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Wednesday, 13 November 1985
Page: 2071


Senator PARER —Will the Minister representing the Treasurer advise whether traditional Christmas picnics or parties provided by employers for their employees, their spouses and children, will be tax deductible to employers under the Government's tax package?


Senator WALSH —I have not seen any piece of paper which specifically refers to the Christmas picnic but, consistent with the general principles laid down in the Treasurer's statement, I expect that it would not be tax deductible. I will, however, refer the question to the Treasurer for a definitive answer. The reason, of course, is this: Who will decide what is a legitimate, ordinary Christmas picnic for the kids and what is an indulgence for a large group of other people? The practical reality is that it is impossible, without employing a vast army of bureaucrats, to make that sort of distinction. A vast army of bureaucrats, incidentally, would probably harass business in making these distinctions and in trying to make that determination to the point where business would be squealing about the army of bureaucrats. I know that the Opposition has a policy, at least in some areas, of padding bureaucratic armies. It is demonstrating that before the Senate today. It is moving to disallow the Government's regulation on freedom of information, thereby increasing the staff requirement of the Commonwealth Public Service for that reason alone by 100 people. The Government did consider, on an administrative or commissioners discretion basis, separating that small component of the total amount claimed under entertainment expenses which is legitimately attributable to expenditure relating to the earning of income. The Government made the decision that, if it were administratively possible at all-some people would question that-it would require vast bureaucratic resources and vast expense. For that reason the Government decided against it.