Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

by leave—I move:

(1)

Schedule 4, item 1, page 14 (lines 5-6), omit the item.

(2)

Schedule 4, item 2, page 14 (line 7) to page 24 (line 9), omit the item.

The sections in question relieve foreign entities and foreign people from having to pay capital gains tax in Australia. I am not going to go into the detail of what their assets are, but clearly shares are what we are in the main talking about. Australians have to pay that capital gains tax. The argument that will be put by the government is that these people pay capital gains tax in their own country. That is fine—the Americans, the Europeans and the Japanese can benefit from what these people do in this country. But the people of Australia should also benefit.

There should be no discriminatory legislation. It is bad enough having discriminatory legislation in any form, but when it discriminates against your own people it is, quite frankly, unbelievable. I find it incomprehensible. I am even a little bit worried about making press releases, because I think that people will not believe that what I am saying is true. I find it quite extraordinary. I am moving that the offending section of the bill be removed from the bill.

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Assistant Treasurer and Revenue) Share this | Link to this | Hansard source

I thought the minister might take the opportunity to respond, but it is apparent that he is not going to. So I think it is incumbent upon me to do so. The opposition facilitated the opportunity for the member for Kennedy to move his amendments notwithstanding the fact that we will not be supporting them in this place.

The member for Kennedy has raised some legitimate concerns. It was the same concern—or one of the concerns—on the part of the opposition that caused us to send this piece of legislation to a Senate committee. He is entirely right to raise those concerns in this place. Indeed, the opposition maintains its right to further pursue these same concerns in the Senate when this bill reaches that place. Why have we chosen to defer any further consideration to the other place? It is simply because we have only very recently been given some of the information we sought throughout the process of the Senate committee.

I think you could say that the Minister for Revenue and Assistant Treasurer in his summary tried to embarrass me by suggesting that all of the questions which were raised at the Senate committee hearings were answered. Indeed, he indicated that the Senate committee gave additional time to the department to provide those answers. But here is the point: why are we bringing legislation into this place upon which the department cannot provide answers weeks after its introduction? Why haven’t we got a situation where, when tax amendments come into this place, the questions can already be answered?

I would have thought that the Australian people would be somewhat concerned that a government is introducing amendments to tax law without knowing the answers to the questions that are likely to be asked in this place, in the other place and, indeed, during the Senate estimates process. The government and the framers of its legislation should know the answers to these questions in advance. They should not require additional time to answer those questions when they are asked in this place, in the Senate or, indeed, in the process of Senate committees.

The minister said that the government are now much better at consulting industry, so that is an acknowledgement that the government have not been particularly good in the past at consulting industry or other stakeholders, including consumers or the poor old taxpaying Aussie battler. But we want them to consult industry and other stakeholders before they introduce amendments to tax laws in this country. The current modus operandi is this: they throw the legislation at us on a Thursday; they typically have the second reading debate on the next Monday, Tuesday or Wednesday; and by Thursday of the next week they are moving their own government amendments because they have not consulted industry properly, they have made an error in law or they have miscalculated the financial impact of the bill on the budget bottom line.

So why are we in this situation? There is only one reason: we are in this situation because of the incompetence of the government—not the incompetence of the opposition. We only respond to what they put forward. When they put a tax amendment forward, we expect that they will know all the answers to the questions and they can disaggregate the costings and not lump them together. There are a number of measures contained within this tax bill which have the costings aggregated. We want them disaggregated, but of course they cannot provide the answers.

Harry Jenkins (Scullin, Australian Labor Party) Share this | Link to this | Hansard source

Order! I remind the honourable member for Hunter that consideration in detail is not an invitation to reopen the second reading debate.

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Assistant Treasurer and Revenue) Share this | Link to this | Hansard source

When the opposition seeks additional answers to questions about the financial impacts of the capital gains tax proposal that the member for Kennedy has expressed opposition to, we expect answers. Any normal citizen of this country would expect that a government that introduced amendments to tax laws would have those answers ready in their back pocket. They do not have the answers. Therefore, they do not understand the issue and they do not properly understand what they are asking this parliament to accept.

The member for Kennedy is right to express concerns. The opposition maintain our right in the other place, once we have digested the information we have now received in the form of late answers from the minister and his department. We will certainly keep our powder dry until we have had the opportunity to digest the answers properly. We will not be supporting the member for Kennedy on this occasion, but we were happy to facilitate his opportunity to express his opposition. Again, we will be maintaining our right to join with any senator who shares concerns about the impact of these capital gains tax changes. (Time expired)

Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

The lovely thing about being an Independent in this place is that you run against both parties at the next election and you can voice your opinions on both of them at the next election. I would hope that the ALP will take a different view when the bill goes to the Senate, where their actions have more bite. There has not been a single argument put up to defend this clause. I would hate to go to the people at the next election having had my name attached to this clause, but my name will not be attached. I point out to the House that both of my Independent colleagues are not here—and I am not blaming anyone for this, but we just received information that this is coming on tomorrow. I am certain that I speak for them when I say that they would trenchantly oppose this proposal. I am not too sure about what happens in this case, but I most certainly wish my vote to be recorded in the negative if, in fact, I am not able to divide the House on this issue.

Question negatived.

I ask that my vote is recorded.

Harry Jenkins (Scullin, Australian Labor Party) Share this | Link to this | Hansard source

The honourable member for Kennedy’s vote will be recorded in the Votes and Proceedings.

Peter Dutton (Dickson, Liberal Party, Minister for Revenue and Assistant Treasurer) Share this | Link to this | Hansard source

by leave—I present a supplementary explanatory memorandum to the bill and move government amendments (1) to (3) as circulated:

(1)    Schedule 4, item 2, page 17 (after line 29), at the end of section 855-25, add:

        (3)    The first element of the ^*cost base and ^*reduced cost base of a ^*CGT asset is the ^*market value of the asset on 10 May 2005 if, on that day:

             (a)    the CGT asset was held by:

                   (i)    an individual or company that was a foreign resident; or

                  (ii)    the trustee of a trust that was not a ^*resident trust for CGT purposes; and

             (b)    the CGT asset was a ^*post-CGT asset; and

             (c)    the CGT asset did not have the necessary connection with Australia (within the meaning of this Act as in force on that day); and

             (d)    the CGT asset was an ^*indirect Australian real property interest (within the meaning of this Act as at the commencement of this section).

        (4)    Also, Parts 3-1 and 3-3 apply to the asset as if you had ^*acquired it on that day.

(2)    Schedule 4, page 32 (after line 26), after item 38, insert:

38A Section 112-97 (at the end of the table)

Add:

                   (i)    an individual or company that was a foreign resident; or

                  (ii)    the trustee of a trust that was not a ^*resident trust for CGT purposes; and

I would like to add to the debate very quickly, in response to the member for Hunter and to some of the concerns that were raised by the member for Kennedy, bearing in mind the time constraints that we have. The government have, where possible, facilitated the requests of the shadow Assistant Treasurer. We have provided assistance, not just through my office but through Treasury as well, in a timely fashion, I believe. We lent every assistance to the member as was possible. In relation to the member for Kennedy’s contribution, the government are conscious of the issues that have been raised by the member for Kennedy. They have been raised in the Senate committee and we have addressed them as best we can through the consultation that we have conducted. The government firmly believe that these measures are in the best interests of this country.

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Assistant Treasurer and Revenue) Share this | Link to this | Hansard source

Given the hour, I will not continue the debate. I rose earlier because I was fearful that the Assistant Treasurer was not going to respond at all to either the concerns raised by me or those raised by the member for Kennedy. But, while I am on my feet, I just want to acknowledge the fact that the cooperation we have received from Minister Dutton’s office, with respect to briefings on these difficult tax matters, has been better than that which we received from Minister Brough. But it is obvious that in this case there have been a number of shortcomings in the availability of information that we have sought from both the minister and his department.

Question agreed to.

Bill, as amended, agreed to.