Maria Kovacic NSW, Liberal Party, Shadow Assistant Minister for Women
2:00 pm
My question is to the Minister representing the Prime Minister, Senator Wong. This week, estate planning lawyer Rachael Rofe warned that Labor's proposed 30 per cent trust tax could force families to distribute income and capital to beneficiaries no matter what their circumstances are, including family members battling addiction, relationship breakdown and family estrangement. Why is the Albanese government forcing Australian families to choose between paying the Prime Minister's latest tax grab and protecting vulnerable family members, including victims of domestic violence, from financial harm?
Penny Wong SA, Australian Labor Party, Minister for Foreign Affairs
Thank you, Senator Kovacic. I won't divert on this, but you have seen, from the work that Minister Gallagher and Minister Plibersek have done, the commitment that we have to doing whatever we are able as a government to combat and confront family violence. In relation to the trust arrangements, I'd make a few points which I think are relevant here. The vast majority of Australians—that is, some 95 per cent of Australians—do not receive discretionary trust income. And, as I said yesterday, the vast majority of small businesses don't operate through a trust.
In relation to the distribution arrangements, the reforms, as I understand them, do not limit the flexibility of discretionary trusts to add beneficiaries. The government is providing an additional option for trusts to elect to make fixed distributions, and the trusts do retain the flexibility to change their approach in the future. New beneficiaries can be added—for example, when someone passes away. There are already integrity rules that relate to distributions from trusts, including to minors. Obviously, those rules were put in place over 40 years ago when Mr Howard was the treasurer. You would also be aware that the changes that the government has put in place, which include better aligning the taxation of assets and income, have enabled the delivery of a new permanent tax cut for every working Australian.
Maria Kovacic NSW, Liberal Party, Shadow Assistant Minister for Women
2:02 pm
Can the Prime Minister guarantee that Labor's proposed trust tax will not undermine protections for vulnerable Australians, including the victims of domestic violence and financial abuse, or inadvertently benefit the perpetrators of that abuse?
Penny Wong SA, Australian Labor Party, Minister for Foreign Affairs
2:03 pm
We always work to try and ensure that survivors of violence are—
Well. I think every government has to try to do that. But I think that—
Michaelia Cash WA, Liberal Party, Leader of the Opposition in the Senate
You legislated a widows tax.
Penny Wong SA, Australian Labor Party, Minister for Foreign Affairs
If I may—
Michaelia Cash WA, Liberal Party, Leader of the Opposition in the Senate
Knowingly.
Penny Wong SA, Australian Labor Party, Minister for Foreign Affairs
I think every government has an obligation to try to ensure that whatever arrangements are in place are not utilised in abusive relationships to perpetrate that abuse. And I'm sure that the Treasurer is mindful of that, just as we are mindful of this in the context of many other areas including superannuation.
Maria Kovacic NSW, Liberal Party, Shadow Assistant Minister for Women
2:04 pm
If the government confirms that its trust tax could inadvertently benefit perpetrators of domestic violence, will the Prime Minister commit to scrapping what can only be described as a toxic tax?
Penny Wong SA, Australian Labor Party, Minister for Foreign Affairs
We will not be committing to simply not proceeding with tax arrangements because you don't agree with them.
Michaelia Cash WA, Liberal Party, Leader of the Opposition in the Senate
We didn't say we didn't agree with them.
Penny Wong SA, Australian Labor Party, Minister for Foreign Affairs
You don't agree with—the reality is trusts are used by a very small proportion of Australians.
Sue Lines President
Minister Wong, please resume your seat. Senator Kovacic.
Maria Kovacic NSW, Liberal Party, Shadow Assistant Minister for Women
On a point of order, that's not what my question was. I'm happy to repeat the question for clarity if required.
Sue Lines President
Thank you, Senator Kovacic. It was hard in some parts to hear the minister, but I will continue to listen closely. I couldn't hear the minister, because of the level of interjection. But I'll continue to listen carefully. Thank you, Minister.
Penny Wong SA, Australian Labor Party, Minister for Foreign Affairs
First, in relation to women's safety—I will add to this if I'm incorrect—we have invested in excess of $4 billion into measures to support women's safety and to confront violence. So let's be clear—everybody in this chamber has the same view when it comes to family violence. That's the first point. The second point is that I appreciate the opposition are looking for ways to argue—
Michaelia Cash WA, Liberal Party, Leader of the Opposition in the Senate
You scrapped the tax.
Penny Wong SA, Australian Labor Party, Minister for Foreign Affairs
I will take the interjection from the leader. They want us to scrap a tax on trusts. And we have said we are ensuring a fairer tax system. (Time expired)