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Thursday, 26 March 1998
Page: 1667

Mr COSTELLO (Treasurer) (10:43 AM) —Mr Deputy Speaker, if you are allowing the debate to go wide, I will reply to each of the points. The first point is that the Deputy Leader of the Opposition (Mr Gareth Evans) says that the definition is narrower than the Labor Party wanted but is too wide. What a proposition! It is narrower than the Labor Party wanted but still too wide. You merely have to state the proposition to realise how bizarre the claim is. It is too wide, even though we narrowed it on what the Labor Party wanted. It is really a false proposition and hardly worth replying to in the House of Representatives.

The second point he makes—I do not know whether he understands it or whether it is an attempt to make a trick point—is that non-beneficiaries can now inject income into trusts. He means to say that a family can inject income into the trust if that income is another trust income, but it still has to be the family. You still have to have the same family. If the same family has income in another family trust, that trust can inject into the loss trust, or if it has it in some other mechanism.

It is true that the original proposal only allowed it for individuals. That is why it was wrong. Let us take the family that has one trust conducting one business and another conducting the other. It should be able to set off the income against the loss, just as an individual should be able to set the income off against the loss. It is a point that you have never been able to grasp, regardless of the structure.

If the family is conducting two businesses, or even one business, through two entities, you should be able to group the losses and the income. That is entirely what the legislation does. If you had thought about it for a moment instead of trying to make these cheap, ignorant points, you would have conceded it.

The third point is in relation to the income and the revenue. When the revenues were announced as a measure—that is, a change on a previous policy—the effect of the change was to increase the revenue take. That is what we always do in budgets in relation to measures. It is the conclusive answer to this totally fabricated and weak point.