WARNING:
This Digest was prepared for debate. It reflects the legislation as
introduced and does not canvass subsequent amendments. This Digest
does not have any official legal status. Other sources should be
consulted to determine the subsequent official status of the
Bill.
CONTENTS
Superannuation Contributions Surcharge Imposition Bill
1997
Date Introduced: 13 February 1997
House: House of Representatives
Portfolio: Treasury
Commencement: Royal Assent
To impose formally the surcharge payable under the
Superannuation Contributions Surcharge (Assessment and Collection)
Bill 1997.
The reader is referred to the Digest for the Superannuation
Contributions Surcharge (Assessment and Collection) Bill 1997.
Clause 4 imposes formally the surcharge payable
under the Superannuation Contributions Surcharge (Assessment and
Collection) Bill 1997.
Clause 5 deals with the rate of surcharge
payable. Where the assessable income and superannuation
contributions of a superannuation fund member is between $70 000
and $84 999 the rate of surcharge that will apply in respect of
that member in a financial year is the percentage obtained by using
the following formula:
adjusted taxable income minus $70 000 divided by $1 000 (ie. 1%
per $1 000 that adjusted taxable income exceeds $70 000)
Where the assessable income and superannuation contributions of
a superannuation fund member is over $85 000 the rate of surcharge
that will apply in respect of that member in a financial year is
15% of that member's surchargeable contributions for that year.
Where a member of a superannuation fund has not provided, in
connection with the operation of the Superannuation Contributions
Surcharge (Collection and Assessment) Bill 1997 his or her tax file
number to their superannuation fund/s, and the Commissioner of
Taxation has not otherwise found out their tax file number, the
rate of surcharge that will apply in a financial year is 15% of
their surchargeable contributions for that year.
The validity of the proposed Superannuation Contributions
Surcharge (Assessment and Collection) Act 1997 has been
questioned in submissions to the Senate Select Committee on
Superannuation examining the package of legislation which this Bill
forms part of. Mr Rose's argument was based on the difference
between the liability to pay a tax and the obligation to collect
the tax. According to Mr Rose's argument, under the legislation
originally put to Parliament, the superannuation provider would not
only be liable to collect the tax from those members liable to pay
the surcharge but would also be liable to pay any amount that has
not been collected, and so be liable to pay a tax that is levied on
another. Mr Rose then argues that this is in breach of various High
Court decisions and would result in the surcharge legislation being
unenforceable as the main collection mechanism is
unconstitutional.
The Prime Minister has responded to the opinion of Mr Rose in a
'Doorstop Interview' on 11 March 1997. The Prime Minister refuted
the opinion of Mr Rose.
The Government has introduced a number of amendments designed to
ensure that the argument raised by Mr Rose will not affect the
Constitutional basis of the Bill. However, it has been reported
that even if the amendments are passed, there may still be the same
potential Constitutional difficulties with the surcharge scheme,
although other provisions will be affected.(1)
- 1 Australian Financial Review, 26 March 1997, p. 3.
Chris Field
Ian Ireland
3 April 1997
Bills Digest Service
Information and Research Services
This Digest does not have any official legal status. Other
sources should be consulted to determine whether the Bill has been
enacted and, if so, whether the subsequent Act reflects further
amendments.
IRS staff are available to discuss the paper's contents
with Senators and Members and their staff but not with members of
the public.
ISSN 1323-9031
Commonwealth of Australia 1996
Except to the extent of the uses permitted under the
Copyright Act 1968, no part of this publication may be
reproduced or transmitted in any form or by any means, including
information storage and retrieval systems, without the prior
written consent of the Parliamentary Library, other than by Members
of the Australian Parliament in the course of their official
duties.
Published by the Department of the Parliamentary Library,
1997.
This page was prepared by the Parliamentary Library,
Commonwealth of Australia
Last updated: 10 April 1997
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