Kevin Hogan (Page, National Party, Deputy Manager of Opposition Business in the House) Share this | Hansard source

The coalition is not opposing this bill—the Treasury Laws Amendment (Delivering an Efficient and Trusted Tax System) Bill 2026—in this chamber, but in the Senate we are looking to refer it to the economics committee for further scrutiny. The bill contains a range of technical tax measures. Many of the measures are sensible and many of them are non-controversial. The most significant part of this bill is the exclusion of tobacco and gambling activities from the research and development, or R&D, tax incentives. When we look at this measure, we're not necessarily opposed to it but we do want closer scrutiny.

Where we're going with this is that there are two issues we need to look at here. One is that the government—for the first time, really—is now starting to have a subjective opinion on which business or sectors should be able to apply for this R&D incentive. We're happy to have that debate, but, obviously, once you open this door, you open the door to the government, if it doesn't like a certain sector—for whatever subjective reasons—saying that they can't apply for this incentive. We want that to be further investigated. With the specific one of gambling, we also want some further investigation about what is going to be termed, or what is going to be recognised as, a gambling activity. There are definitions around that. There is the discussion about whether some kids games, in the way that they might give prizes to a winner or what have you, be looked at. There are very important questions here that we think need to be answered.

I would also make a point about the tobacco one. We're happy to look at whether the tobacco industry should be able to get this R&D incentive, but we need to make the point here that the tobacco industry itself is in complete disarray at the moment. We've lost billions of dollars in tax revenue. In 2022, when the government came to office, projected tobacco excise for 2025-26 was $13.3 billion, and the estimated collections now are down to $7.3 billion and are going to be $6 billion in 2025-26. So there's a lot going on in that industry. Illicit tobacco is now being made, and illicit cigarettes are far cheaper than they've been in recent history, and they're showing up in wastewater data. We think that this industry needs to be looked at a bit more widely. Organised crime is moving into that industry, having a big say controlling that industry—along with vaping, which brings a whole lot of other questions. We question whether some of that is the reason the government is looking at this and at the R&D incentive. There are lots of questions around tobacco that need to be answered, but we would just make that point.

Earlier I mentioned the video game sector and whether some kids games could be captured, in these changes, as a form of gambling. There are games like the Untitled Goose Game, by House House; Fruit Ninja; and Hollow Knight, which all give rewards for certain things and certain processes when you play.

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