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Monday, 13 February 2012
Page: 1002


Mr NEUMANN (Blair) (16:05): I speak in support of this TLAB legislation, the Tax Laws Amendment (2011 Measures No. 9) Bill 2011. This bill, like all bills that amend the tax laws in an omnibus way, does it by way of schedule. I want to focus particularly on schedule 1, which is the portability of superannuation and the implications there. By way of an example, I will describe my own electorate and how changes being made to superannuation will have an impact there.

Firstly, I will briefly go through the other aspects of the bill. Schedule 2 is part of the 2010-11 budget, where we announced that we were amending the capital gains tax provisions to make it easier for businesses to restructure. There are a number of provisions here. This amendment talks about certain business structures and broadening access to CGT rollovers. This is consistent with our commitment to streamline business to make it more flexible so that it can operate in a way that is not governed by regulation and the tax laws do not impinge in an adverse way. It extends the CGT rollover for the conversion of a body to an incorporated company—and that often happens. It is often the case that businesses change the way they are structured. That is a sensible provision. It broadens the range of CGT rollovers where entities can use a share or interest sale facility for foreign residents in a restructure and allows the CGT demerger relief for demerger groups that include corporations sole or complying superannuation entities which cannot access the relief. It is a sensible arrangement and really is good public policy.

Schedule 3 provides for the CGT financial supply provisions. It increases the first limb of the financial acquisition threshold from $50,000 to $150,000. The purpose of that is to follow recommendations that were made in the Treasury's review of the CGT financial supply provisions to make sure that we can take businesses out of the system. It means that we are excluding financial suppliers consisting of borrowings made through the provisions of a deposit account by Australian authorised deposit-taking institutions from the current concession for borrowings; and allows the taxpayer who accounts on a cash basis to treat an acquisition made under a hire purchase agreement as though they did an account on a cash basis.

The next provision I want to deal with is the CGT treatment for new residential purposes. This corrects an error made, I think in a court, in the case Commissioner of Taxation v Gloxinia Investments. This decision found that a sale of certain residential premises to owner-occupier investors was actually an input tax—which is a strange way of thinking about it—rather than taxable. I had a bit of a look at that. I do not profess to be an expert on tax, but I thought it was a very strange decision. The schedule amends what we call the GST act—or, to use its full title, A New Tax System (Goods and Services Tax) Act 1999—providing that a wholesale supply of residential premises is disregarded in certain circumstances for the purposes of determining whether a subsequent supply of a premise is the supply of new residential premise and thus taxable. There are additional changes that are made, but I will not go through them now.

The listing of deductible gift recipient status is also covered. A number of people on both sides of the political aisle have had the benefit of Rhodes scholarships. I understand the Leader of the Opposition was one. My good friend—and I was his campaign director—former Queensland Treasurer the Hon. David Hamill was also a Rhodes scholar. So we are listing here the Rhodes Trust in Australia to allow Australians who donate to the appeal to claim a deduction for the donation. There are some other miscellaneous changes, which I will not go into.

Schedule 1 is what I really want to focus on, because it is part of the package of superannuation that will make a difference, particularly in my electorate. As we know, a lot of people lose their super. By that, I do not mean that they put it away under the bed and cannot find it; they actually lose their super because they chop and change the businesses they work for. Then they forget they have it or they do not know about it and it is not pressing on their minds. The Australian Taxation Office runs a system that makes it easier and simpler for superannuation members and retirement savings account holders to consolidate their benefits. This scheme will introduce an electronic portability form that will make it easier for account holders and fund members to report funds as lost.

Just to show how significant lost superannuation is, at 30 June 2010 there were about 5.8 million lost superannuation accounts in Australia, with an accumulated balance of $18.8 billion. The then Assistant Treasurer in his second reading speech on this bill, on 23 November 2011, made the point that by 30 June 2011—a year later—that balance had increased to $20.2 billion. We just cannot keep going like that; that is money that belongs to Australians and that will help them in their retirement.

In my electorate alone, which covers the majority of Ipswich and the Somerset region, there is about $80 million waiting to be found by residents. That is according to the Australian Taxation Office. There are about 21,500 accounts that are, effectively, lost. I urge all residents in my electorate to use the SuperSeeker hotline during business hours—132 865—or go to the ATO superannuation website, www.ato.gov.au/super, because this is money that can be used. We are talking about lots of money. The average amount of lost super is about $3,500, invested over a 20-year period that would equate to about $12,500 that could be spent in retirement. That is a lot of money that could go towards a holiday after many years of work; that could go towards the purchase of a new car that someone might need in their retirement—it might be the last good car they actually buy; or that might be extra money spent for grandkids. It is a lot of money. So helping people find their lost superannuation is an important thing.

We on this side are very committed to making sure that people live in dignity and have financial security in retirement. That is why we are increasing the superannuation guarantee from nine per cent to 12 per cent.

Opposition members interjecting

Mr NEUMANN: I notice that those opposite have, of course, not supported that. That is a sad thing, because we are talking about a 30-year-old person having $108,000 more in superannuation when they retire. Just for the benefit of the member for Moncrieff, who is in the chamber, 43,500 people in my electorate will benefit from the increase in the superannuation guarantee from nine percent to 12 percent. I daresay that a similar number of people in his electorate will benefit. It is tragic that he did not support that legislation.

In March 2011, there was $1.36 trillion invested in superannuation. The market fluctuates, we know, but over the long term superannuation has delivered a very healthy return for investors and for Australians. That is a creation of a federal Labor government, because it is only we on this side of the chamber who are committed to doing that.

Increasing compulsory superannuation will benefit the retirement savings of all Australians. We think that is a particularly important thing, just as we think about the reforms associated with that legislation, like benefiting the 10,700 small businesses in my electorate that will benefit from the cut in the company tax rate. So there are a lot of important things that we are doing: superannuation, in terms of low-income earners—23,600 residents in Blair will get extra superannuation contributions. This government is adding to the superannuation nest eggs of people in my community as well as across the country. Schedule 1 of this legislation is about making sure that the people of Blair, and the people of Australia, get the benefit of the portability of superannuation, making sure they do not lose their superannuation, making sure they live their retirement with dignity and respect.

We are committed, on this side of the chamber, to high-skilled, good wages. And we are committed on this side of the chamber to small business. We are committed by reducing the company tax rate. We are committed by investing in infrastructure, in skills and in training. We have done that; those opposite have not.

It is almost a road to Damascus conversion experience from those opposite—actually now supporting good pieces of legislation, reforming the tax system and reforming superannuation. And if, like Saint Paul on the road to Damascus, this is when they have seen the light, we are very pleased and we support the legislation.