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Tuesday, 3 December 1985
Page: 2785


Senator WALSH —At Question Time Senator Colston asked me about deductions from taxable income for contributions to schools. The answer is that under section 78 of the Income Tax Assessment Act donations paid into a fund which is maintained exclusively to fund the acquisition, construction or maintenance of a building used as a school by a government, a government authority or a private non-profit association of individuals are deductible. So therefore it is available to both government and private schools. The effective tax subsidy depends on the marginal tax rate of the donor, which in the case of a company or middle rate private taxpayer would be 46 per cent, or 47 per cent if we count the Medicare levy, or in the case of someone on the highest rate 60 or 61 per cent. The provision has been in existence for many years and the Government is unaware of any basis for concern about that particular provision.