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Thursday, 21 May 1936

Senator A J McLACHLAN (SOUTH AUSTRALIA) (Postmaster-General) . - The complaint of the honorable senator is directed against what he considers to be the severity of the administration of this and complementary clauses. When a person desires to leave Australia, he may apply to the Commissioner to issue a certificate first, that he is not liable to pay income tax. If all the demands of the Commissioner are met, the applicant obtains hiscertificate immediately.

Senator Duncan-Hughes - Without any guarantee?

Senator A J McLACHLAN (SOUTH AUSTRALIA) - Yes, if the applicant has a clean sheet no obstacle is placed in his way of obtaining the certificate. Secondly, the intending traveller can obtain a certificate when arrangements have been made to the satisfaction of the Commissioner for the payment of all income tax that is or may become payable by that person. I have known of cases in which trouble has arisen in this connexion, and it has been necessary for an intending traveller to get his bank or some financial institution to guarantee his income tax. The Commissioner has no means of ascertaining a person's financial position, unless that person is prepared to lodge securities such as Government bonds or title deeds with him. I emphasize that the arrangements are in the hands of the taxpayer himself. If some person consents to act as guarantor, surely he must accept the responsibility to the Commissioner for the payment of any assessment. Nobody is forced to be a guarantor. This is a matter of ordinary business between the intending traveller and the third party. While I oppose this amendment, which I consider would reduce the facilities of the intending traveller as well as increase the difficulties of the Commissioner, I want the committee to know that this matter has been discussed departmentally because of some complaints made regarding the cumbrous nature of the administration, and the difficulty experienced by some taxpayers in obtaining guarantors. The law as it stands is elastic, and there are several ways in which arrangements can be made to satisfy the Commissioner. I fail to follow the argument of Senator Duncan-Hughes that if the guarantee has been given by some individual, the liability on him should be limited to the amount of the value of the estate of the taxpayer. If the taxpayer has the assets, he can lodge transferable securities with the Commissioner. In other circumstances, the Commissioner acts on the good faith and integrity of the guarantor. He accepts the guarantee, and that is the only reason why he issues the certificate. The matter is being discussed by the Commissioners with a view to making the system less cumbersome, and obtaining a more direct method. It has not given rise to a great deal of trouble, but admittedly it has caused some irritation.

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