Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
 Download Full Day's HansardDownload Full Day's Hansard    View Or Save XMLView/Save XML

Previous Fragment    Next Fragment
Wednesday, 20 August 1980
Page: 485

Mr WILLIS (GELLIBRAND, VICTORIA) - I refer the Treasurer to last night's Budget announcement of substantial tax deductions for contributions by self-employed persons to superannuation funds. I also remind him again of the widespread use of internal superannuation schemes to avoid tax, which schemes he continues to allow to operate. In view of the open use of this type of scheme, has the Treasurer considered the implications of last night's announcement for increased tax avoidance? Does he realise that it will now be a profitable exercise for an enterprising accountant to set up a superannuation fund for a group of selfemployed persons who would gain substantial tax benefits for contributions which then could be loaned back to them at low interest for their own tax free enjoyment? Does the Treasurer plan to implement any safeguards against this abuse?

Mr HOWARD (BENNELONG, NEW SOUTH WALES) (Treasurer) - The honourable member for Gellibrand gives me the opportunity to say that the Government regards this measure as one of the most important free enterprise initiatives in the taxation area that it has taken for a long time. We all know the record of the Australian Labor Party when it comes to acting against tax avoidance. So let us not start talking about--

Opposition members interjecting -

Mr HOWARD - Only last weekend the Leader of the Opposition, running around the country promising something to every group to which he spoke, said he would wipe out from the Income Tax Assessment Act that section which taxes the provision of benefits in kind rather than in cash and wages. He knows what sorts of loopholes would open up if that section were taken out of the Act. He ought to know that the people who would bear the burden of that would be the ordinary wage and salary earners of Australia whom he claims to represent so effectively. If I may return to the question asked by the honourable member for Gellibrand -

Mr SPEAKER - The Treasurer may return to it.

Mr HOWARD - Thank you very much, Mr Speaker. The measure that the Government announced last night is not only of benefit to selfemployed people but also is of benefit to employed persons who are not already covered by employer sponsored schemes. In other words, it is totally even-handed and I believe a very important measure. I can assure the honourable member for Gellibrand that the Government will be very anxious to see that these provisions are not exploited. We will be very anxious to see that the proposed legislative provisions are effective so as to prevent any abuses. I will, of course, be ready to examine and discuss with the honourable member for Gellibrand any proposals that he might put to me in terms of effective safeguards against tax avoidance, provided that in the process they do not unfairly and unnecessarily impede normal and proper commercial arrangements.

Suggest corrections