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Wednesday, 23 March 1994
Page: 2107

Senator WATSON (5.48 p.m.) —The amendment put forward by Senator Coulter has some attractiveness but before the opposition would agree to the proposal he put forward in the amendment, there are some down sides that I do not think have been fully appreciated. They are the capital gains tax consequences that I believe may well flow as a result of the amendments put before the Senate this afternoon.

  As a result of this amendment there could be a change in ownership. That would bring to account the value of the property at marketable value. The cost base on which we will be entitled to a deduction under section 78 may be very low in some circumstances. Hence, in some circumstances there may be quite a horrific capital gains tax as a result of the differential between the market value following disposal of the property and the cost base which we are allowed for reduction purposes. I would like advice, not necessarily today, on the wider ramifications of the proposal in Senator Coulter's amendment.

  I would hate to impose a burden on the generosity of certain individuals who make donations if they suddenly find that they may not have the cash resources to meet the capital gains tax and the unintended consequences that could flow from Senator Coulter's amendment. I believe the issue needs some further consideration. For that reason the opposition will not be agreeing to the amendment.