House of Representatives

Explanatory Memorandum

(Circulated by authority of the Treasurer, the Hon Wayne Swan MP)

Chapter 6 - Deductible gift recipients

Outline of chapter

6.1 Schedule 6 to this Bill amends the Income Tax Assessment Act 1997 (ITAA 1997) to update the list of deductible gift recipients (DGRs) to include nine new entities and to extend the time period of DGR status of four entities.

Context of amendments

6.2 The income tax law allows taxpayers who make gifts of $2 or more to DGRs to claim income tax deductions. To be a DGR, an organisation must fall within one of the general categories set out in Division 30 of the ITAA 1997, or be listed by name under that Division.

6.3 DGR status assists eligible funds and organisations to attract public support for their activities.

Summary of new law

6.4 These amendments add nine organisations to the list of specifically listed DGRs and extend the time period for which deductions are allowed for gifts made to four organisations. Gifts of $2 or more, made to these entities within each entity's eligible time period, are tax deductible.

Detailed explanation of new law

New listings

6.5 Schedule 6 allows deductions for gifts to the organisations listed in Table 6.1. [Schedule 6, items 1, 2, 4, 5 and 8 to 10]

6.6 The AE 2 Commemorative Foundation Ltd aims to ensure that the Australian World War I submarine HMAS AE 2 , currently lying in the sea of Marmara, Turkey, is preserved and its role in the Gallipoli campaign is appropriately recognised. [Schedule 6, item 4]

6.7 Ian Thorpe's Fountain for youth Limited focuses on a range of activities such as:

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improving the health and education outcomes of children, especially Indigenous children;

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improving literacy as a step towards improving the health and life expectancy of children;

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supporting Indigenous cultural education; and

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supporting projects that help to establish or sustain viable business projects for Indigenous communities.

[Schedule 6, item 2]

6.8 Wheelchairs for Kids Incorporated manufactures and distributes wheelchairs to disabled children in many developing countries. [Schedule 6, item 8]

6.9 The Amy Gillett Foundation aims to raise awareness of cyclist safety through the use of media. This Foundation's efforts to raise awareness involve a range of communication strategies, conducting education, and funding research. [Schedule 6, item 9]

6.10 The Spirit of Australia Foundation is an educational organisation that encourages and facilitates research into, and the dissemination of, knowledge of Australian history and heritage. [Schedule 6, item 1]

6.11 The World Youth Day 2008 Trust is an international event targeted at Roman Catholic youth. World Youth Day 2008 will be held in Sydney between 15 and 20 July 2008, and is hosted by the Sydney Catholic Archdiocese. [Schedule 6, item 8]

6.12 The Memorials Development Committee Ltd is an organisation established to develop, design and construct two separate, but complementary memorials to World War I and World War II in the Anzac Parade memorials precinct of the Australian Capital Territory. [Schedule 6, item 4]

6.13 The Council for Jewish Community Security was established to assist in the provision of security and protection for members and institutions of the Australian Jewish community. [Schedule 6, item 10]

6.14 Playgroup Australia Incorporated is an organisation which works in conjunction with the eight state and territory peak playgroup bodies to promote playgroup participation for all families with young children. It advocates learning through play and supporting parents through playgroups as an integral part of the early childhood experience. [Schedule 6, item 5]

Extended listings

6.15 Schedule 6 extends the period for which deductions are allowed for gifts to the organisations listed in Table 6.2. [Schedule 6, items 3, 6, 7 and 11]

6.16 The Dunn and Lewis Youth Development Foundation was established to assist with the building of a memorial complex dedicated to two victims of the Bali bombing. The complex will provide programs to address chronic issues affecting young people. [Schedule 6, item 11]

6.17 The Finding Sydney Foundation is an organisation formed to find the cruiser HMAS Sydney and the German raider HSK Kormoran , which were sunk off the Western Australian coast in 1941. The Finding Sydney Foundation aims to ensure preservation of the war graves and to commemorate the memory with a virtual memorial. [Schedule 6, item 3]

6.18 The Xanana Vocational Education Trust aims to create a self-sustaining vocational education system in Timor-Leste. It has initially focused on making distributions to institutions in Timor-Leste such as the Dili Institute of Technology. [Schedule 6, item 7]

6.19 Australia for UNHCR (United Nations High Commissioner for Refugees) was established to raise funds in Australia for the UNHCR, and raise awareness locally about the plight of refugees. [Schedule 6, item 6]

Application and transitional provisions

6.20 These amendments to list the organisations in Tables 6.1 and 6.2 apply from the dates of effect shown in those tables. [Schedule 6, items 1 to 11]

Consequential amendments

6.21 A number of changes have been made to update the index to include the new entities. [Schedule 6, items 12 to 20]