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Monday, 27 February 2006
Page: 76


Mr SLIPPER (5:34 PM) —This is an omnibus bill that covers a range of taxation changes. I suppose that, given the difficulty of getting matters before the parliament, it is quite natural that the government from time to time would seek to make a number of relatively minor changes together in the one omnibus bill. The second reading amendment moved by the honourable member, the shadow minister, opposite is obviously a bit of a stunt. He certainly raises an interesting point that is worthy of consideration. But if he were serious about having the government consider this he should have not done it in a such a grandstanding manner. It would have been better for him to privately contact the Minister for Revenue and Assistant Treasurer to point out the problem as he sees it rather than come in here and try to hijack the debate on this very important Tax Laws Amendment (2005 Measures No. 6) Bill 2005.

The Tax Laws Amendment (2005 Measures No. 6) Bill 2005 has a number of purposes that are designed to modify and update the Income Tax Assessment Act 1936 and the Income Tax Assessment Act 1997. When one looks at the bill and the explanatory memorandum it is obvious that a number of different areas are being covered. In fact, there are five chapters, including consolidation, available action for lost utilisation purposes, extension of the mutuality principle, child-care tax offset, medical expenses offset and exclusion of solely cosmetic procedures, and there is a chapter on deductible gift recipients.

With respect to child care, the bill enables changes that allow those who are eligible for the child-care tax rebate to continue to receive the rebate if, at some time during the week, they work, train or study. It is admirable that many of those mothers who stay at home to care for their young children have made, or are planning to make, the extra effort to go to work, train or study once their youngest children are of school age. It is important that children are given the opportunity to spend as much quality time as possible with their parents as they grow up.

While child-care centres are important institutions that provide a vital service in Australia, no-one can deny the value of personal contact between a young child and his or her parents. The bill maintains the work, training and study requirements for eligibility for the child-care tax offset at the level they were at before the introduction last year of the Welfare to Work legislation. This legislation will not affect eligibility for the child-care tax offset.

I mentioned before that there were some changes with respect to the medical expenses offset and cosmetic surgery. The bill also will make some very important reform changes with respect to not-for-profit organisations. The bill ensures that not-for-profit organisations will not be hit with income tax bills as a result of a decision in the Federal Court in September 2004. On 27 May last year—that is, 2005—the High Court of Australia rejected a request by Coleambally Irrigation Mutual Cooperative Ltd to appeal a decision that the principle of mutuality cannot apply where the members of an organisation are prevented from obtaining the value of the assets on its winding up. The Federal Court decision would have potentially affected some 300,000 Australian organisations. That is clearly not a particularly desirable situation. This bill, though, ensures that membership subscriptions and receipts received from members of the organisations are not subject to tax, and it will give legislative backing to the tax office practice that applied to distribution clauses prior to the judicial decisions.

The various parts of this bill, quite understandably, come into effect at different times. This reflects when announcements were made and also when the government considers it appropriate that individual changes included in the Tax Laws Amendment (2005 Measures No. 6) Bill 2005 ought to apply. The second reading amendment is a matter which has been raised by the honourable member for Hunter. I believe he has done so in a way that is designed to play politics, instead of with a view to bringing about what the member for Hunter no doubt considers ought to be a change in the definitions. I commend the Tax Laws Amendment (2005 Measures No. 6) Bill 2005 to the House.