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Thursday, 4 March 2004
Page: 25993

Mrs MOYLAN (12:05 PM) —The Tax Laws Amendment (2004 Measures No. 1) Bill 2004 incorporates a number of taxation measures, as has already been outlined by the minister and by my colleague just now. Some of these measures do involve charities and will be beneficial. Today I want to concentrate a bit on the Myer report, because it was the Myer report that was the catalyst for the amendment with respect to deductions for contributions relating to fundraising events.

I am pleased that the government has agreed to make this change, because it will encourage philanthropy by addressing community concerns regarding fundraising. The amendment addresses issues raised by the Report of the contemporary visual arts and craft inquiry—the Myer report. This was a report into the contemporary visual arts and crafts sector. I have a particular interest and passion for the arts, so I want to focus on that a little today.

I believe the arts are a reflection of our society and, in a large measure, define and continue to forge our unique Australian identity. I see the arts as having a very special place in our society, and this should be acknowledged and recognised in this House. The measures in this bill begin to recognise that as well. For a country that has a small population base, our outstanding reputation both domestically and internationally in all forms of the arts is remarkable. The arts really deserve to be supported. That is not to say they should not be encouraged to stand on their own two feet. In summing up, in the chairman's report on this inquiry, Rupert Myer said:

In reflecting upon the value of this sector, it is appropriate to be mindful that economic value and cultural value are two distinct concepts. Culture will be seriously misunderstood if analysed only as economic value. Whilst there is little question the data discussed in this Report confirms that this sector makes a significant and, importantly, strategic contribution to the nation's economy, it is its cultural contribution which is paramount. At the heart of the strategic interventions proposed in this report is a desire to promote a greater recognition of the value of the contemporary visual arts and craft sector and of artists in our community.

The cultural values of the arts were expressed in this parliament late last year by the President of the People's Republic of China, President Hu Jintao, when he said:

Cultural exchanges have long served as important bridges for enhanced understanding and deepened friendship between our two peoples.

He went on to remind us of the exchanges in the arts that took place during the celebration of the 30th year of diplomatic relations between our countries and Celebrate Australia 2002, which delighted Shanghai citizens, and the Chinese performing artists that had their debut in the famous Sydney Opera House. President Hu said that these exchanges had a fuller role to play as the bridge and bond in building friendship between our countries and people.

Who can deny that, when language and cultural differences throw up seemingly impenetrable barriers to understanding, they can very easily be broken down through music, dance, theatre, visual arts and craft. I agree with Rupert Myer that we must look beyond the economic value and recognise the cultural benefits that bind and bring people together, both within our local communities and internationally.

At home, according to the survey by the Australian Bureau of Statistics of the 12 months to April 1999, almost 3.2 million Australians—or 21 per cent of Australian adults—attended an art gallery; three million attended a museum; 3.8 million attended popular music performances; and almost 10 million attended cinemas. An Australia Council survey found that 31 per cent of respondents had visited a contemporary visual arts or craft venue in the previous two years. According to the report:

The terms of reference required the Inquiry to examine the role of governments, across the three tiers, in supporting the contemporary visual arts and craft sector, and the effectiveness of this support in achieving cultural objectives for both individual artists and arts organisations. The inquiry has estimated from data collected that support from all governments for the sector totalled $58 million in 99/2000. Support increased by about 12% over the period from 1994. The total value of the Commonwealth support for the contemporary visual arts and craft sector in 99/2000 was about $18.3 million.

This is quite a respectable investment by government on behalf of taxpayers. However, the report went on to say:

Only a small proportion of philanthropic donations and sponsorship funding is directed towards the visual arts and craft. An even smaller percentage of the funding for visual arts and craft is directed towards contemporary visual arts, and a smaller percentage again is directed to supporting contemporary craft. The inquiry believes that a modest amount of additional support would have a demonstrable and significant impact ...

The report then went on to discuss ways to improve incentives for philanthropy, which gets to the heart of this amendment. The report said:

The inquiry believes a stimulus to philanthropy in the contemporary visual arts and craft sector is needed and it should take the form of higher tax incentives ...

The chairman, in the preamble to the report, reminded us of the benefits that accrued to the country from the film industry when he said:

In imagining the future, it is relevant to consider the development of the Australian film industry, particularly over the last decade. After many years of strategic investment and planning, that industry is reaping the benefits of a healthy slate of local feature films, television drama and other productions.

I recently had the pleasure of going to a preview of the new Australian film Peaches which was arranged by our minister for the arts, Senator the Hon. Rod Kemp. We can be really proud of our continually high level of production and the performances of our local actors. We can also feel very pleased that the government continues to support such entities as Film Finance Corporation Australia—which is resourced to assist the production of such films—and that the federal government continues to provide the refundable tax film offsets. That helps us to keep drawing back such talented Australian actors as Hugo Weaving, who takes the lead in this particular film, and to develop new Australian talent, which we saw in the two supporting roles in the film. Rupert Myer went on to say:

Few now question the value of the public investment that has supported and continues to support this creative industry. We celebrate the success of both the industry and the individuals whose roles have contributed to the essence of our nation's culture ... they emphasise the importance of their professional training, access to opportunities to display their talents and the role of publicly funded investment as the key elements of this industry's development. The associated activity, tourism developments and the nurturing of our nation's creative talents are widely discussed. The key to these observations are relevant across the whole of the creative arts sector.

... ... ...

With well targeted cooperative public investment and a supportive legislative environment, the contemporary visual arts and craft sector can move rapidly to consolidate its current position and further evolve to become bolder and more inventive ...

The Myer report has set a very high standard, and it is invaluable to guide government as to future taxation measures that will continue to build on the amendment in this bill to encourage philanthropy in the arts. I understand that both the minister for the arts and the Assistant Treasurer continue to discuss and examine the options outlined in the Myer report, and I know that the Board of Taxation is also considering some measures at present. From my perspective, this is an important aspect of this amendment.

I will touch on a couple of other aspects of the bill without going into great detail. Another important amendment—the medical expenses tax offset measure—is designed to ensure that benefits that are currently available to blind people for guide dogs will be extended to assist people who have other disabilities. This is a small move. It does not involve a lot of people but it is very important because, under the existing law, only people who are blind can benefit from a tax offset to expenses for guide dogs. Under these provisions the list of eligible medical expenses will include payments made in maintaining a properly trained dog for guiding or assisting people with other types of disabilities.

The measure will affect about 200 people. It is not a lot of people, but they are an important group within our community and we can be measured to some large degree on our compassion for these quite small groups within the community who get on with life despite their disabilities and do some amazing things. I think it is great that they will be able to claim expenses offsets for hearing dogs and service or assistance dogs. This amendment will be very welcome, I am sure, to the estimated 200 people who currently depend on these dogs so that they can get on with their lives and live more independently. The measure also incorporates the deduction for transport between workplaces, which basically provides greater clarity to the existing law.

The small business capital gains tax relief and discretionary trusts measure ensures that small businesses will continue to include charities as beneficiaries. The Howard government set out soon after taking office to strengthen and encourage philanthropy. The contribution made by many businesses underpins numerous charitable organisations within our community. These amendments have been recommended by industry to ensure that the many small businesses that operate through discretionary trusts and include charitable organisations as beneficiaries are not prevented from accessing the capital gains tax concessions.

There is a technical correction to the Energy Grants Credits Scheme transitional arrangements. The measures involving net input tax credits and capital gains tax ensure that the goods and services tax which is later recovered does not count as part of the cost of an asset when calculating capital gains tax. The measures regarding the confidentiality of Australian business number information clarify the circumstances under which the registrar of the Australian Business Register can disclose ABN information to Commonwealth, state and territory agencies and department heads.

Other measures in the bill include amendments to the distribution of certain entities, addressing problems identified by the Board of Taxation in its report Taxation of discretionary trusts. The bill also deals with the deduction for dividends that are on-paid to non-resident owners, which amends an anomaly in relation to resident companies deducting payments of certain unfranked dividends to their wholly owned foreign parent. Finally, there is the endorsement of charities to access tax concessions, which will require charities, public benevolent institutions and health promotion charities to be endorsed by the Commissioner of Taxation before they can access relevant taxation concessions.

As I said, many of these measures are beneficial to charitable organisations and to others in the community, and I strongly support these measures. I look forward to seeing the Assistant Treasurer and the minister for the arts working together closely to continue to encourage philanthropy within the arts, particularly within the contemporary arts sector, as outlined in the excellent inquiry chaired by Mr Myer. I thank the House.