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Wednesday, 27 November 1974
Page: 2837

The PRESIDENT -Is leave granted? There being no dissent, leave is granted. (The document read as follows)-

This Bill will amend the estate duty law in two substantial respects. It will provide for a deduction of up to $35,000 in the assessment of duty payable on an estate where an interest in a matrimonial home passes to a surviving spouse. It will also provide for the establishment of a board with power to release a person wholly or partly from estate duty where its exaction would cause serious hardship for a beneficiary. These 2 measures give effect to undertakings in the policy speech delivered by the Prime Minister (Mr Whitlam) on 29 April 1974.

For the proposed deduction to be available it will be necessary for the deceased person to have been domiciled in Australia immediately before his or her death and for property comprising an interest in a matrimonial home to pass to the surviving spouse. In addition to the more usual situations, shares conferring rights of occupancy of a flat or home unit used as a matrimonial home will be treated as such property. The amount of the deduction will be determined by reference to the gross value of the property disregarding any mortgage or other encumberance on it. A deduction up to the full gross value may be allowed where the value does not exceed $35,000. Where it exceeds that amount the deduction will be $35,000 less $7 for every $10 of the excess so that there will be no deduction at all where the gross value is $85,000 or more. The deduction is to be allowed in assessments of estates of persons who died on or after 30 April 1974.

Special provisions have been included in the Bill to deal with situations in which the matrimonial home was not used exclusively for that purpose and where something less than the whole of the property passes to the surviving spouse. There are also provisions to deal appropriately with such situations as where an interest in the matrimonial home has been gifted to a spouse within 3 years before death and is brought back into the estate for duty purposes as notional property. The special provisions are discussed in detail in the explanatory memorandum being made available to honourable senators and I will not elaborate on them in this introductory speech.

Like the Income Tax Relief Board, the board to be established to relieve a person from a liability to pay estate duty is to comprise the Commissioner of Taxation, the Secretary to the Treasury and the Comptroller-General of Customs or their substitutes. It will be able to grant relief only where the benefit will accrue to a beneficiary who would suffer hardship if the full amount of duty were collected. In cases involving applications for relief from duty of $2,000 or more the board will be required to refer the application to a taxation board of review or to the Chairman of the Valuation Board so that the appropriate persons can be examined regarding statements in support of the application. The Commissioner of Taxation will be authorised to deal with applications involving small amounts of $200 or less.

Other amendments contained in the Bill ensure that, where appropriate, the new deduction for the matrimonial home and any amounts for which relief has been granted are taken into account in calculating quick succession and primary producer rebates in estate duty assessments. I commend the Bill to the Senate.

Debate (on motion by Senator Cotton) adjourned.

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