Explanatory Memorandum
(Circulated by the authority of the Treasurer, the Hon J. B. Hockey MP)Chapter 4 - Deductible gift recipients
Outline of chapter
4.1 Schedule 4 to this Bill amends the Income Tax Assessment Act 1997 (ITAA 1997) to update the list of specifically listed deductible gift recipients (DGRs).
Context of amendments
4.2 The income tax law allows income tax deductions for taxpayers who make gifts of two dollars or more to DGRs. To be a DGR, an entity must fall within one of the general categories set out in Division 30 of the ITAA 1997 or be specifically listed by name in that Division.
4.3 DGR status helps eligible entities and funds attract public financial support for their activities.
Summary of new law
4.4 The amendments add Australian Schools Plus Ltd, East African Fund and The Minderoo Foundation Trust as specifically listed DGRs.
Detailed explanation of new law
Australian Schools Plus Ltd (ABN 65 164 622 459)
4.5 Taxpayers may claim a tax deduction for gifts made to Australian Schools Plus Ltd on or after 1 July 2014. [Schedule 4, item 1, item 2.2.43 in the table in subsection 30-25(2) of the ITAA 1997]
4.6 Australian Schools Plus promotes the education of students in schools facing disadvantage. Its primary purpose is to collect tax deductible donations from members of the public and distribute them to disadvantaged schools.
East African Fund (ABN 86 966 180 821)
4.7 Taxpayers may claim a tax deduction for gifts made to the East African Fund on or after 1 July 2014. [Schedule 4, item 2, item 9.2.15 in the table in subsection 30-80(2) of the ITAA 1997]
4.8 The East African Fund promotes the education of children in rural communities in East Africa. It also runs the School of St Jude which educates children in the Arusha region of Tanzania.
The Minderoo Foundation Trust (ABN 24 819 440 618)
4.9 Taxpayers may claim a tax deduction for gifts made to The Minderoo Foundation Trust on or after 1 January 2014. [Schedule 4, item 3 , item 13.2.21 in the table in section 30-105 of the ITAA 1997]
4.10 The main objects of the Trust are advancing Indigenous and disadvantaged Australians. The Minderoo Foundation Trust can also promote any purpose which is charitable at law as approved by the Australian Charities and Not-for-profits Commission or the Commissioner of Taxation.
4.11 The specific listing of The Minderoo Foundation Trust is subject to the Trust not accepting tax deductible gifts for the purposes of primary or secondary education, childcare or religion unless the relevant activities would be deductible under one or more of the general DGR categories.
Consequential amendments
4.12 The amendments also update the index in Division 30 of the ITAA 1997 to add the new listings. [Schedule 4, items 4 to 6, section 30-315 of the ITAA 1997]
Application and transitional provisions
4.13 The listing of The Minderoo Foundation Trust applies to gifts made on or after 1 January 2014.
4.14 The listing of Australian Schools Plus Ltd applies to gifts made on or after 1 April 2014.
4.15 The listing of the East African Fund applies to gifts made on or after 1 July 2014.
4.16 These amendments commence on Royal Assent.
STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 Deductible gift recipients
4.17 This Schedule is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview
4.18 Schedule 4 to this Bill amends the Income Tax Assessment Act 1997 to update the list of specifically listed deductible gift recipients.
Human rights implications
4.19 This Schedule does not engage any of the applicable rights or freedoms.
Conclusion
4.20 This Schedule is compatible with human rights as it does not raise any human rights issues.