Senate

Tax Laws Amendment (2013 Measures No. 2) Bill 2013

Revised Explanatory Memorandum

(Circulated by the authority of the Deputy Prime Minister and Treasurer, the Hon Wayne Swan MP)
This memorandum takes account of amendments made by the House of Representatives to the Bill as introduced

Deductible gift recipients

Outline of chapter

8.1 Schedule 10 to this Bill amends the Income Tax Assessment Act 1997 (ITAA 1997) to update the list of specifically listed deductible gift recipients (DGRs).

Context of amendments

8.2 The income tax law allows income tax deductions for taxpayers who make gifts of $2 or more to DGRs. To be a DGR, an entity must fall within one of the general categories set out in Division 30 of the ITAA 1997 or be specifically listed by name in that Division.

8.3 DGR status helps eligible funds and entities attract public financial support for their activities.

Summary of new law

8.4 The amendments add United Way Australia, Australian Neighbourhood Houses & Centres Association (ANHCA) Inc., the Australia Foundation in support of Human Rights Watch Limited, Layne Beachley - Aim for the Stars Foundation Limited, Aurora Education Foundation Limited and Social Traders Ltd as specifically listed DGRs.

8.5 The amendments also extend the existing DGR specific listings of the Charlie Perkins Scholarship Trust and Roberta Sykes Indigenous Education Foundation.

Detailed explanation of new law

Aurora Education Foundation Limited (ABN 28 158 391 363)

8.6 Taxpayers may claim a tax deduction for gifts made to Aurora Education Foundation Limited after 30 June 2013. [Schedule 10, item 1, item 2 . 2 . 5 in the table in subsection 30-25(2) of the ITAA 1997 ]

8.7 Aurora Education Foundation Limited works to promote and advance Indigenous education.

Roberta Sykes Indigenous Education Foundation (ABN 99 950 620 671)

8.8 Taxpayers may continue to claim a tax deduction for gifts made to the Roberta Sykes Indigenous Education Foundation after 1 August 2013. The current DGR specific listing for the Roberta Sykes Indigenous Education Foundation covers the period after 1 August 2010 to before 2 August 2013. The amendment removes the time limitation, allowing gifts made to Roberta Sykes Indigenous Education Foundation to be claimed as a tax deduction on an ongoing basis. [Schedule 10, item 2, item 2 . 2 . 40 in the table in subsection 30-25(2) of the ITAA 1997 ]

8.9 The Roberta Sykes Indigenous Education Foundation works to advance the education and life opportunities for Aboriginal and Torres Strait Islanders, and provides additional assistance to female Indigenous scholars undertaking programs overseas.

United Way Australia (ABN 60 002 806 215)

8.10 Taxpayers may claim a tax deduction for gifts made to United Way Australia after 25 April 2013. [Schedule 10, item 3, item 4 . 2 . 5 in the table in subsection 30-45(2) of the ITAA 1997 ]

8.11 United Way Australia works to improve the lives of people living in disadvantaged communities, by working primarily in areas of need associated with education, income stability, health and homelessness.

Australian Neighbourhood Houses &

Centres Association (ANHCA) Inc. (

ABN 47 588 370 196)

8.12 Taxpayers may claim a tax deduction for gifts made to Australian Neighbourhood Houses & Centres Association (ANHCA) Inc. after 30 June 2013. [Schedule 10, item 4, item 4 . 2 . 8 in the table in subsection 30-45(2) of the ITAA 1997 ]

8.13 Australian Neighbourhood Houses & Centres Association (ANHCA) Inc. is the national body representing its member entities: Neighbourhood Houses, Community Houses, Learning Centres, Neighbourhood Centres and Community Centres. Providing DGR status to Australian Neighbourhood Houses & Centres Association (ANHCA) Inc. will permit them to coordinate the national fundraising efforts of their member entities.

The Australia Foundation in support of Human Rights Watch Limited (ABN 90 153 747 954)

8.14 Taxpayers may claim a tax deduction for gifts made to the Australia Foundation in support of Human Rights Watch Limited after 30 June 2013. [Schedule 10, item 5, item 9 . 2 . 11 in the table in subsection 30-80(2) of the ITAA 1997 ]

8.15 The Australia Foundation in support of Human Rights Watch Limited is the Australian branch of Human Rights Watch, and will contribute to furthering and promoting Australia's commitment to the promotion and protection of universal human rights.

Layne Beachley -

Aim for the Stars Foundation Limited (ABN 72 101 890 340)

8.16 Taxpayers may claim a tax deduction for gifts made to Layne Beachley - Aim for the Stars Foundation Limited after 30 June 2013. [Schedule 10, item 6, item 13 . 2 . 4 in the table in section 30-105 of the ITAA 1997 ]

8.17 Layne Beachley - Aim for the Stars Foundation Limited conducts programs that aim to help women and girls with the cost of participating in sporting, cultural or educational activities.

Social Traders Ltd (ABN 42 132 665 804)

8.18 Taxpayers may claim a tax deduction for gifts made to Social Traders Ltd after 30 June 2013. [Schedule 10, item 6, item 13 . 2 . 5 in the table in section 30-105 of the ITAA 1997 ]

8.19 Social Traders Ltd aims to facilitate the development of a sustainable social enterprise sector that delivers social and economic inclusion.

The Charlie Perkins Scholarship Trust (ABN 22 789 846 363 - the trustee for the Charlie Perkins Scholarship Trust)

8.20 Taxpayers may claim a tax deduction for gifts made to the Charlie Perkins Scholarship Trust after 1 August 2010. The current DGR specific listing for the Charlie Perkins Scholarship Trust covers the period after 1 August 2010 to before 2 August 2013. The amendment removes the time limitation, allowing gifts made to Charlie Perkins Scholarship Trust to be claimed as a tax deduction on an ongoing basis. [Schedule 10, item 13, item 2 . 2 . 39 in the table in subsection 30-25(2) of the ITAA 1997 ]

8.21 The purpose of the Charlie Perkins Scholarship Trust is to advance the education of Aboriginal and Torres Strait Islander people through the provision of scholarships to Indigenous persons for study at overseas institutions, such as Oxford and Cambridge University.

Application and transitional provisions

8.22 The listing of United Way Australia applies to gifts made after 25 April 2013; and the listings of Australian Neighbourhood Houses & Centres Association (ANHCA) Inc., the Australia Foundation in support of Human Rights Watch Limited, Layne Beachley - Aim for the Stars Foundation Limited, Aurora Education Foundation Limited and Social Traders Ltd apply to gifts made after 30 June 2013.

8.23 The listings for the Charlie Perkins Scholarship Trust and Roberta Sykes Indigenous Education Foundation apply to gifts made after 1 August 2010.

8.24 Item 2 removes the end date from the special condition of the existing listing of Roberta Sykes Indigenous Education Foundation. It commences on Royal Assent. [Schedule 10, item 2, item 2 . 2 . 40 in the table in subsection 30-25(2) of the ITAA 1997 ]

8.25 Item 12 repeals the sunsetting provisions in the Tax Laws Amendment (2011 Measures No. 2) Act 2011 , which would repeal the listings of the Charlie Perkins Scholarship Trust and the Roberta Sykes Indigenous Education Foundation from 1 July 2016. It commences on Royal Assent. [Schedule 10, item 12 ]

8.26 The commencement of items 13, 14 and 15 is contingent on whether Schedule 1 to the Tax Laws Amendment (Special Conditions for Not-for-profit Concessions) Bill 2012 commences. [Schedule 10, items 13 to 15 ]

8.27 Schedule 1 to the Tax Laws Amendment (Special Conditions for Not-for-profit Concessions) Bill 2012, amongst other things, amends the sunsetting provisions under the Tax Laws Amendment (2011 Measures No. 2) Act 2011 and moves the listing of the Charlie Perkins Scholarship Trust from the table of education deductible gift recipients in subsection 30-25(2) to the table of international affairs deductible gift recipients in subsection 30-80(2) of the ITAA 1997.

8.28 Items 13 and 14 remove the end date from the special condition of the existing listing for the Charlie Perkins Scholarship Trust. The two items reflect amendments made by Schedule 1 to the Tax Laws Amendment (Special Conditions for Not-for-profit Concessions) Bill 2012 to move the listing of the Charlie Perkins Scholarship Trust. The commencement of each item depends on the date of commencement of that Schedule, which ensures the listing will be adjusted whether or not that Schedule commences. [Schedule 10, items 13 and 14, subsections 30-25(2) and 30-80(2) of the ITAA 1997 ]

Consequential amendments

8.29 A change has been made to update the index in Division 30 to add the new listings. [Schedule 10, items 7 to 11 ]

STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Deductible gift recipients

8.30 This Schedule is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 .

Overview

8.31 This Schedule amends the list of deductible gift recipients (DGR) in Division 30 of the ITAA 1997. The income tax law allows income tax deductions for taxpayers who make gifts of $2 or more to DGRs.

8.32 The amendments add United Way Australia, Australian Neighbourhood Houses & Centres Association (ANHCA) Inc., the Australia Foundation in support of Human Rights Watch Limited, Layne Beachley - Aim for the Stars Foundation Limited, Aurora Education Foundation Limited and Social Traders Ltd as specifically listed DGRs on an ongoing basis.

8.33 The amendments extend the listings of the Charlie Perkins Scholarship Trust and Roberta Sykes Indigenous Education Foundation as specifically listed DGRs to apply on an ongoing basis.

Human rights implications

8.34 This Schedule does not engage any of the applicable rights or freedoms.

8.35 The amendments in this Schedule are beneficial to taxpayers.

Conclusion

8.36 This Schedule is compatible with human rights as it does not raise any human rights issues.

Assistant Treasurer, the Hon David Bradbury


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