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Thursday, 14 May 1987
Page: 3203

Mr ROCHER(1.54) —With the ready and almost fawning compliance of a media which is largely well and truly managed by the Prime Minister (Mr Hawke) and his office, we hear repeated calls for the Liberal Party to publish its tax policy. These inanities are repeated parrot fashion by the Government and the more naive on its back bench. I compliment the honourable member for Calare (Mr Simmons), who has just resumed his seat, because he did not do as previous speakers have done in this connection.

Madam Speaker, I remind the House that when the present Prime Minister called the premature 1984 general election and subsequently announced his party's election policies, not one word was mentioned about taxation-not one word. We all know that there is one rule for the Prime Minister and another for the rest of us, but even the conveniently short memories of the media and the Labor Party's acolytes should be given an occasional jog. The simple fact is that we will announce our policies at a time to suit ourselves and, in so doing, will distinguish the Liberal Party from government supporters in that we will have a published policy whereas in 1984 they did not but seek now conveniently to forget that very simple and straightforward truth. In fact, if we are to discuss policies, we can go back to the days of the accord. Honourable members will recall that the Labor Party, whose members now form the Government, could not announce its agreement with the trade union movement until a deal had been done to knife the then leader of the Party, chop him off at the legs, and install the present Prime Minister in his stead.

Some of the practical effects of these Bills will give new life to that old gag which lampoons the role of democratic government. Most of us remember it and have been known laughingly to repeat it on different occasions: `I am from the Government; I am here to help'. The claim is made by the Treasurer (Mr Keating), with some justification, that the dividend imputation system which he seeks to entrench by way of the legislation now before the House will be in several ways helpful but that is not all that there is to it. The first strong impression to be gained about the dividend imputation provisions is that the requirements are enormously complex. Experience of complex tax laws has taught us one clear lesson. It is that tax minimisation schemes have a direct relationship to the number of relevant words in the Act. This legislation seems to have all the potential for providing a repetition of the history of the tax minimisation schemes. Although the Government made its decision to adopt dividend imputation for tax purposes as long ago as September 1985, only now, some 19 months later, has the legislative backing for it been given the light of day. Even this extraordinary gestation period has not facilitated the birth of simple, straightforward legislation, the understanding of which has been complicated by interim statements on the part of the Treasurer modifying his originally stated intention. The practice of legislating tax changes by Press statement is a well entrenched technique under this Treasurer, one that has deplorable effect on commercial endeavour. The Treasurer's procrastination has not produced the desirable degree of precision. In that regard we see shades of capital gains and fringe benefits laws which, as recent history has shown, will need amendment because of so-called `unintended consequences'.

While the big winners under this legislation should be corporate investors, some improvement will accrue to individual shareholders. The receipt by individuals of dividend income which is almost tax free in their hands will give them psychological satisfaction if nothing else. In cases where individual taxpayers endure the top marginal rate of 49 per cent after 1 July, the imputation tax rebate could mean that further tax will not be payable on the licitly franked amount of dividends received. In the event that other individuals may be assessable at marginal rates of less than 49 per cent, an excess tax rate is created and this may be offset against tax otherwise payable on other income. If we take the case of an individual whose only dividend income is a fully franked $5,000, the accompanying imputation credits could enable that person to receive an additional tax free income of as much as $12,200.

Madam SPEAKER —Order! It being 2 p.m., the debate is interrupted in accordance with sessional order 101a. The debate may be resumed at a later hour. The honourable member for Curtin will have leave to continue his speech when the debate is resumed.