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Costello running out of excuses on golden handshakes.



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Media Release

BOB McMULLAN MP SHADOW TREASURER SHADOW MINISTER FOR THE ARTS

MEMBER FOR FRASER

9 March 2003

COSTELLO RUNNING OUT OF EXCUSES ON GOLDEN HANDSHAKES

There are mounting precedents for Treasurer Peter Costello to stop the taxpayer subsidy for excessive corporate golden handshakes. But still Mr Costello won’t act.

The government is threatening health funds with the removal of crucial tax benefits if they do not rein in excessive corporate payouts. But still Mr Costello won’t act.

Mr Costello has presided for seven years over tax laws that prohibit tax deductibility for excessive corporate superannuation contributions. When this was raised in parliament he didn’t seem to know about it. Now he has been informed, why won’t he act to extend the precedent to excessive corporate golden handshakes?

Among other expenses not allowed as deductions are entertainment, expenses for corporate yachts and corporate club memberships.

The figures below show taxpayers have subsidised the most notorious recent corporate handouts by $49.9 million. A comprehensive analysis would undoubtedly show that the full subsidy has been even greater.

Now that the Treasurer has admitted there are precedents for limiting tax deductions for some business payments he should stop delaying and act.

WHO COMPANY AMOUNT TAX DEDUCTION

Chris Cuffe Colonial First State $32.8 m $9.8 m

Brian Gilbertson BHP Billiton $30 m (estimated) $9 m

Paul Batchelor AMP $20 m (estimated) $6 m

Steve Jones Suncorp Metway $20 m (incl $16m options) $6 m

Paul Anderson BHP $18.4 m $5.5 m

George Trumbull AMP $13.2 m $4.0 m

Dennis Eck Coles Myer $8.6 m $2.6 m

John Fletcher Brambles $7.7 m $2.3 m

David Higgins Lend Lease $6.7 m $2 m

Tom Fraser AMP's UK arm $4.7 m $1.4 m

Keith Lambert Southcorp $4.4 m $1.3 m

Total $166.5 m $49.9 m

Further information: Robert Garran (02) 6277 4803, 0419 692 504

TELEPHONE: (02) 6277 4803 ã FACSIMILE: (02) 6277 8496