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Monday, 13 May 1985
Page: 1793

Senator WATSON —My question is directed to the Leader of the Government in the Senate. The Minister will recall that on the PM program on Friday he said: 'I think a very simple capital gains tax is what is needed'. Does he believe that such a tax should exempt the family home, allow offsets for some capital losses and be indexed for inflation? Further, does he believe that the judicial interpretation has lessened the impact of the original legislative intention within sections 25 and 26 of the Income Tax Assessment Act? If so, do those sections now need strengthening?

Senator BUTTON —I would not be so bold as to give a legal opinion on the second part of the question.

Senator Withers —Make it simple.

Senator BUTTON —I have very few qualifications in this matter-perhaps marginally more than Senator Watson, but not many. Insofar as the first part of the question is concerned, yes, I recall saying something to that effect. However, it would be wrong for me to speculate on the precise nature of a capital gains tax.

Senator Withers —Just confiscate something.

Senator BUTTON —Well, it would have to be fairly simple for Senator Withers to understand it. All I will say is what I have said all along in relation to the specifics suggested to me by Senator Watson, that in all the other Organisation for Economic Co-operation and Development countries which have capital gains taxes provisions and exemptions of that kind are included they seem to me like pretty good ideas.