House of Representatives

Second Reading Speech

Mr SLIPPER (Fisher - Parliamentary Secretary to the Minister for Finance and Administration)

I move:

That the bill be now read a second time.

Taxation Laws Amendment (Superannuation Contributions) Bill 2000 will improve the integrity and fairness of Australia's taxation system. The government announced on 30 June 2000 that it would proceed to legislate in relation to aggressive tax planning schemes involving superannuation.

These schemes attempt to undermine the law by claiming far greater concessions than were originally intended by parliament. This bill will prevent individuals reducing their taxable income by entering such schemes.

Firstly, the bill will defeat abuse of controlling interest superannuation schemes by clarifying the definition of eligible employee. The bill clarifies where an employer is able to claim a deduction. In particular, personal contributions are not deductible through the provisions concerning employer deductions. This does not introduce a change in the meaning of the legislation but expresses more clearly what has always been the effect of the legislation.

Secondly, the bill will defeat abuse of offshore superannuation schemes by removing the deduction for contributions made to non-complying superannuation funds-superannuation contributions will only be deductible if made to a complying superannuation fund, to be used for retirement income purposes, rather than in tax schemes attempting to achieve a complete tax wipe-out.

Lastly, the bill will include amendments to ensure that only superannuation contributions made on behalf of an employee are excluded from fringe benefits tax.

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

I commend the bill and present the explanatory memorandum.

Debate (on motion by Mr Leo McLeay) adjourned.