in favour of taxpayers seeing exactly where their tax dollars are spent. We suspect that is because they will see the proportion that is being spent on debt. But it is that very issue that is so central to our budget approach. When this government took office it inherited a debt and deficit situation very similar in story to the debt and deficit situation that the Howard government inherited back in 1996. Both the Treasurer and the parliamentary secretary have spoken about the projected budget deficits, about the debt road we were on and about the necessity for this government to take action to change direction. In the time available I want to talk a little bit about this because it is very important for every taxpayer. The receipt that they will get will give them a snapshot of the budget priorities and it will highlight the fact that, while governments make decisions, they spend money from taxpayers or money that is borrowed on behalf of those taxpayers that must be repaid by those very taxpayers.

As we know, all of the net government debt inherited by the Howard government was repaid after many long years and difficult budgets. In fact, it took about a decade—'debt-free day' for Australia was back in April 2006. But, of course, with the election of the Rudd government and with the appointment of Mr Swan as Treasurer, Australia very quickly got back on the debt road. While the Treasurer has spoken many times, quite rightly, in terms of the gross debt for comparative purposes with the $96 billion of net debt inherited by the Howard government, by the time this government was elected the situation was very much the same story.

Let us not forget that the former Rudd government back in 2007 did not just inherit no debt; they inherited $45 billion in the bank. By the end of their term that position was a net debt position of about $200 billion—basically, $¼ trillion deterioration. It meant that the road we were on, with that debt increasing with each budget deficit each year, had to be turned around. That is precisely the task and the responsibility of this government. That is why this budget is taking the tough and difficult steps necessary.

It is often said that you cannot live beyond your means. Of course, the truth is that, whilst that is ultimately true, you can live beyond your means for a period of time. There is quite a bit of hang time. In family budgets you can live beyond your means for a while but ultimately the costs of servicing that debt mount up and difficult choices confront you. In the case of governments it is much the same. We will not begin to reduce our debt until we have the first budget surplus. At that point we will begin to pay it down. But what this government has done is ensured that we will not stay on that debt trajectory, escalating at the rate it was destined to if we took no action and on a road that would lead to more difficult choices in the years ahead.

The tax receipt that is part of this schedule is a transparent measure to report annually to taxpayers—shareholders in so many respects—so they can see precisely what government is spending their money on and why. I am very confident that in the years ahead, as these receipts come out, taxpayers will see the benefits of the government's budget policies—policies that will deliver a more responsible outcome and, importantly, a better future for taxpayers.

I will confine my remarks to those matters in the Tax and Superannuation Laws Amendment (2014 Measures No. 4) Bill 2014. I commend this bill and the related bill to the House.

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