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15    Tax Laws Amendment (Combating Multinational Tax Avoidance) Bill 2015

Order read for the further consideration of message no. 494 from the House of Representatives in committee of the whole (s ee entry no. 5 ).

————

In the committee

Consideration resumed of the message— and of the motion moved by the Minister for Finance (Senator Cormann) —That the committee does not insist on its amendments to which the House has disagreed.

Debate resumed on the question—That the committee does not insist on amendment no. 1.

Amendment further debated.

Question put and passed.

Question—That the committee does not insist on amendment no. 2—

The Leader of the Australian Greens (Senator Di Natale) moved the following amendment:

At the end of the motion, add “but agrees to the following amendments in place of that amendment:

Schedule 1, page 7 (before line 10), before item 5 (after proposed item 4A), insert:

4B  After section 3C

Insert:

3CA   Reporting of information by significant global entities

     (1)   This section applies to a corporate tax entity for an income year if:

                              (a)  the entity is a significant global entity for the income year; and

                              (b)  at the end of the income year, the entity is:

                                                  (i)   an Australian resident; or

                                                 (ii)   a foreign resident who operates an Australian permanent establishment (within the meaning of Part IVA of the Income Tax Assessment Act 1936 ); and

                               (c)  the entity does not lodge a general purpose financial statement for the financial year most closely corresponding to the income year:

                                                  (i)   with the Australian Securities and Investments Commission; and

                                                 (ii)   within the time provided under subsection 319(3) of the Corporations Act 2001 for lodgement of a report for that financial year.

     (2)   A corporate tax entity to which this section applies for an income year must, on or before the day by which the entity is required to lodge its income tax return for the income year with the Commissioner, give to the Commissioner a general purpose financial statement for the financial year most closely corresponding to the income year.

Note:         Section 286-75 in Schedule 1 provides an administrative penalty for breach of this subsection.

     (3)   The Commissioner must give a copy of the statement to the Australian Securities and Investments Commission.

     (4)   The giving of the copy to the Australian Securities and Investments Commission under subsection (3) is taken, for the purposes of the Corporations Act 2001 , to be lodgement of the document with the Australian Securities and Investments Commission.

Note:         Under section 1274 of the Corporations Act 2001 , a person may inspect, and require to be given a copy or extract of, any document lodged with the Australian Securities and Investments Commission.

     (5)   For the purposes of this section, a general purpose financial statement in relation to an entity:

                              (a)  must be prepared in accordance with:

                                                  (i)   the accounting principles; or

                                                 (ii)   if accounting principles do not apply in relation to the entity—commercially accepted principles relating to accounting; and

                              (b)  if the entity is a member of a group of entities that are consolidated for accounting purposes as a single group—must relate to:

                                                  (i)   the entity; or

                                                 (ii)   the entity and some or all of the other members of the group.

     (6)   An expression used in this section that is also used in the Income Tax Assessment Act 1997 has the same meaning as in that Act.

Schedule 1 , page 7 (after line 21) , at the end of the Schedule (after proposed item 6), add:

7  Application of amendment—item 4B

The amendment made by item 4B of this Schedule applies in relation to income years commencing on or after 1 July 2016.”.

Debate ensued.

Question—That the amendment be agreed to—put.

The committee divided—

AYES, 36

Senators—

Back

Edwards

Macdonald

Ronaldson

Bernardi

Fawcett

McGrath

Ruston

Birmingham

Fierravanti-Wells

McKenzie

Ryan

Bushby

Fifield

McKim

Scullion

Canavan

Hanson-Young

Nash

Siewert

Cash

Heffernan

Parry

Simms

Colbeck

Johnston

Reynolds

Smith (Teller)

Cormann

Lindgren

Rhiannon

Whish-Wilson

Di Natale

Ludlam

Rice

Williams

 

 

NOES, 25

Senators—

Bilyk

Lambie

Marshall

Polley

Brown

Lazarus

McAllister

Singh

Cameron

Leyonhjelm

McEwen (Teller)

Urquhart

Collins

Lines

Moore

Wang

Conroy

Ludwig

Muir

Wong

Dastyari

Madigan

Peris

Xenophon

Gallagher

 

 

 

Question agreed to.

Main question, as amended, put and passed.

Question—That the committee does not insist on amendment no. 3—

Senator Dastyari moved the following amendment:

At the end of the motion, add “but agrees to the following amendment in place of that amendment:

Page 17 (after line 3), at the end of the bill, add:

Schedule 5 Reporting of information about corporate tax entities

Taxation Administration Act 1953

1  Subsection 3C(1)

Repeal the subsection, substitute:

     (1)   This section applies to an entity if:

                              (a)  the entity is a corporate tax entity (within the meaning of the Income Tax Assessment Act 1997 ); and

                              (b)  the entity has total income equal to or exceeding $100 million for an income year, according to information reported to the Commissioner in the entity’s income tax return (within the meaning of that Act) for the income year.

2  Subsection 3C(2)

Omit “The Commissioner”, substitute “Subject to subsection (2A), the Commissioner.

3  After subsection 3C(2)

Insert:

  (2A)   If:

                              (a)  an entity applies to the Commissioner in writi ng; and

                              (b)  at the end of the income year:

                                                  (i)   the entity is an Australian resident that is a private company for the income year; or

                                                 (ii)   the entity is not a member of a wholly-owned group that has a foreign resident ultimate holding company; or

                                                (iii)   the percentage of foreign shareholding in the entity is less than 50%; and

                               (c)  the Commissioner is satisfied that to make the information publicly available may be significantly prejudicial to any of the entity’s current or future commercial negotiat ions;

the Commissioner may determine that subsection (2) does not apply in relation to the entity. An expression used in this subsection that is also used in the Income Tax Assessment Act 1997 has the same meaning as in that Act.

  (2B)   A determination under subsection (2A) is not a legislative instrument .

4  After subsection 3C(3)

Insert:

  (3A)   The Commissioner must ensure that the information made publicly available under subsection (2) includes:

                              (a)  a statement to the effect that:

                                                  (i)   the information may not reflect the full financial position of the entity; and

                                                 (ii)   more comprehensive information may be available from the Australian Securities and Investment Commission; and

                              (b)  the address for the part of the Australian Securities and Investment Commission’s website via which the information referred to in subparagraph (a)(ii) may be found.

5  Application of amendments

The amendments made by this Schedule apply in relation to an entity for the 2013-14 income year and each later income year unless the Commissioner has, before the commencement of this Schedule, made publicly available information about the entity for the income year under subsection 3C(2) of the Taxation Administration Act 1953 .”.

Debate ensued.

Question—That the amendment be agreed to—put.

The committee divided—

AYES, 21

Senators—

Bilyk

Dastyari

Ludwig

Peris

Brown

Gallagher

Marshall

Singh

Bullock

Lambie

McAllister

Urquhart (Teller)

Cameron

Lazarus

McEwen

Wong

Collins

Lines

Moore

Xenophon

Conroy

 

 

 

NOES, 38

Senators—

Back

Fierravanti-Wells

McKenzie

Ruston

Bernardi

Fifield

McKim

Ryan

Birmingham

Hanson-Young

Nash

Scullion

Bushby

Heffernan

Parry

Siewert

Canavan

Johnston

Payne

Simms

Colbeck

Leyonhjelm

Reynolds

Smith (Teller)

Cormann

Lindgren

Rhiannon

Wang

Di Natale

Ludlam

Rice

Whish-Wilson

Edwards

Macdonald

Ronaldson

Williams

Fawcett

McGrath

 

 

 

Question negatived.

Senator Muir moved the following amendment:

At the end of the motion, add “but agrees to the following amendment in place of that amendment:

Page 17 (after line 3), at the end of the bill, add:

Schedule 5 Reporting of information about corporate tax entities

Taxation Administration Act 1953

1  Paragraphs 3C(1)(a) and (b)

Repeal the paragraphs, substitute:

                              (a)  the entity has total income equal to or exceeding $100 million for the income year and, at the end of the income year:

                                                  (i)   the entity is not an Australian resident that is a private company for the income year; or

                                                 (ii)   the entity is a member of a wholly-owned group that has a foreign resident ultimate holding company; or

                                                (iii)   the percentage of foreign shareholding in the entity is greater than 50%; or

                              (b)  the entity has total income equal to or exceeding $200 million for the income year and, at the end of the income year:

                                                  (i)   the entity is an Australian resident that is a private company for the income year; and

                                                 (ii)   the entity is a large proprietary company within the meaning of the Corporations Act 2001 .

2  After subsection 3C(3)

Insert:

  (3A)   The Commissioner must ensure that the information made publicly available under subsection (2) includes:

                              (a)  a statement to the effect that:

                                                  (i)   the information may not reflect the full financial position of the entity; and

                                                 (ii)   more comprehensive information may be available from the Australian Securities and Investments Commission; and

                              (b)  the address for the part of the Australian Securities and Investments Commission’s website via which the information referred to in subparagraph (a)(ii) may be found.

3  Application of amendments

The amendments made by this Schedule apply in relation to an entity for the 2013-14 income year and each later income year unless the Commissioner has, before the commencement of this Schedule, made publicly available information about the entity for the income year under subsection 3C(2) of the Taxation Administration Act 1953 .”.

Question—That the amendment be agreed to—put.

The committee divided—

AYES, 7

Senators—

Lambie

Leyonhjelm

Muir (Teller)

Xenophon

Lazarus

Madigan

Wang

 

 

 

NOES, 40

Senators—

Back

Di Natale

Ludwig

Rice

Bernardi

Edwards

Macdonald

Ronaldson

Bullock

Fawcett

Marshall

Ruston

Bushby

Gallagher

McAllister

Siewert

Cameron

Hanson-Young

McKenzie

Simms

Canavan

Heffernan

McKim

Singh

Colbeck

Johnston

Moore

Smith

Collins

Lindgren

Peris

Urquhart (Teller)

Cormann

Lines

Reynolds

Whish-Wilson

Dastyari

Ludlam

Rhiannon

Williams

 

 

Question negatived.

Senator Di Natale moved the following amendment:

At the end of the motion, add “but agrees to the following amendments in place of that amendment:

Schedule 1, page 7 (before line 10), before item 5, insert:

4A  Paragraphs 3C(1)(a) and (b)

Repeal the paragraphs, substitute:

                              (a)  the entity has total income equal to or exceeding $100 million for the income year and, at the end of the income year:

                                                  (i)   the entity is not an Australian resident that is a private company for the income year; or

                                                 (ii)   the entity is a member of a wholly-owned group that has a foreign resident ultimate holding company; or

                                                (iii)   the percentage of foreign shareholding in the entity is greater than 50%; or

                              (b)  the entity has total income equal to or exceeding $200 million for the income year and, at the end of the income year, the entity is an Australian resident that is a private company for the income year.

Schedule  1 , page 7 (after line 21) , at the end of the Schedule, add:

6  Application of amendment—item 4A

         The amendment made by item 4A applies in relation to an entity for the 2013-14 income year and each later income year.”.

Debate ensued.

Question—That the amendment be agreed to—put.

The committee divided—

AYES, 36

Senators—

Back

Fawcett

McGrath

Ronaldson

Birmingham

Fierravanti-Wells

McKenzie

Ruston

Brandis

Fifield

McKim

Ryan

Bushby

Hanson-Young

Nash

Scullion

Canavan

Heffernan

Parry

Siewert

Colbeck

Johnston

Payne

Simms

Cormann

Lindgren

Reynolds

Smith (Teller)

Di Natale

Ludlam

Rhiannon

Whish-Wilson

Edwards

Macdonald

Rice

Williams

 

 

NOES, 26

Senators—

Bernardi

Day

Marshall

Polley

Brown

Gallagher

McAllister

Singh

Bullock

Lambie

McEwen

Urquhart (Teller)

Cameron

Lazarus

Moore

Wang

Collins

Leyonhjelm

Muir

Wong

Conroy

Lines

Peris

Xenophon

Dastyari

Ludwig

 

 

 

Question agreed to.

Main question, as amended, put and passed.

Senator Muir moved the following amendment:

At the end of the motion, add “and makes the following further amendment to the bill:

Page 17 (after line 3), at the end of the bill, add:

Schedule 5 Transparency

Part 1 Repeal of instrument

ASIC Corporations (Exempt Proprietary Companies) Instrument 2015/840

1  The whole of the instrument

Repeal the instrument.

Part 2 Grandfather ed exemption

Corporations Act 2001

2  Subsection 1408(6) (table item 7)

Repeal the table item.

Part 3 Application

3  Application

(1)    This item applies to a company if, immediately before the commencement of this item, the company was exempted from complying with subsection 319(1) of the Corporations Act 2001 by the ASIC Corporations (Exempt Proprietary Companies ) Instrument 2015/840 .

(2)    Despite the amendments made by Parts 1 and 2, that exemption continues to apply to the company in relation to the 2015-16 financial year.”.

Debate ensued.

Question—That the amendment be agreed to—put.

The committee divided—

AYES, 25

Senators—

Bilyk

Gallagher

Madigan

Peris

Brown

Lambie

Marshall

Singh

Bullock

Lazarus

McAllister

Urquhart (Teller)

Cameron

Leyonhjelm

McEwen

Wang

Conroy

Lines

Moore

Wong

Dastyari

Ludwig

Muir

Xenophon

Gallacher

 

 

 

NOES, 36

Senators—

Back

Fawcett

McGrath

Ronaldson

Bernardi

Fierravanti-Wells

McKenzie

Ruston

Birmingham

Fifield

McKim

Ryan

Brandis

Hanson-Young

Nash

Scullion

Bushby

Heffernan

Parry

Siewert

Canavan

Johnston

Payne

Simms

Colbeck

Lindgren

Reynolds

Smith (Teller)

Di Natale

Ludlam

Rhiannon

Whish-Wilson

Edwards

Macdonald

Rice

Williams

 

 

Question negatived.

Resolution to be reported.

 

 

 

The President resumed the chair and the Chair of Committees (Senator Marshall) reported that the committee had considered message no. 494 from the House of Representatives relating to the Tax Laws Amendment (Combating Multinational Tax Avoidance) Bill 2015 and:

    (a)   had resolved not to insist on amendment no. 1 made by the Senate to which the House of Representatives had disagreed; and

    (b)   had resolved not to insist on amendments nos 2 and 3 to which the House of Representatives had disagreed, and had made amendments in place of those amendments.

On the motion of Senator Cormann the report from the committee was adopted.