Second Reading Speech
Senator Heffernan (New South Wales - Parliamentary Secretary to Cabinet)I move:
That this bill be now read a second time.
I seek leave to have the second reading speeches incorporated in Hansard.
Leave granted.
The speech reads as follows-
TAXATION LAWS AMENDMENT (CHANGES FOR SENIOR AUSTRALIANS) BILL 2001
As part of tax reform, the Government delivered a number of benefits to pensioners and self-funded retirees. These included real increases in pensions and allowances, lower income tax rates, lower capital gains tax rates, one off, non-taxable, bonuses of up to $3000 and refunds of excess imputation credits. Tonight's budget and this Bill build on those measures which the Government has already delivered.
This Bill amends the Income Tax Assessment Act 1936 to enable a substantial increase in the tax rebates available to Senior Australians, including self-funded retirees and people who are of age pension age, and receiving a Commonwealth pension. The increase in the rebates will be achieved through an amendment to the Regulations.
The higher rebates will allow single senior Australians to derive taxable income up to $20,000 without paying income tax. This compares to $12,652 in 1999-00. Senior couples, on equal incomes, will be able to earn taxable income of $32,612 without paying income tax.
Regulations have been gazetted to allow single pensioners who are under age pension age to derive taxable income up to $15,970 in 2000-01 without paying tax. This compares to $12,652 in 1999-00.
The Bill also amends the Medicare Levy Act 1986 to ensure that senior Australians, who are entitled to the increased rebates as a result of this Bill do not have to pay the Medicare levy where their taxable income is less than $20,000.
The Bill also ensures that those Australians under age pension age and who receive a taxable Commonwealth Government pension will not have to pay the Medicare levy where their income is below $15,970.
This means that these people will be able to earn more income without incurring an income tax or Medicare levy liability.
The amendments made by this Bill apply to the 2000-01 year of income, which means that these Australians will see the benefits of these measures in a lower tax bill or a higher tax refund after they lodge their 2000-01 income tax return.
The Bill will also amend the Income Tax Assessment Act 1997 to exempt, from income tax, the `one off payment to the aged' of $300. This payment was also announced as part of the Government's 2001-02 Budget.
The increased rebates for self funded retirees and aged and other pensioners and higher Medicare levy thresholds deliver benefits amounting to around $1.5 billion over four years.
I commend this Bill.
Debate (on motion by Senator O'Brien) adjourned.
Ordered that the resumption of the debate be made an order of the day for a later hour.