Tuesday, 24 August 2021
Treasury Laws Amendment (2021 Measures No. 2) Bill 2021; Second Reading
I rise to speak to the Treasury Laws Amendment (2021 Measures No. 2) Bill 2021. This bill undertakes largely technical amendments via two schedules. The first concerns the regulation of charities and the second concerns the taxation treatment of offshore banking units. Although Labor supports these changes, Labor will be taking the opportunity presented by this bill to address some other serious problems created by the Morrison government with respect to the two policy areas covered by this bill—charities and tax. I will deal with charities first.
Schedule 1 of the bill amends the Income Tax Assessment Act 1997 to require non-government entities seeking endorsement as a deductible gift recipient or DGR to be a charity registered with the Australian Charities and Not-for-profits Commission or be operated by a registered charity. The amendments include a 12-month transition period, which will give non-charity DGRs time to meet the requirements for charity registration without losing DGR status. Some DGRs will be able to apply for a longer transition period of up to three years.
Labor notes that this change will improve the consistency of regulation, governance and oversight of DGRs, which the government says is meant to help support continued confidence in the sector and public support for DGR entities. It's ironic that it was the government that claimed the measures here are meant to help support continued confidence in the sector when in another way they're cracking down on the sector in one of the most draconian of manners. Not in this bill but in regulations, the government has proposed to extend the ability of the charities commissioner to deregister a charity for a summary offence or because the charities commissioner anticipates that the organisation will commit a summary offence. This crackdown is just emblematic of how this government engaged with the charitable sector.
Charities and volunteer organisations are doing crucial work to help vulnerable families, people and communities get through these lockdowns. They are helping to mop up the consequences of the Prime Minister's mistakes in Sydney, in Dubbo, here in Canberra and in many other places across the country. It's not just social justice charities. When we don't have half of this country under lockdown, charities are cleaning up our waterways, working to tackle climate change or improving access to essential health care. Instead of the government engaging in a partnership that recognises the important work that can be done working with environmental charities on climate change, with social justice charities on poverty alleviation and with health charities on tackling COVID, they decide to wage a war on charities. The latest salvo in the government's proposed regulations has the effect of reducing the scope of charitable activism and it goes to the fact that the government doesn't want these entities discussing issues of law reform or broader social issues—that is, these charities should be seen but not heard.
Opposition to these changes is broad. Law firm Arnold Bloch Leibler, who says the changes are fundamentally inconsistent with our democratic system of government, has opposed the changes. In addition, the Law Council president has said that the changes will leave registered charities, including faith based charities, at grave risk of political interference. A full-page advertisement in the Australian Financial Reviewsaid 'Don't stop Australia's charities from speaking out'. It was co-signed by St Vincent de Paul, Catholic Social Services Australia, Anglicare, UnitingCare and others. The CEO of the Community Council for Australia said:
Any suggestion that the ACNC commissioner can act against a charity because he or she believes they may do something wrong—even when there is no evidence they have done something wrong—seems at best to be against every principle of justice, fairness and procedural transparency, all of which should be fundamental values for any regulator.