House of Representatives

Second Reading Speech

Mr Hockey (North Sydney - Minister for Financial Services and Regulation)

I move that the Bill now be read a second time.

This Bill will amend the income tax law to allow deductions for donations of $2 or more made to:

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the Community Disaster Relief (Sydney Hail Storm Assistance) Fund;

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the Australian Ex-Prisoners of War Memorial Fund;

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the Global Foundation;

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the United Hellenic Earthquake Appeal;

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the Foundation for Gambling Studies;

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the Foundation for Rural and Regional Renewal Public Fund;

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the RSL and 6th Division Australian-Hellenic Educational Memorial Fund and the Mount Macedon Memorial Cross Restoration; and

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the Development and Maintenance Trust Fund.

In addition this Bill will amend the Pay As You Go (PAYG) instalments regime to:

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simplify the way beneficiaries who are absolutely entitled to the assets of a trust and beneficiaries of certain investment trusts work out their instalment income; and

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minimise the compliance burden on the trustees of those trusts

while maintaining the PAYG instalments base.

The Bill proposes amendments to the Income Tax Assessment Act 1997, the Income Tax (Transitional Provisions) Act 1997 and the Income Tax Assessment Act 1936 by correcting unintended consequences made by the rewrite of the provisions of the Income Tax Assessment Act 1936 resulting from the Tax Law Improvement Act (No. 1) 1998. In addition, some minor amendments will also be made to the readability of those rewritten provisions.

The amendments will, generally, apply to assessments for the 1998-99 income year and later income years.

The Bill also proposes amendments to the Income Tax Assessment Act 1997:

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to ensure that the integrity measures relating to the CGT general discount operate more appropriately; and

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to clarify and ensure that the provisions concerning the CGT small business concessions have the intended consequences.

The amendments will apply to CGT events occurring after 11.45 am AEST on 21 September 1999.

There is a minor technical amendment in the Bill that replaces an incorrect reference to 'foreign public official' with 'public official' in the section that deals with non-deductibility of bribes to public officials.

Full details of the measures in this Bill are contained in the explanatory memorandum.

I commend the Bill and present the explanatory memorandum.