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Wednesday, 6 November 1985
Page: 1682

Senator Button —Senator Brownhill asked me, without notice, on 14 October 1985 (Hansard, page 1135) for information on changes in the Bicentennial unit of the Department of the Prime Minister and Cabinet. I indicated in my reply that the only major change that had taken place since December 1984 was the recently announced expansion of the Branch to a Division, but that I would have this information checked.

The Prime Minister has confirmed the information I have given. Changes between December 1984 and October 1985 have been of a minor nature. Five officers were transferred to the Department of the Prime Minister and Cabinet. The number of officers was gradually built up to nine at the end of September 1985. This included a Senior Executive Service officer in January 1985 and an additional Class 11 officer in September 1985.


Senator Walsh —Senator Siddons asked me a question, without notice, on 19 September 1985 (Hansard, page 749) concerning the tax treatment of employee share acquisition schemes and how they relate to present taxation law. I responded that I would refer the matter to the Treasurer and he has provided the following response:

The Government is well aware of the argument that productivity and industrial harmony would be enhanced by employee share acquisition schemes that encouraged the closer involvement of workers in the fortunes of the companies employing them. For some years, companies have claimed that current taxation arrangements, namely the operation of section 26AAC of the Income Tax Assessment Act, discriminate against and penalise employee share acquisition schemes. The former Government proposed exempting from income tax certain benefits to employees under approved employee share acquisition schemes but did not introduce legislation to give effect to its proposal.

This Government referred to proposal for detailed consideration by the Employee Participation Committee of the National Labour Consultative Council. In May 1984, the Government announced that it had decided not to proceed with the former Government's scheme. This decision was based on the ground that the Government did not wish to promote inequities in the tax system through a favoured tax treatment of fringe benefits. It was considered that the existing tax arrangements correctly regard the benefits of such schemes as being as much a part of the total remuneration of employees as wage and salary income. The retention of section 26AAC of the Income Tax Assessment Act is of course, complementary to the proposals in my Statement to Parliament, on 19 September 1985, to tax other forms of non-cash fringe benefits.'