Claire Clutterham (Sturt, Australian Labor Party) Share this | Hansard source

I rise today to speak in support of the Treasury Laws Amendment (Delivering an Efficient and Trusted Tax System) Bill 2026, which is another bill in support of the Albanese Labor government's drive to strengthen the integrity of the tax administration system. I'm going to do something a little different to previous members who have contributed to this debate and actually talk about what's in this bill. In doing so, I seek to do two things. Firstly, I seek to highlight that this bill contains a number of very uncontroversial measures. Secondly, the measures may be uncontroversial, but they're very important on a number of topics for the Australian people, particularly with respect to research and development—which I didn't hear mentioned in the contribution from the previous member. There are important things in this bill that deserve to be highlighted. To start with, it's important that our tax system is modern and easy to use, with compliance costs for individuals, trustees, beneficiaries, business and taxation professionals that are as low as possible. This bill, which is comprised of four schedules, seeks to do just that.

Firstly, schedule 1 is directed at philanthropic giving and removes the requirement that a donation to a deductible gift recipient be valued at $2 or more before the donor may claim an income tax deduction. This removal supports charitable giving and also contains updates that reflect contemporary fundraising practices. This modernisation takes effect by amending the Income Tax Assessment Act of 1997 to allow donors to claim a tax deduction on donations to deductible gift recipients under subdivision 30-A even if they are valued at less than $2. There is a background to this, and it stems from the October 2022-23 budget, which led to the Productivity Commission conducting a review of philanthropy as part of the government's election commitment to double philanthropic giving by 2030.

The final report from the Productivity Commission was handed down on 10 May 2024 and included 19 recommendations. The measures contained in schedule 1 to this bill implement one of those recommendations. The modernisation reflected by schedule 1 to the bill relates primarily to point-of-sale round-up schemes with retailers and online vendors. For example, when I go to Petbarn to buy cat food for my cats, I'm always asked whether I wish to round up to make a donation to an animal welfare group. This system, since 2012, has actually helped the Petbarn Foundation itself donate over $25 million to help animal welfare groups and rescue organisations through Australia.

The purpose of these amendments to the Income Tax Assessment Act is to continue to encourage these low-value donations because, as I have explained—30c here, $1.50 here—low sums that you don't even notice can make a huge difference to charitable organisations, and that is worth highlighting to this chamber. In section 30-15 of the Income Tax Assessment Act of 1997, there is a table that sets out the situations where a gift or contribution is deductible, who the recipient of the gift or contribution can be, the type of gifts or contributions that are deductible, how much is deductible and any special conditions.

Schedule 1 to this bill amends that to remove the $2 threshold listed in the 'Special conditions' columns of the table. That means there's no minimum donation amount for the donation to be deductible for a number of organisations and institutions. The removal of the $2 gift threshold is limited to gifts or contributions under subdivision 30-A of the Income Tax Assessment Act. It doesn't extend to donations to political parties—let's be clear on that—candidates or members, including independents. These amendments will have retrospective effect applying from 1 July 2024, so anyone who has donated to a deductible gift recipient since then will enjoy the benefit that this amendment brings.

Then we have schedule 2 to the bill, which operates to again amend the Income Tax Assessment Act to require trustees of closely held trusts to report in the trust's income tax return the quoted tax file numbers of beneficiaries when they have an entitlement. This will be a requirement from 1 July 2026 and will streamline how trustees report tax file numbers, removing reporting on a separate form. What this means is that trustees must report beneficiary tax file numbers at the same time that the trust tax return is lodged for income years that the beneficiary is presently entitled to a share of income of the trust. This requirement replaces the obligation for trustees to lodge a tax file number report for the quarter in which a beneficiary quotes their tax file number to the trustee.

The amendments support efficiency because they support prefilling of beneficiary income tax returns. This amendment also speaks to the integrity of the tax system, because it will help to ensure the right amount of tax is being paid by trustees and beneficiaries on trust income, which is fair to everyone. This is also about improving and digitising trust and beneficiary income reporting to reduce the compliance burden on taxpayers by increasing prefilling capabilities and improving the ATO's processes—again, something that is worth highlighting in this chamber.

Then we have schedule 3, which makes small amendments to legislation within the Treasury portfolio directed at sustaining the government's ongoing commitment to the care and maintenance of Treasury laws. The point is to make sure that the Treasury portfolio of legislation remains current and fit for purpose and continues to work for relevant stakeholders and the broader public. It might be minor and administrative in nature, but it does have significant and important impact.

Finally, we have schedule 4. To the extent that it's possible to have a favourite schedule of a bill about the integrity of the tax system, schedule 4 is my favourite. The background to the amendment proposed by schedule 4 is important, and it's relevant to understanding the amendment's purpose. In MYEFO 2024-25, the Albanese Labor government announced that activities related to gambling and tobacco would be excluded from research and development tax incentive eligibility for income years starting on or after 1 July 2025. The government made this announcement following the ATO's first annual R&D tax incentive transparency report, which was handed down in October 2024 and which provided information on companies that claimed the R&D tax incentive in 2021-22.

Schedule 4 amends the Income Tax Assessment Act to exclude activities related to gambling and tobacco from research and development tax incentive eligibility—except those related to harm minimisation. This amendment is directed at ensuring the community can have confidence that they are not subsidising this kind of research and development, which can exacerbate serious social problems, including health risks, addiction and associated harms. This is research and development relating to all types of gambling and any type of tobacco. With respect to tobacco, activities related to tobacco, as well as nicotine products and vaping goods, are excluded from what is called core and supporting research and development activities.

As I said, R&D directed at harm minimisation is not covered by schedule 4, and that is entirely appropriate. This government recognises that modern, contemporary and effective harm minimisation strategies are critical when it comes to gambling and tobacco and that these strategies are driven by research and development, which focuses on practical, evidence based strategies with the key priorities of safety, health, dignity and the removal of shame and stigma—which is one of the most important factors in harm minimisation, because the removal of shame and stigma surrounding addiction is a key step in helping someone to address a problem.

Indeed, the statutory review of BetStop the National Self-Exclusion Register was tabled in parliament on 25 February this year. First and foremost, the review recognised that BetStop is actually working as a harm reduction strategy. The Prime Minister, during question time on 25 March 2026, noted that there had been a total of 58,000 registrants, with 38 per cent of those people having chosen a lifetime ban. Eighty per cent had experienced better overall quality of life and better mental health. This is important research that has measured the effectiveness of this self-exclusion system, and the results underscore why research of this nature must continue. Secondly, a key finding was that people who had registered for BetStop and who had nominated a support person were experiencing better outcomes from their registration with BetStop. A reason someone might not nominate a support person is that they are ashamed of their addiction and they want to keep it a secret, but a support person can help by providing accountability as well as care and kindness.

So it is important to highlight to this chamber that the carve-out in schedule 4 of this bill for research and development activities that are conducted for the sole purpose of harm minimisation is critical. This might include research directed at stopping addiction, and targeted and dedicated efforts of researching, measuring and implementing further harm minimisation strategies. Research and development that is focused exclusively on harm minimisation will still be eligible for support and, quite rightly, should be eligible for support. For the sake of clarity, and given the importance of this issue, the amendments operate to exclude certain gambling related research, both as a core research and development activity and as a supporting research and development activity. So activities that relate to a gambling service, gambling or gambling-like practice are excluded from being R&D activities.

What does this mean? 'Gambling service' will take the meaning in section 4 of the Interactive Gambling Act of 2001 and includes three recognised types of gambling: wagering, lotteries and games involving chance that are played for money or anything of value and which involve consideration, as well as any other gambling service within the ordinary meaning of that expression. The exclusion proposed in schedule 4 of this bill will quite rightly have a broad application.

Then we have the definition of 'gambling-like practice', which is defined by the digital games tax offset definition in the Income Tax Assessment Act. Activities that relate to a gambling-like practice contribute to gambling related harm in the Australian community, particularly by normalising gambling behaviours and increasing exposure. These have been excluded and, again, this is a broad-reaching and appropriate exclusion. Digital games will be unaffected if they don't relate to gambling-like practices.

Then we have the supporting research and development activities, and schedule 4 will operate such that an activity that relates to gambling services, gambling or gambling-like practices is also excluded from being a supporting research and development activity. Importantly, the dominant purpose test that otherwise applies to supporting research and development activities does not apply to these activities, as a more restrictive test is to be applied instead, which speaks to this government's commitment to harm minimisation.

I'm pleased to have shared the nature of schedule 4 to this bill with the chamber. There's a lot going on in this parliament at the moment, and I understand everyone wants to talk about the budget, but the details contained in this bill will have a significantly positive effect on the community. They take away the ability to research gambling and tobacco related activities and place an emphasis on harm minimisation. It is initiatives like this that do deserve to be highlighted and spoken about in this chamber, as they form part of the government's dedicated efforts towards improving harm minimisation. I commend the bill to the House.

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