Senator COLBECK (Parliamentary Secretary to the Minister for Finance and Administration) (9:56 PM) —I would like to thank senators who have taken part in the debate. I will hopefully get my comments sorted out before 10 o’clock, although we will be back tomorrow to complete this by the look of things now. I will try to be brief. The Tax Laws Amendment (Small Business) Bill 2007 amends the law to make it simpler for up to two million Australian businesses to determine their eligibility for a wide range of small business tax concessions. The bill also delivers on a number of the government’s 2006-07 budget measures. The measures in this bill demonstrate the government’s ongoing commitment to reducing red tape and compliance costs for small business.

Schedule 1 of the Tax Laws Amendment (2007 Measures No. 3) Bill 2007 amends the tax integrity rules concerning private company distributions to reduce the overly punitive nature of the existing provisions and to reduce the extent to which taxpayers can inadvertently trigger a deemed dividend. Schedule 2 will ensure that certain superannuation contributions made during the period of 8 December 2006 to 30 Jan 2007, such as those made by a friend, are included in the non-concessional contributions cap calculation that covers that period. Schedule 3 will improve the taxation of Australian resident testamentary trusts by ensuring that an income beneficiary of such a trust need not be assessed on capital gains of a trust from which they will not benefit. Schedule 4 will allow nondependants of a member of the Australian Defence Force or any Australian police force or protective service killed in the line of duty to access the same concessional tax treatment for lump sum superannuation death benefits as dependants. Schedule 5 will extend an existing transitional period under the thin capitalisation rules by one year to enable a thorough assessment of the impact of the thin capitalisation rules of adopting Australian equivalents to international financial reporting standards. Schedule 6 of this bill will reduce the compliance costs for companies by repealing the dividend tainting rules, which are no longer necessary following the introduction of the consolidation regime and simplified imputation system. Schedule 7 of this bill clarifies the existing interest withholding tax exemptions by more closely specifying the types of financial instruments that will be eligible for the exemption. Schedule 8 inserts new rules to ensure that investment in forestry managed investment schemes is encouraged to facilitate the continued expansion of our plantation forestry estate. Schedule 9 makes amendments to require Australian trustees to collect tax on trust taxable income payable to the trustee of a foreign trust. Schedule 10 of this bill enables Australian managed funds to collect a non-final withholding at a single rate, the company tax rate, on distributions of Australian source income to nonresidents that are not dividends, interest or royalties.

I commend the comments of the previous speaker on the opposition amendment. I again thank those who have participated in the debate and commend the bill to the Senate.

Question negatived.

Original question agreed to.

Bills read a second time.