Claire Chandler (Tasmania, Liberal Party, Shadow Minister for the Public Service) | Hansard source

Thank you very much. My understanding is that I can now speak on that motion; I would like to do so to explain what we are doing here today. I have sought that the question be divided so that the question relating to these bills proceeding without formalities can be put separately. While it is a common occurrence in this chamber for bills to proceed without formalities, and indeed the motion that is currently before the chair is rarely debated, it's worth understanding why we are seeking for this to occur. Usually, putting a question without formalities allows for expedited proceedings which provide for a simple, rational and flexible means of considering bills. But nothing about these bills, or the government's approach, has been simple, rational or flexible. I want to be very clear about what is actually before the Senate today. The bills that will be brought on shortly were rushed through a process and followed by a Senate inquiry that, frankly, I can only describe as a stitch-up.

This is a bill that will bundle higher taxes on housing, savings, small business, start-ups and family wealth, and this government has the audacity to call that tax reform. The Australian people and Australian businesses are angry and disappointed with Labor's toxic taxes. The government, like I said, is calling this tax reform, but it's not. They are very major changes to the tax system and they come with very real consequences, because when you strip it all back and when you take away the branding and the label 'tax reform No. 1' you are left with a set of measures that will increase taxes, make the system more complicated and introduce new risks into the economy. So, as I say, nothing about these bills or the government's approach to these bills has been simple or rational or flexible, and that is why we do not think that these bills should proceed without formalities in the usual way. That is why I have asked for this question to be divided here this afternoon.

Let's just step through these bills and exactly why and how the approach that has been taken to them by the government in ramming them through this chamber has been so, frankly, unorthodox. This package is a tax increase. It will increase the tax burden on Australians, and that means something very simple: it means that the government is taking more of Australians' money and Australians will be keeping less. These bills don't fix the underlying problems in the tax system. We already rely too heavily on income tax in this country and, if you were serious about reform, you would look at how to reduce pressure on income tax. But that is not what is happening here. Instead, we are leaving the overall structure of our income tax system largely as it is and layering new taxes and rules on top of it, so, at the end of the day, it is in effect the same system. It's just applying a heavier tax burden on Australians.

The third thing I wanted to touch on is that these bills make the tax system more complicated, not less, because what the Albanese government has introduced here is not straightforward. There has been significant media reporting since the budget has been handed down—indeed, we heard significant evidence to the Senate inquiry over the last few weeks—that would indicate just how complicated these changes are. I will just quickly summarise. We will have a new indexation system for capital gains. We will have a 30 per cent minimum tax rate on capital gains. We will have different treatment depending on when gains are made. There are grandfathering rules. There are a whole range of details that are still to come through legislative instruments. With the legislation that we will be debating here today, once the debate for these bills proceeds properly, so much of the detail that sits behind those bills is yet to be made clear to the Australian people. Even the evidence to the economics committee inquiry made clear that taxpayers are going to be dealing with two systems running side by side during this transition. It's not simplifying the tax system; it's making it harder.

Fourth, we need to talk about the impact that these bills will have on investment, because that is what really matters. Australia needs more investment right now. We need people willing to take risks, willing to start new businesses or willing to grow their businesses and invest in new opportunities. But what I and other senators who participated in the Senate inquiry heard time and time again is that these bills will create real trade-offs and add more risks for businesses at a time when they are just seeking certainty in the investment environment. Even witnesses who supported elements of the reforms that these bills propose acknowledged those risks. There are consequences here, and they go directly to how people make decisions about investing in this country. I want to get, in a moment, to the process that these bills have gone through in the Senate inquiry, but it was abundantly clear from evidence at the Senate committee hearings that we had last week that there are still no clear answers for Australians and for Australian businesses on the broader impacts of these bills.

So let's talk about that process, because, as I say, it's very fresh in my mind. Last week, the Senate Economics Legislation Committee held two committee hearings into these bills, and to describe those hearings as a sham would be putting it generously. It was a rushed inquiry that did not give enough time for people to make a submission. It didn't even give the government's own Treasury department enough time to read all of the submissions. Officials admitted to the committee through the inquiry process that they did not have enough time to read all of the submissions and address any of the issues that those submissions highlighted, because the inquiry process was just too short. During the inquiry, we also heard peak bodies confirming that they weren't consulted prior to the drafting of the bill.

But we did learn about some very concerning aspects from this inquiry. Treasury, when questioned, could not separate the revenues raised from the CGT changes and the revenues raised from the negative gearing changes. They confirmed, like I said, that they hadn't read all the submissions, and they couldn't say how many of the submissions they had read. They couldn't say when a paper for consultation would be delivered. They couldn't say when they did modelling on the impacts of the policy nor what timeframes they had taken to do that modelling prior to making key budget decisions. They could not guarantee that they would even get through all the submissions and any drafting errors that might have been identified—and some of the submissions did identify drafting errors—by the time the legislation passes, which will happen at some point, I assume, in the next couple of sitting weeks.

I know the government likes to call this tax reform, but these last-minute carve-outs that we've heard about over the weekend from the Prime Minister and from the Treasurer suggest that this is less about reform and more about policy on the fly. Again, when I talk about the simple, rational and flexible way that the chamber should usually be able to consider legislation—the approach that the government has taken to getting these bills passed has been far from simple, it has been far from rational and it has been far from flexible.

We got news from the Prime Minister and the Treasurer, just a couple of days ago, that they're still tinkering around the edges as a result of, perhaps, conversations that they've been having or testimony from the Senate inquiry, although I struggle to see how that really could have been formative, in terms of the government's view, given the government's own department admitted that they hadn't read all of the submissions, nor had they done any real analysis of the issues that had been identified by those submissions. That is not what you would call a careful and considered approach to reform. The Senate inquiry, frankly, was a sham and a stitch-up, and this whole process has been incredibly disrespectful not only to the senators and the people who participated in this inquiry but, more importantly, to Australian people and Australian businesses.

Let's wind back the clock about 13 months and remember that this is a government that promised, time and time again during the election campaign last year, that there would be no changes to capital gains tax and that there would be no changes to negative gearing. They broke that promise on budget night last month, and now they have rushed through legislation in this place and they don't even know the full consequences of the legislation. They can't even tell the Australian people how much revenue these tax changes will bring in for the government, disaggregated between the capital gains changes and the negative gearing changes. That troubles me.

I don't like getting grumpy with government officials during Senate estimates or committee hearings, but I was furious sitting there in Sydney last Tuesday. I asked a bunch of Treasury officials who were on the phone—they didn't come along in person, for whatever reason—a very simple question. I said, 'Tell me how much the CGT changes are going to cost and how much revenue they're going to bring in, and tell me how much revenue the negative gearing changes are going to bring in.' They could not provide me with an answer. They could give me the collective number—that's great—but when so much attention through the inquiry process has been placed on the confusion around the capital gains tax changes and the impact they are going to have on investment by businesses in this country, I think it is only fair that Australians and Australian businesses expect their government to come to the table, literally, and be able to answer simple questions about what the impact of these changes is going to be on the budget's bottom line. If you can't articulate that, frankly, I'm confused as to how this chamber is even in a position to consider this legislation.

Like I said, serious concerns were raised across the board about the consultation process the government went through—this was, again, during the Senate inquiry—about the detail and about the gaps in the legislation. We are being asked in this chamber today to consider significant tax changes with key definitions still to come, with important details to be set later on down the track and with changes being proposed by this government in the days leading up to the debate in this chamber. That is not how this place should appropriately consider legislation. That is not how this place should consider significant changes to our tax system. I think it does a real disservice to this chamber, to the other place and to the whole institution if we are being asked to debate legislation when we don't know fully what the details are going to look like and if there are going to be other things that will be worked out later on down the track. This government has appeared at a Senate inquiry and has not been able to answer very basic questions.

It is a regular occurrence in this chamber that bills proceed without formalities. Ninety-nine per cent of the time, I'm sure it's what happens. In moving this motion here today—I do not do this lightly, but the reality is that allowing bills to proceed without formalities is something that allows for expedited proceedings to provide for a simple, rational and flexible means of considering bills. Most of the time that's appropriate, but where it is inappropriate is where the government is putting a bill before the chamber that is not simple nor rational, and where the government has not been flexible in the approach that they have taken in bringing these bills through.

This is not a simple tax reform. This is a tax grab that has been dressed up as fairness. It's a broken election commitment. I'm sure many colleagues will be talking about all of these things when the second reading debate does eventually progress. But the government has taken us all for a ride and has not been clear about what their changes are, how this legislation gives effect to their changes or, indeed, where further legislation will be required to give further effect to their changes.

I asked that the question that the bills proceed without formality be put separately because I don't think it is appropriate for the bills to be given a free waiver without formalities when the manner in which they has been brought to this place has completely undermined the integrity of what we all do here as a chamber of inquiry.