Bills Digest no. 58 2013–14
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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.
Kai Swoboda and Tarek Dale, Economics Section
Amanda Biggs, Social Policy Section
7 April 2014
Contents
The Bills Digest at a glance
Purpose of the Bill
History of the Bill
Committee consideration
Schedule 1—Unlawful payments from regulated superannuation funds
Schedule 2—Administrative directions and imposition of penalties
Schedule 3—Net medical expenses tax offset (NMETO) phase out
Schedule 4—Deductible gift recipients
Date introduced: 26 February 2014
House: House of Representatives
Portfolio: Treasury
Commencement: Various dates as set out in the table in section 2 of the Bill.
Note: This Digest is an historical Digest, published after the Bill was passed by Parliament and became an Act.
Links: The links to the Bill, its Explanatory Memorandum and second reading speech can be found on the Bill’s home page, or through http://www.aph.gov.au/Parliamentary_Business/Bills_Legislation
When Bills have been passed and have received Royal Assent, they become Acts, which can be found at the ComLaw website at http://www.comlaw.gov.au/.
Schedule 1
- Introduces civil and criminal penalties for promoters of schemes that have resulted, or are likely to result, in the illegal early release of superannuation benefits.
- Responds to a recommendation of the Cooper Review of Superannuation (2009–2010) to discourage illegal early release of superannuation benefits.
- Contains provisions which are in equivalent terms to those in a Bill that lapsed when the 43rd Parliament was prorogued (the Superannuation Legislation Amendment (Reducing Illegal Early Release and Other Measures) Bill 2012).
Schedule 2
- Introduces powers for the Commissioner of Taxation to give administrative directions and impose penalties for contraventions relating to self-managed superannuation funds (SMSFs).
- Contains provisions which are in equivalent terms to those in a Bill that lapsed when the 43rd Parliament was prorogued (as above).
Schedule 3
- Provides for the phase-out of the net medical tax expenses offset (NMETO) from 1 July 2013 to 1 July 2019 and restricts eligibility to out-of-pocket medical expenses on disability aids, attendant care or aged care only—with certain exemptions for taxpayers who previously received a rebate.
- Responds to a recommendation of the Henry Tax Review (2008–2009)—although the recommendation was subject to alternative methods of assistance being made available (such as safety nets).
Schedule 4
- Adds two entities to the list of deductible gift recipients (DGRs), changes the name of an existing DGR and extends the period of listing of one entity, thereby generally allowing for donations of $2 or more to these entities to be tax deductible for the donor.
The purpose of the Tax and Superannuation Laws Amendment (2014 Measures No. 1) Bill 2014 (the Bill) is to:
- amend the Superannuation Industry (Supervision) Act 1993 (SIS Act)[1] to:
– introduce civil and criminal penalties for the promoters of schemes that have resulted, or are likely to result, in the illegal early release of superannuation benefits (Schedule 1)
– introduce powers for the Commissioner of Taxation to give administrative directions and impose penalties for contraventions relating to self-managed superannuation funds (SMSFs) (Schedule 2)
- amend the Income Tax Assessment Act 1997 (ITAA 1997)[2] and various other taxation laws to phase out the net medical tax expenses offset (NMETO) from 1 July 2013 and to restrict its eligibility until 1 July 2019 to out-of-pocket medical expenses on disability aids, attendant care or aged care (Schedule 3) and
- amend the ITAA 1997 to add to the list of entities and change the name of another entity that are classified as deductible gift recipients (DGRs), thereby generally allowing for donations of $2 or more to the entity to be tax deductible for the donor (Schedule 4).
It should be noted that Schedules 1 and 2 of the Bill are in (almost) equivalent terms to Schedules 1 and 3 of the Superannuation Legislation Amendment (Reducing Illegal Early Release and Other Measures) Bill 2012, which lapsed when the 43rd Parliament was prorogued (the lapsed superannuation Bill).[3]
Comments about the lapsed superannuation Bill will be referred to in this Bills Digest where relevant.
Importantly, the Income Tax Rates Amendment (Unlawful Payments from Regulated Superannuation Funds) Bill 2012,[4] was introduced at the same time as the lapsed superannuation Bill as part of a package of measures—but it also lapsed when the 43rd Parliament was prorogued (the lapsed tax Bill).[5] The lapsed tax Bill proposed to increase for most taxpayers the relevant income tax rate on funds received from these activities. The measure proposed by the lapsed tax Bill is not part of the measures dealt with by this Bill.
Senate Selection of Bills Committee
The Selection of Bills Committee resolved not to refer the Bill to a Parliamentary Committee for inquiry and report.[6]
Senate Standing Committee for the Scrutiny of Bills
The Senate Standing Committee for the Scrutiny of Bills (the Scrutiny of Bills Committee) had no comments on the Bill.[7]
Parliamentary Joint Committee on Human Rights
The Parliamentary Joint Committee on Human Rights (the Human Rights Committee) expressed concerns in relation to Schedules 1 and 3 of the Bill.[8] The Committee’s comments are discussed below.
The Human Rights Committee examined the provisions of the lapsed superannuation Bill. Its comments are discussed under the relevant Schedule headings in this Bills Digest.
Statement of Compatibility with Human Rights
As required under Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the Bill’s compatibility with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of that Act.[9] The Government considers that the Bill is compatible.[10]
Schedule 1 of the Bill amends the SIS Act to prohibit the promotion of illegal superannuation early release schemes. The provisions of Schedule 1 commence on Royal Assent.
The amendments in Schedule 1 of the Bill are in (almost) equivalent terms to those contained in Schedule 1 of the lapsed superannuation Bill.[11]
Background
The overriding objective of superannuation regulatory arrangements is to limit a person’s early access to their accumulated superannuation savings so as to maximise the benefits available to them on their retirement. Access is limited first, by way of a statutory preservation age before which a person cannot access their superannuation—that is, age 55 for those born prior to 1 July 1960 increasing incrementally to age 60 for those born after 30 June 1964.[12] Second, access to superannuation is limited to those persons who satisfy the statutory conditions that constitute ‘retirement’.[13]
Notwithstanding the overriding objective to limit a person’s access to superannuation funds prior to retirement, there are, nevertheless, a range of circumstances in which early access to superannuation is available. These are set out in regulations and include, but are not limited to:
- circumstances where a person is suffering from a terminal medical condition
- circumstances where a person is in severe financial hardship and
- where compassionate grounds exist.[14]
Early release of superannuation is tightly regulated, with applications for early release required to be made to Medicare Australia, except in the case of severe financial hardship, where applications can be made directly to the relevant superannuation fund.[15]
The existing early release arrangements have provided an opportunity for unscrupulous individuals to establish SMSFs for the purpose of accessing the superannuation savings of complicit or unknowing superannuation fund members.
The Australian Taxation Office (ATO) has issued a number of warnings about promoters of early release schemes since 2002. At that time the ATO noted that promoters had advertised that they could arrange for early access to an individual’s superannuation prior to retirement for personal uses and that such schemes could contravene provisions of the SIS Act.[16] Further advices were issued in later years by both the Australian Securities and Investments Commission (ASIC)[17] and the ATO.[18]
Amendments were made to tax rates applying on amounts received through illegal early release schemes in June 2002, when the tax rate on these amounts changed from being taxed at a concessional rate, to being taxed at the taxpayer’s marginal rate.[19]
Under current arrangements, enforcement action against promoters of illegal early release schemes is based on the provisions of the Corporations Act 2001[20] and the SIS Act which relate to the licencing of financial service providers and the operating requirements for superannuation funds. Recent examples of successful enforcement activities include:
- banning an individual from providing services for six years after he arranged the unlawful early release of approximately $1.7 million of superannuation benefits[21] and
- imprisonment of an individual for failing to ensure that his SMSF—which was being used to rollover the superannuation benefits of 192 superannuants which were then withdrawn and released—was maintained in accordance with the sole purpose test under the SIS Act.[22]
In addition to these cases, recent ATO annual reports point to the effect of regulatory action in preventing the operation of illegal early release schemes:
- in 2012–13, the ATO claimed to have prevented 191 funds from entering the system and removed 438 suspect funds where they suspected illegal access was planned[23]
- in 2011–12, the ATO claimed to have prevented 298 funds from entering the system and removed 427 existing funds where they suspected illegal access was planned. The ATO also audited 35 promoters and 492 participants of earlier‑year illegal schemes, with tax and penalties totalling $6.7 million raised and prosecution action progressing against a number of the promoters. The ATO noted that no new schemes or promoters were detected[24] and
- in 2010–11, the ATO claimed to have stopped 373 funds from operating and a further 243 funds from registering because of their connection with schemes to facilitate the illegal release of superannuation. The ATO also audited 966 individuals and 33 promoters involved in illegal early release schemes and raised over $14.4 million in liabilities.[25]
The amendments proposed by Schedule 1 of the Bill are based on the recommendations of the Super System Review (also known as the ‘Cooper Review’ after the Chair of the Review Committee, Jeremy Cooper).[26] Some of the measures recommended by the Cooper Review to improve the integrity of the SMSF framework included:
- providing the ATO with the power to issue administrative penalties against SMSF trustees on a sliding scale reflecting the seriousness of the breach. The penalties are not payable from the corpus of the fund, and may be applied jointly or severally against the trustees or trustee director[27]
- providing for criminal and civil sanctions to enable the ATO to penalise and discourage illegal early release scheme promoters28]
- amending existing tax laws so that:
– amounts illegally early released be taxed at the superannuation non‐complying tax rate and
– an additional penalty, based on a sliding scale of penalties that takes into account the individual circumstances, should apply [29]
- requiring that rollovers to an SMSF be captured as a designated service under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006.[30]
Some of the other suggested measures relating to the integrity of the SMSF system that were recommended by the Cooper Review, but not covered by this Bill, included proof of identity checks for all people joining a new SMSF, recording the details of the person who has provided advice in relation to the establishment of new SMSFs to assist regulators conduct risk assessments and verification systems for large superannuation funds transferring funds to SMSFs.[31]
The former Government’s response to the Cooper Review, released in December 2010, agreed with all of these recommendations[32] and proposed the implementation of many of the measures from 1 July 2012.[33]
Government position
The Coalition’s 2014 election superannuation policy did not specifically include measures proposed by Schedule 1 of the Bill.[34] However, during debate on the lapsed superannuation Bill, the Coalition spokesman on small business indicated the Coalition supported the proposed changes, noting:
The coalition will be supporting the measures contained within this bill. The changes are supported by industry and are expected, albeit a little late, following the handing down of the Hooper [sic] review over two-and-a-half years ago, but here they are and they will have the coalition's support.[35]
It was not surprising then that the Government announced that it would implement the measures included in Schedule 1 of the Bill on 14 December 2013.[36] This followed an announcement on 6 November 2013 that the proposed measures would be the subject of further consultation before a final decision was made on their implementation.[37]
The provisions of the lapsed tax Bill were considered for further consultation in the 6 November 2013 announcement.[38] However, those provisions were included as a ‘do not proceed’ measure in the 14 December 2013 announcement.[39]
Policy position of non-government parties/independents
Australian Labor Party (ALP) Senators and Members of the House of Representatives may be expected to support the amendments in Schedule 1 of the Bill due to its similarity to the lapsed superannuation Bill. However, it is unclear whether the absence of an equivalent to the lapsed tax Bill will be an issue.
Position of major interest groups
The peak body representing the SMSF sector, the Self-Managed Superannuation Funds Professionals’ Association of Australia (SPAA), is broadly supportive of the policy intent behind Schedule 1 of the Bill.[40] In relation to the lapsed superannuation Bill, the SPAA noted:
While we believe that occurrences of illegal early access of superannuation funds appear to be declining, where it does occur, it is important that the Commissioner of Taxation can respond appropriately. SPAA believes that making the promotion of an illegal early release scheme a civil penalty breach under the Superannuation Industry (Supervision) Act 1993 will be a significant deterrent for promoters of illegal early release schemes.[41]
Similarly, other superannuation industry bodies including the Association of Superannuation Funds of Australasia (ASFA), the Australian Institute of Superannuation Trustees (AIST) and the Institute of Public Accountants (IPA) have expressed their general support for the policy measures included in Schedule 1 of the Bill.[42]
Financial implications
The Explanatory Memorandum notes that the financial impact of the measure is ‘nil’, with the ‘[c]osts associated with implementing a range of measures relating to the self managed superannuation fund (SMSF) sector, including penalties for promoters of illegal early release schemes, were offset by a previous increase to the SMSF supervisory levy’.[43]
Key issues and provisions
Prohibition on promoting a scheme
Item 1 of Schedule 1 to the Bill inserts proposed section 68B into Part 7 of the SIS Act to prohibit a person from promoting a ‘scheme’ that has resulted in, or is likely to result in, a payment being made from a regulated superannuation fund otherwise than in accordance with the payment standards that are set out regulations in accordance with subsection 31(1) of the SIS Act.[44] These standards include the specification of the preservation age (the age at which superannuation account balances can be accessed) as well as other specific and limited conditions for the early release of superannuation.[45]
Civil penalty
Item 2 of Schedule 1 to the Bill amends section 193 of the SIS Act so that the prohibition outlined above is a civil penalty provision. Contravention of a civil penalty provision may result in a fine not exceeding 2,000 penalty units.[46] In addition, section 202 of the SIS Act provides that where a person contravenes a civil penalty provision, either dishonestly and intending to gain an advantage for that, or any other person, or intending to deceive or defraud someone, then the person is guilty of an offence punishable on conviction by imprisonment for not longer than five years.[47]
When the equivalent provisions of the lapsed superannuation Bill were examined by the Human Rights Committee, further information was requested about whether the imposition of a civil penalty for a violation of proposed section 68B would involve the ‘determination of a criminal charge’ within the meaning of Article 14 of the International Covenant on Civil and Political Rights (ICCPR) and, if so, whether the application of the rules of evidence and of the procedure applicable in civil proceedings is inconsistent with that article’.[48]
The Statement of Compatibility with Human Rights for this Bill appears to give further consideration to this issue, concluding that ‘the civil penalty provisions do not involve the ‘determination of a criminal charge’ within the meaning of Article 14 of the ICCPR. Consequently it concludes the provisions of Schedule 1 of this Bill ‘do not engage any human rights’.[49]
However, the Human Rights Committee remains concerned about this issue and resolved to write to the Treasurer:
… to seek clarification as to why a maximum penalty of $340,000 for an individual is considered to be appropriate in these circumstances, and if not, whether sufficient provision has been made to guarantee compliance with the relevant criminal process rights provided for under the ICCPR, in particular the right to be presumed innocent, the right not to incriminate oneself and the prohibition against double jeopardy.[50]
Commenting on the lapsed superannuation Bill, the IPA expressed some concern that the prospect of a fine of 2,000 penalty units may be more of a deterrent to a superannuation fund with a low balance than to those funds with balances in the hundreds of thousands of dollars.[51] The IPA suggested that an alternative was to have a penalty set at a multiple of two or more times the amount released.[52]
The SPAA noted that the wording of proposed section 68B—in particular the prohibition on promoting a scheme that is likely to result in a payment being made from a regulated superannuation fund otherwise than in accordance with the payment standards—may, in some cases, inadvertently capture financial advisors who have recommended that their clients commence a transition to retirement pension once they have attained their preservation age.[53] The SPAA recommended that to avoid such a situation, a new paragraph be inserted in the Explanatory Memorandum that noted a person would not contravene section 68B if, subject to an objective analysis, an illegal payment was paid which was not the purpose of the arrangement, or it was unintended.[54]
However, subsection 221(2) of the SIS Act already provides that if it appears to the court that a person has, or may have, contravened a civil penalty provision but that the person has acted honestly and having regard to all the circumstances of the case, the person ought fairly to be excused for the contravention, the court may relieve the person either wholly or partly from a liability that might otherwise be imposed on the person because of the contravention. That being the case, an amendment to the Explanatory Memorandum would appear to be unnecessary.
Absence of the provisions of the lapsed tax Bill
The amendment proposed by Schedule 1 of the Bill are a stand-alone measure rather than part of a broader package which would also see payments received by taxpayers through illegal early superannuation access schemes taxed at the highest marginal tax rate—45 per cent—rather than at a taxpayer’s marginal rate, as was proposed by the lapsed tax Bill.[55]
The effect of not introducing such a complementary measure is that there is no additional penalty (albeit only for those on lower marginal rates) for individuals who receive funds as a result of the illegal early release of superannuation.
The Cooper Review had recommended such a measure so that amounts illegally early released would be taxed at the superannuation non‐complying tax rate (45 per cent) and that an additional penalty, based on a sliding scale of penalties that takes into account the individual circumstances, should also apply.[56]
That recommendation was based on the premise that it was inequitable for individuals who received funds through illegal early release schemes to be subject to the same tax arrangements as if the funds had been released through the existing early release arrangements and that some deterrence was required. The Cooper Review noted that:
Depending on their overall assessable income, individuals who illegally release their superannuation early (through a scheme or otherwise) possibly face paying tax on the amounts released. Penalties might also be applicable if they do not declare these amounts as income. This, however, is the same for those who follow the law and get early release legally. The current position is therefore inequitable.
The Panel believes that those without an entitlement to early release should not benefit from their access. Presently, people who have their illegal withdrawals assessed will still have the benefit of what they are left with. For example, if someone releases $10,000 illegally and the tax on this is $1,500, they will keep the $8,500 balance. If their income is low enough, they will not pay tax at all.
For some people, forfeiting a portion of their superannuation to tax (and promoter fees where applicable) to access the remaining balance, years before they are legally entitled to, might be quite appealing.[57]
Whilst the terms of the lapsed tax Bill appeared to have general support of superannuation interest groups, the AIST, in commenting on the draft of the lapsed tax Bill, considered that an additional penalty, based on a sliding scale of penalties which takes into account an individual’s circumstances, should be imposed.[58] The AIST considered that this would be consistent with the recommendations of the Cooper Review.[59]
Similarly, the IPA considered that that those who had deliberately sought illegal early access should be subject to tax at a penalty rate of 45 per cent on the amounts received.[60] However, the IPA considered that, because many people targeted by promoters have low English language skills and little understanding of the complexity of superannuation laws and therefore did not fully understand the ramifications of their involvement, the application of the 45 per cent tax rate should only occur in cases where it is clear that the person whose funds are accessed appreciated that it was an illegal early access scheme.[61]
Concluding comments
The Cooper Review recommendations aimed at reducing the incidence of illegal early release of superannuation benefits supported a penalty approach that targeted both the promoters of such schemes as well as the individuals who benefited from the early release of these funds. The approach as proposed by the Government no longer involves imposing penalties on individuals who receive these funds.
Schedule 2 of the Bill amends the SIS Act to give the Commissioner of Taxation powers to give a range of administrative directions and to impose penalties in the event of contraventions of the SIS Act in relation to SMSFs. The provisions of Schedule 2 of the Bill are in equivalent terms to those which were contained in Schedule 3 of the lapsed superannuation Bill. They are to commence on 1 July 2014.
Under existing arrangements, some of the key enforcement options available to the Commissioner of Taxation in regulating SMSFs are:
- to make the SMSF non-compliant for superannuation tax concessions (known as the ‘nuclear option’)
- to accept a court-enforceable undertaking from trustees of contravening funds[62] and
- to apply to the court for civil penalties to be imposed for certain breaches of the SIS Act.[63]
Concerns over the ‘nuclear option’ of existing penalty provisions applying to the trustees of SMSFs and illegal early access to superannuation were addressed by the Cooper Review.[64] The rationale for a more flexible regulatory regime was noted by the Review:
The Panel agrees with the views expressed in a number of submissions that the framing and application of the current penalty regime reflects an ‘all or nothing approach’ that is not optimal … The absence of an option for the ATO to apply graduated penalties results in the vast majority of contravening trustees avoiding any sanction by simply rectifying their contravention if and when it is detected. Rectification is, of course, appropriate, but it is not appropriate that trustees can continue to contravene and for their actions to have no consequences. This works counter to the principles of compliance and deterrence‐based regulation and the Panel believes that credible and proportional penalties are required to support the ongoing integrity of the system.
The Panel considers that the existing penalty regime limits the ATO’s ability to achieve optimal regulation. It believes that additional tools (both punitive and educational), in conjunction with its existing powers, are required to give it more flexibility.[65]
The Coalition’s 2014 election superannuation policy did not specifically include measures proposed by Schedule 2 of the Bill.[66] However, as noted previously, during debate in the 43rd Parliament on similar provisions included in the lapsed superannuation Bill, the then opposition spokesman on small business indicated the Coalition supported the proposed changes.[67]
The Government announced that it would implement the measures included in Schedule 2 of the Bill on 14 December 2013.[68] This followed an announcement on 6 November 2013 that the proposed measures would be the subject of further consultation before a final decision was made on their implementation.[69]
Policy position of non-government parties/independents
The ALP Senators and Members of the House of Representatives may be expected to support the amendments in Schedule 2 of the Bill as it is in (almost) equivalent terms to Schedule 3 of the lapsed superannuation Bill from the 43rd Parliament.
Position of major interest groups
SPAA broadly supports the creation of a more ‘flexible’ penalty regime, noting that:
‘[u]nder the current law, the system is far too inflexible—the ATO only has draconian penalties to apply to SMSFs, even for minor contraventions, and these penalties simply don't fit the crime.
SPAA believes most trustees only breach the law inadvertently, and that this new penalty regime reflects this to a far greater degree.[70]
The other peak superannuation industry groups also broadly supported the proposed compliance regime as it was set out in Schedule 3 of the lapsed superannuation Bill.
Financial implications
The Explanatory Memorandum notes that the financial impact of the amendments in Schedule 2 of the Bill is ‘nil’, with the ‘[c]osts associated with implementing a range of measures relating to the self-managed superannuation fund (SMSF) sector, including administrative directions and penalties, were offset by a previous increase to the SMSF supervisory levy’.[71]
Statement of Compatibility with Human Rights
The Statement of Compatibility with Human Rights states that the amendments in Schedule 2 of the Bill engage the right to be presumed innocent in accordance with Article 14(2) of the International Covenant on Civil and Political Rights.[72] However, the Government has assessed the amendments in Schedule 2 of the Bill as compatible with those human rights.[73] The Human Rights Committee had no comments on Schedule 2 of the current Bill, or the equivalent amendments in Schedule 3 of the lapsed superannuation Bill.[74]
Key issues and provisions
Item 22 of Schedule 2 to the Bill inserts proposed Part 20 into the SIS Act to allow the Commissioner of Taxation to make rectification directions and education directions and to impose administrative penalties for certain contraventions. Proposed sections 159–165 of the SIS Act deal with the giving of directions.
The Commissioner of Taxation may, where he or she has a reasonable belief that a trustee of an SMSF, or a director of a body corporate that is a trustee of an SMSF, has contravened a provision of the SIS Act or regulations in relation to the fund:
- issue a rectification direction requiring the person to take specified action within a specified time to rectify the contravention and to provide evidence that the direction has been complied with: proposed section 159 and
- issue an education direction requiring the person to undertake a specified approved course of education within a specified time and to provide evidence of completion of the course: proposed section 160.
A person who does not comply with a rectification direction or an education direction within the specified period, commits an offence of strict liability. Importantly, the imposition of strict liability will not criminalise honest errors and a person cannot be held liable if he, or she, had an honest and reasonable belief that they were complying with relevant obligations.[75] The penalty for the offence is 10 penalty units.[76]
The Commissioner of Taxation may approve in writing one or more courses for the purposes of giving education directions. In that case, the course is to be provided free of charge for persons who undertake the course in compliance with an education direction: proposed section 161. Where a person undertakes a course of education in compliance with an education direction, the costs associated with undertaking the course must not be reimbursed by the assets of the fund in relation to which the direction was given: proposed section 162.
A person to whom a rectification direction or an education direction has been given may make a written request to the Commissioner of Taxation to vary the decision. The request must be made within the time specified for action in the direction. The Commissioner of Taxation must, within 28 days of the day that the request was made, decide to vary the decision (either in accordance with the request or in some other way) or refuse to vary the decision. If the Commissioner of Taxation does not make a decision within that time, he or she is taken to have refused the request: proposed section 164.
Where a person is dissatisfied with a decision of the Commissioner of Taxation to give a direction, to refuse to vary a direction in accordance with a request or to refuse to vary a direction at all, the person may object to the decision as in accordance with the provisions of Part IVC of the Taxation Administration Act 1953.[77]
Proposed sections 166–169 of the SIS Act deal with liability for administrative penalties. Proposed section 166 outlines the specific provisions of the SIS Act which, when contravened, will attract administrative penalties. The penalties range from a low of five penalty units[78] for breaching requirements related to appointing investment managers in writing[79] to 60 penalty units[80] for breaches relating to the general prohibition on borrowing and lending by superannuation funds.[81] Proposed section 168 provides that an administrative penalty must not be paid or reimbursed from the assets of the fund in relation to which the administrative penalty was imposed.
In its submission about the level of penalties in the lapsed superannuation Bill, the Institute of Chartered Accountants Australia argued that, while the Commissioner of Taxation has some discretion to reduce or remit a penalty, the ‘penalty units assigned to certain breaches may be excessive’.[82]
The SPAA noted in its submission on the draft lapsed Bill that there was some uncertainty over the level of penalties that apply to corporate trustees, as subsection 4B(3) of the Crimes Act 1914 can effectively increase the administrative penalty by a factor of five, compared to that imposed on a natural person.[83] The SPAA commented that:
… increased penalties for body corporates have an important place in the regulation of corporate entities, but we believe that this principle is not suitable for the regulation of SMSFs. SMSFs normally have a small number of directors and the function and purpose of the fund has no difference whether it has natural persons as trustees or a corporate trustee with directors who are the SMSFs members.[84]
Schedule 3 of the Bill provides for the phase out of the net medical tax expenses offset (NMETO) from 1 July 2013 to 1 July 2019 and restricts its eligibility to include out-of-pocket medical expenses on disability aids, attendant care or aged care only. The Schedule has two parts. Items 3–8 of Part 2 of Schedule 3 commence on 1 July 2019. All the remaining items in Schedule 3 commence on Royal Assent.
Evolution of NMETO
Tax concessions for out-of-pocket medical expenses have been available in some form for at least the last 50 years. Broadly, an out-of-pocket medical expense ‘is the cost of the medical expense incurred, minus available reimbursements’.[85] Between 1963 and 1975 medical expenses incurred by Australian taxpayers were fully deductible, but since then the level of concession or rebate has been set at a proportion of out-of-pocket medical expenditure above a specified expenditure threshold.[86]
From 1997–98, the rebate for the NMETO was set at 20 per cent for eligible out-of-pocket medical expenditure above a threshold of $1,250.[87] In 2002, the expenditure threshold was lifted to $1,500, and in 2010 it was lifted to $2,000, and annual indexation introduced. In 2012–13 a means test was introduced, so that those on taxable incomes above the income threshold ($84,000 for singles and $168,000 for families, and indexed annually) were eligible to claim a rebate of 10 per cent of expenses above $5,000. Those on taxable incomes below the means test cut-off were eligible for a rebate of 20 per cent of expenses that exceeded $2,120 (indexed annually).
Henry tax review
The Henry Tax Review recommended that the NMETO should be removed for several reasons. These were that it does not provide assistance when the expense is incurred as it is claimed at the end of the income year; it is claimed by an individual but assessed on a family basis; it is inequitable for individuals who must incur the same costs as a family in order to make a claim; and low-income families with high out-of-pocket medical expenses cannot claim the offset because of insufficient tax liability. Notably, the Henry Tax Review also recommended that an alternative method for delivering safety net arrangements for individuals with very high medical expenses should be developed and, to this end, supported the recommendation by the National Health and Hospitals Reform Commission (NHHRC) that the scope and structure of safety net arrangements be reviewed.[88] It is not clear at this time whether this approach will be adopted by the Government.
Implementing a budget measure
Schedule 3 of the Bill implements a 2013–14 budget measure of the former ALP Government with which the new Coalition Government announced it would proceed.[89] The Government argues the NMETO is not well targeted, as those on low incomes with no tax liability receive no benefit even if their medical expenses are high.[90] The Government also noted that it already provides support to people with high medical costs through the Medicare safety net.[91]
Schedule 3 of the Bill proposes amendments to the tax law that would allow NMETO to continue to be claimed to the 2018–19 income year, but only for medical expenses relating to disability aids, attendant care or aged care.[92] However, taxpayers who receive a rebate for the 2012–13 income year will remain eligible to claim medical expenses (as currently defined) for the 2013–14 income year. If they also receive a rebate amount in 2013–14 they will be eligible to claim a rebate for medical expenses for the 2014–15 income year. From 1 July 2019, the NMETO will be repealed. The Bill also makes a number of consequential amendments to facilitate the phase out of NMETO.
One rationale for the transition arrangements is that it would allow time for the new aged care and disability care funding arrangements currently being implemented, to become fully operational, allowing these to help offset any gap left by the abolition of the NMETO.[93]
Australian Tax Office statistics show that around 802,000 taxpayers received the NMETO in 2010–11, with claims totalling around $567 million.[94]
The provisions to phase out the NMETO were announced in the 2013–14 Budget as a revenue measure by the former ALP Government.[95] At the time, former Treasurer Wayne Swan argued that abolishing the offset is about ‘improving the sustainability of the health budget’.[96]
The positions of other parties and independents are not known at this time.
When the former Government announced it would remove the NMETO, consumer and medical groups were largely critical of the measure. An IVF lobby group was reportedly concerned that without the NMETO, fertility treatment would become unattainable for many due to its often high cost. The Consumers Health Forum (CHF) also warned that the abolition of NMETO, combined with other savings measures, could entrench already high out-of-pocket medical costs.[97]
The Australian Institute of Health and Welfare (AIHW) estimates that Australians pay an average of $1,082 per person per year out-of-pocket on medical services, higher than many other developed countries. There is also evidence that patients are increasingly forgoing or delaying medical treatment due to cost considerations.[98]
The Explanatory Memorandum outlines the revenue implications of the phasing out of the NMETO, for each of the forward years. Total savings to Government are estimated to be $968 million (slightly higher than the $963.5 million budget forecast), with the bulk of the savings accruing in the later years.[99]
According to the Statement of Compatibility with Human Rights, the amendments in Schedule 3 of the Bill engage the right to health under Article 12(1) of the International Covenant on Economic, Social and Cultural Rights (ICESCR)[100] and the rights of people with a disability under Articles 9 and 19 of the Convention on the Rights of Persons with Disabilities.[101] However, the Government has assessed that the amendments in Schedule 3 are compatible with those rights.[102]
The Human Rights Committee has undertaken to write to the Treasurer to seek:
- an explanation as to ‘whether any limitations on the right to health that may result from the phasing out of the NMETO are reasonable and proportionate to the achievement of the government’s fiscal priorities’ and[103]
- clarification on ‘whether the repeal of the NMETO is consistent with the rights of persons with disabilities, including whether the National Disability Insurance Scheme and other relevant supports will adequately compensate for any gap left by its abolition’.[104]
Division 17 of Part III of the Income Tax Assessment Act 1936 (ITAA 1936)[105] deals with concessional rebates or tax offsets. Specifically, section 159P of the ITAA 1936 deals with the rebate for medical expenses.
Item 1 of Schedule 3 inserts proposed subsections 159P(1A)—(1D) into the ITAA 1936 setting out the terms of the phase out of rebate for medical expenses. Proposed subsection 159P(1A) specifies that a taxpayer is not entitled to a rebate for medical expenses for the 2019–20 income year, or later years.
Proposed subsection 159P(1B) specifies that for the income years from 2013–14 to 2018–19, only medical expenses that relate to disability aids, attendant care or aged care services from an approved provider will be treated as an eligible medical expense. These amendments are referred to as Category A transitional arrangements in the Explanatory Memorandum.
However, there are exceptions to the rule in proposed subsection 159P(1B) of the ITAA 1936 so that it does not apply in the following circumstances:
- to the 2013–14 income year, if a taxpayer has received a rebate for medical expenses in the 2012–13 income year: proposed paragraph 159P(1C)(a)
- to the 2014–15 income year if a taxpayer has received rebates in both the 2012–13 and 2013–14 income years: proposed paragraph 159P(1C)(b)
- in respect of a trust estate:
– for the 2013–14 income year, if the trustee’s assessment included a rebate that was greater than nil for the 2012–13 income year: proposed paragraph 159P(1D)(a) or
– for the 2014–15 income year, if the trustee’s assessment in both the 2012–13 and 2013–14 income years included a rebate that was greater than nil: proposed paragraph 159P(1D)(b).
These amendments are referred to as Category B transitional arrangements in the Explanatory Memorandum.
Item 2 in Part 2 of Schedule 3 of the Bill amends the Fringe Benefits Tax Assessment Act 1986 (FBTA Act)[106] to insert into section 58L of that Act, definitions of medical expenses and medical treatment which are consistent with the proposed amendments to the ITAA 1936.
Items 3 to 8 of Part 2 of Schedule 3 to the Bill make consequential amendments to the ITAA 1936 and the ITAA 1997, which will facilitate the repeal of the NMETO provisions.
Schedule 3 of the Bill implements a budget measure of the former ALP Government that the Coalition Government has now adopted. The amendments propose the phase out by July 2019 of the NMETO, a rebate for high out-of-pocket medical expenses, and establish transitional arrangements. These would restrict the rebate to claims for disability aids, attendant care or aged care until 2018–19, after which time the NMETO would cease. The amendments propose exemptions that would allow a taxpayer who received a rebate in 2012–13 to be eligible to claim the rebate for medical expenses in 2013–14, and again in 2014–15 if they received a rebate the previous year.
The means-tested NMETO assists taxpayers with high out-of-pocket medical costs above a certain annual threshold of expenditure, but does not assist those with high costs but no tax liability. Other shortcomings identified by the Henry Tax Review led it to recommend that the NMETO be repealed, provided alternative methods of assistance were made available (such as safety nets).
Schedule 4 of the Bill adds two entities to the list of deductible gift recipients (DGRs), and extends the listing of one more. The Schedule contains two parts. The amendments in Part 1 of Schedule 4 (items 1–7) commence on Royal Assent. The amendments in Part 2 of Schedule 4 (items 8-9) commence on 17 December 2018.
Background
A deductible gift recipient (DGR) is an organisation that is entitled to receive income tax deductible gifts and deductible contributions. There are two methods of gaining DGR status:
- by applying to the Commissioner for Taxation for endorsement as a DGR or
- by having the organisation listed by name in Division 30 of the ITAA 1997 or in the Income Tax Regulations 1997.[107]
Taxpayers who make gifts of $2 or more to an organisation which is a DGR are able to deduct those amounts from their taxable income. Treasury estimates the annual cost to the budget of tax deductibility for gifts to DGRs at around $1.15 billion in 2013-14.[108]
As at 27 February 2014, there were 14,475 entities with active DGR status, of which 174 were specifically named in the ITAA 1997; 10,842 funds had DGR status.[109] In 2010–11, 38 per cent of individuals claimed a gift or contribution to a DGR as a deduction in their income tax return. In that year, claims for deductions were made in respect of a total of 4.8 million gifts valued at over $2.2 billion.[110]
Benefits of DGR status
While charities that have DGR status may be advantaged in attracting donations compared to those without DGR status, the evidence is mixed as to whether tax incentives for donations actually increase giving more generally. In its 2010 report on the contribution of the not-for-profit sector, the Productivity Commission noted:
[A report] Giving Australia (FACS 2005) suggests that the main reasons for giving by Australians are very similar to those identified in the international literature–altruism, values and awareness of need. That said, by lowering the price of giving, tax incentives can potentially increase the amount donated and the number of individuals donating. Indeed, for wealthy individuals in particular, it appears that tax incentives are an important factor in influencing the amount given.
... With no evidence of a crowding out effect in Australia and anecdotal evidence on tax inducement, the presumption must be that tax deductibility encourages philanthropic giving, especially by high income taxpayers. However, this conclusion is tentative and more analysis of giving behaviour in Australia is needed.[111]
The Government announced the formation of the Not-For-Profit Tax Concession Working Group in February 2012 to ‘consider ideas for better delivering the support … provided through tax concessions to the
not-for‑profit (NFP) sector’.[112] The terms of reference stated that the ‘Working Group will identify whether there are fairer, simpler and more effective ways of delivering the current envelope of support provided through tax concessions to the NFP sector’.[113]
The Working Group released a consultation paper in November 2012,[114] which included a history of DGR concessions as well as discussion of the DGR framework.[115] The paper also discussed options for reform, including extending DGR status to all charities, changes in the threshold, and a number of other options.[116]
The Working Group’s final report was made public by the Treasury in response to a request for access under the Freedom of Information Act 1982[117] on 21 February 2014.[118] The report is dated May 2013, but had not been previously released. The Working Group recommended that:
DGR status should be extended to all charities, but restricted to activities that are not for the advancement of religion, charitable child care and primary and secondary education, except where this is sufficiently related to another charitable purpose. Except in the most exceptional circumstances, DGR status should be limited to charities and charitable-like government entities.
… The current minimum of $2 for deductible gifts is an anachronism and could be removed with few consequences.[119]
The Working Group also rejected other options to modify the DGR system such as a replacing deductibility with a tax offset for donations. At the time of writing the Government had not made any statements on the release of the report.
Proposed changes to the list of deductible gift recipients
Several of the proposed changes to the listing of DGRs were endorsed by not acted upon by the former Government prior to the September 2013 Federal election:
- the extension of DGR status for the Bali Peace Park Association was included in the August 2013 Economic Statement as one of a number of organisations whose DGR status would be extended[120]
- the National Arboretum Canberra Fund was included in the August 2014 Pre-Election Economic and Fiscal Outlook as one of two organisations to receive DGR status.[121] The other was the Tasmanian Centre for Global Learning.[122]
The decisions taken by the Coalition Government as reflected in Schedule 4 of the Bill are:
- the announcement on 6 November 2013 that the Tasmanian Centre for Global Learning would not be granted DGR status[123] and
- the announcement on 17 December 2013 that the Prince’s Charities Australia Limited would be granted DGR status.[124]
Information about the activities of each of the entities proposed to be a DGR is set out in the Explanatory Memorandum.[125] This material is summarised in table 1, with links to each of the entities’ website where available.
Table 1 Deductible Gift Recipients (DGRs) in Schedule 4 of the Bill
| DGR type |
DGR name |
Conditions |
Summary of activities as outlined in the Explanatory Memorandum |
Link to website |
| Cultural organisations |
National Arboretum Canberra Fund |
The gift must be made on or after 1 July 2013. |
The National Arboretum Canberra Fund is a charitable trust maintained exclusively to support the National Arboretum Canberra. |
National Arboretum Canberra website |
| International Affairs |
Bali Peace Park Association |
Donations must be made before 16 December 2014 [the Bill extends the current listing for the Association from 17 December 2011 to 16 December 2014]. The ITAA 1997 specifies that the gift must be ‘used for the purpose of establishing the Bali Peace Park’. |
The Bali Peace Park Association Inc. aims to raise funds to acquire the Sari Club site, Bali, Indonesia, and create a ‘peace park’ on the land where the terrorist bomb was detonated on 12 October 2002 and to create an annual national awareness day on 12 October to allow for reflection and acknowledgement of the terrorist attack while promoting tolerance and understanding across cultures and religions. |
Bali Peace Park Association website |
| Education |
Sir William Tyree Foundation |
Taxpayers may claim a tax deduction for gifts made to the Sir William Tyree Foundation from 1 March 1999. The current DGR specific listing for the foundation is being updated to reflect a change of name of the Foundation from the Sir William Tyree Foundation of the Australian Industry Group to the Sir William Tyree Foundation. |
The Sir William Tyree Foundation funds certain academic positions within Australian universities or other appropriate educational institutions. The academic positions funded are directed at advancing knowledge in Australia in areas of innovation such as in general industry, engineering, electronics, construction, information technology, business and management practice, public or industry policy development and employer and employee relations. |
N/A. |
| Other recipients |
The Prince’s Charities Australia Limited |
Taxpayers may claim a tax deduction for gifts made to The Prince’s Charities Australia Limited on or after 1 January 2014. |
The Prince’s Charities Australia Limited is a charitable institution maintained to coordinate the Prince of Wales’ Australian and international charitable endeavours in Australia, and undertake a broad range of activities, modelled on those of the Prince’s Trust in the United Kingdom.
These activities include supporting disadvantaged young people and veterans, the preservation of the built environment (particularly Australia’s heritage buildings), promoting environmental sustainability, education and corporate social responsibility. |
Prince’s Charities Australia Limited website. |
Source: Explanatory Memorandum, Tax and Superannuation Laws Amendment (2014 Measures No. 1) Bill 2014, pp. 57–59, accessed 4 March 2014.
Policy position of non-government parties/independents
The ALP is likely to support the listing of the National Arboretum Canberra Fund and the extension of DGR status for the Bali Peace Park Association as this would reflect decisions that it made when in Government.
Debate in the Parliament about the DGR status of entities has included whether entities that may be ‘political’ in nature should have DGR status.[126] DGRs specified through legislation have previously been debated during a Bill’s passage,[127] have been amended by Government during the consideration in detail stage[128] and had motions moved to amend them in the Senate.[129]
Financial implications
The Explanatory Memorandum provides a table listing the expected revenue implications of granting DGR status to the organisations nominated in Schedule 4 of the Bill. In total, the additions and extensions are expected to cost $1.76 million over the forward estimates.[130]
Table 2 Financial impact of listing each organisation as a deductible gift recipient ($ million)
| Organisation |
2013–14 |
2014–15 |
2015–16 |
2016–17 |
| National Arboretum Canberra Fund |
Nil |
-0.02 |
-0.02 |
-0.02 |
| Bali Peace Park Association Inc. |
-0.1 |
-0.2 |
-0.1 |
Nil |
| The Prince’s Charities Australia Limited |
Nil |
-0.3 |
-0.5 |
-0.5 |
Source: Explanatory Memorandum, Tax and Superannuation Laws Amendment (2014 Measures No. 1) Bill 2014, p. 6, accessed 4 March 2014.
Key issues and provisions
Division 30 of the ITAA 1997 sets out the rules for working out deductions for certain gifts or contributions. In particular, subdivision 30-B contains tables of recipients of deductible gifts, divided into a number of categories.
Part 1 of Schedule 4 of the Bill amends the ITAA 1997 as follows:
- item 1 modifies the entry in the table in subsection 30-25(2) of the ITAA 1997, which relates to education, to change the entry from the ‘Sir William Tyree Foundation of the Australian Industry Group’ to the ‘Sir William Tyree Foundation’[131]
- item 2 extends DGR status for the Bali Peace Park Association from 17 December 2011 to 16 December 2014[132]
- item 3 inserts the National Arboretum Canberra Fund into the table in subsection 30-100(2) of the ITAA 1997, which relates to cultural organisations[133]
- item 4 inserts the Prince’s Charities Australia Limited into the table in section 30-105 of the ITAA 1997, which relates to other specific recipients[134] and
- items 5-7 update the index to Division 30 of the ITAA 1997 to reflect the addition of the two new DGRs and the modification of the name of the Sir William Tyree Foundation of the Australian Industry Group to the Sir William Tyree Foundation.[135]
Items 8 and 9 in Part 2 of Schedule 4 provide for the sunsetting of the DGR listing for the Bali Peace Park Association by repealing the listing from 17 December 2018.
Members, Senators and Parliamentary staff can obtain further information from the Parliamentary Library on (02) 6277 2500.
[6]. Senate Standing Committee for the Selection of Bills, Report No. 2 of 2014, The Senate, 6 March 2014, accessed 3 April 2014.
[9]. The Statement of Compatibility with Human Rights can be found at pages 14–19, 41–43, 55–56 and 60 of the Explanatory Memorandum to the Bill.
[13]. Under subregulation 6.01(7) of the Superannuation Industry (Supervision) Regulations 1994, ‘retirement’ cannot happen before the age of 55 but, after the age of 60, retirement may be taken to have occurred upon cessation of gainful employment even if the person subsequently re‑enters gainful employment: Superannuation Industry (Supervision) Regulations 1994, accessed 27 February 2014.
[19]. Income Tax Amendment Regulations 2002 (No. 5), accessed 27 February 2014. Concessional taxation on eligible termination payments were based on the taxpayer’s age and included lifetime thresholds. These were generally lower than the tax rates that applied at the time, including the top personal marginal tax rate of 47 per cent.
[26]. The Cooper Review was chaired by former deputy chairman of ASIC Jeremy Cooper. It was conducted over the period 2009–2010 and covered a broad range of issues including the performance and governance of the superannuation industry (Review into the governance, efficiency, structure and operation of Australia’s superannuation system (Cooper Review), ‘The review panel’, Cooper Review website, accessed 27 February 2014). The Cooper Review recommendations formed the basis for a number of legislative changes under the former Government’s ‘Stronger Super’ package of measures: Treasury, ‘Welcome to the Stronger Super website’, Stronger Super website, accessed 27 February 2014.
[28]. Ibid., recommendation 8.24, p. 256.
[29]. Ibid., recommendation 8.25, p. 257.
[31]. Ibid., recommendations 8.20–8.24, pp. 254–256.
[42]. Australian Institute of Superannuation Trustees, Submission to Treasury, Exposure Draft, Tax Laws Amendment (Stronger Super Self Managed Superannuation Funds) Bill 2012: administrative penalties, 14 September 2012, accessed 3 March 2014; Association of Superannuation Funds of Australia, Submission to Treasury, Exposure Draft, Tax Laws Amendment (Stronger Super Self Managed Superannuation Funds) Bill 2012: administrative penalties; Tax Laws Amendment (2012 Measures No. 6) Bill 2012: unlawful payments from regulated superannuation funds; Income Tax Rates Amendment (Unlawful Payments from Regulated Superannuation Funds) Bill 2012, 17 September 2012, accessed 3 March 2014; Institute of Public Accountants, Submission to Treasury, Exposure Draft, Tax Laws Amendment (Stronger Super Self Managed Superannuation Funds) Bill 2012: administrative penalties; Tax Laws Amendment (2012 Measures No. 6) Bill 2012: Unlawful payments from regulated superannuation funds; Income Tax Rates Amendment (Unlawful Payments from Regulated Superannuation Funds) Bill 2012, 19 September 2012, accessed 3 March 2014.
[43]. Explanatory Memorandum, Tax and Superannuation Laws Amendment (2014 Measures No. 1) Bill 2014, op. cit., p. 3.
[44]. The term ‘promote’ is defined in proposed subsection 68B(3) of the Superannuation Industry (Supervision) Act 1993. To ‘promote’ a scheme includes to enter into the scheme, to induce another person to enter into the scheme, to carry out the scheme, to commence to carry out the scheme and/or to facilitate entry into, or the carrying out of, the scheme.
[45]. Conditions of release are specified in Schedule 1 of the Superannuation Industry (Supervision) Regulations 1994 and cover circumstances such as death, attaining a specified preservation age and early access for a number of specified circumstances such as on compassionate grounds, terminal medical condition and severe financial hardship.
[47]. Section 203 of the Superannuation Industry (Supervision) Act 1993 provides that criminal proceedings for an offence constituted by a contravention of a civil penalty provision cannot be begun if a person has already applied for a civil penalty order in relation to the same contravention, even if the application has been finally determined or otherwise disposed of.
[49]. Explanatory Memorandum, op. cit., pp. 14–15.
[51]. Institute of Public Accountants, op. cit.
[53]. Self Managed Superannuation Funds Professionals’ Association of Australia, op. cit. pp. 5–6, accessed 27 February 2014.
[67]. B Billson, op. cit.
[72]. International Covenant on Civil and Political Rights done in New York on 16 December 1966, ATS [1980] No. 23 [Reprint], (entered into force for Australia (except Article 41) on 13 November 1980; Article 41 entered into force in Australia on 28 January 1993), accessed 5 March 2014.
[73]. Explanatory Memorandum, op. cit., p. 43.
[76]. Section 4AA of the Crimes Act 1914 provides that a penalty unit is equivalent $170. This means that the penalty amounts to $1,700.
[78]. This is equivalent to a penalty of $850.
[80]. This is equivalent to a penalty of $10,200.
[82]. Institute of Chartered Accountants Australia, op. cit., p. 2.
[87]. Eligible medical expenses are defined in section 159P of the Income Tax Assessment Act 1936. They include expenses related to an illness or operation provided by a qualified doctor, nurse, pharmacist or hospital, medical aids and appliances and artificial limbs, but exclude expenses for cosmetic purposes. Other ineligible expenses include non-prescription vitamins, over the counter pain relievers, accommodation or travel expenses associated with medical treatment, medical examinations for the purposes of life insurance, inoculations for overseas travel, ambulance charges or funeral expenses. See: Australian Taxation Office (ATO), Individual tax return instructions 2013: T6 - Total net medical expenses 2013, ATO webpage, accessed 3 March 2014.
[89]. J Hockey (Treasurer), A Sinodinos (Assistant Treasurer), op. cit.
[91]. J Hockey, A Sinodinos, op. cit.
[92]. See the Explanatory Memorandum for examples of disability aids, attendant care and aged care.
[93]. A Biggs, ‘Net medical expenses tax offset’, Budget review 2013–14, Research paper, 3, 2012–13, Parliamentary Library, Canberra, 2013, p. 131, accessed 3 March 2014.
[99]. Explanatory Memorandum, op. cit., p. 4.
[102]. Explanatory Memorandum, op. cit., pp. 55–56.
[122]. The Tasmanian Centre for Global Learning ‘empowers schools and the Tasmanian community to take action for social justice, peace and a sustainable world future’: The Tasmanian Centre for Global Learning (TCGL), ‘A fairer world’, TCGL website, accessed 28 February 2014.
[125]. Explanatory Memorandum, op. cit., pp. 57–59.
[126]. N Sherry, ‘Consideration of House of Representatives message: Taxation Laws Amendment Bill (No. 7) 2003’, Senate, Debates, 21 June 2004, p. 24434, accessed 1 May 2013; U Stephens, ‘Second reading speech: Tax Laws Amendment (2009 Measures No. 6) Bill 2009’, Senate, Debates, 11 March 2010, p. 1633, accessed 5 March 2014.
[130]. Explanatory Memorandum, op. cit., p. 6.
[131]. Proposed table item 2.2.18.
[132]. Proposed table item 9.2.23, column headed “Special conditions”. Gifts must be made before 16 December 2014.
[133]. Proposed table item 12.2.4. Gifts must be made after 30 June 2013.
[134]. Proposed table item 13.2.20. Gifts must be made after 31 December 2013.
[135]. ITAA 1997, subsection 30-315(2), proposed table items 73AAA, 89A and table item 111A.
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