Explanatory Memorandum
(Circulated by authority of the Minister for Revenue and Financial Services, the Hon Kelly O'Dwyer MP)Glossary
The following abbreviations and acronyms are used throughout this explanatory memorandum.
| Abbreviation | Definition |
| Bourke Street Fund | 2017 Bourke Street Fund Trust Account, established by the Victorian Government under section 19 of the Financial Management Act 1994 (Victoria) |
| DGR | deductible gift recipient |
| ITAA 1997 | Income Tax Assessment Act 1997 |
General outline and financial impact
DGR specific listing for the Bourke Street Fund
Schedule 1 to the Bill amends the Income Tax Assessment Act 1997 (ITAA 1997) to include the 2017 Bourke Street Fund Trust Account (Bourke Street Fund) on the list of deductible gift recipients (DGR). This allows members of the public to make tax deductible donations to the Bourke Street Fund.
Date of effect : The amendments apply to gifts to the Bourke Street Fund made after 20 January 2017 and before 21 January 2022.
Proposal announced : This measure was announced by the Prime Minister on 22 January 2017.
Financial impact : The amendments are estimated to have the following financial impact ($m) over the forward estimates period:
| 2016-17 | 2017-18 | 2018-19 | 2019-20 | 2020-21 |
| - | -0.5 | .. | .. | .. |
- zero
.. not zero but rounded to zero
Human rights implications : This Schedule does not raise any human rights issues. See Statement of Compatibility with Human Rights - paragraphs 1.13 to 1.16.
Compliance cost impact : Nil.
Chapter 1 DGR specific listing for the Bourke Street Fund
Outline of chapter
1.1 Schedule 1 to the Bill amends the ITAA 1997 to include the Bourke Street Fund on the list of DGRs. This allows members of the public to make tax deductible donations to the Bourke Street Fund.
Context of amendments
Deductible gift recipient status
1.2 The income tax law allows income tax deductions for taxpayers who make gifts of $2 or more to a DGR. DGRs are entities which fall within one of the general categories set out in Division 30 of the ITAA 1997 or are specifically listed by name in that Division.
1.3 DGR status helps eligible organisations attract public financial support for their activities.
Bourke Street Fund
1.4 On 21 January 2017, following the senseless and vicious attack that took place in Bourke Street and elsewhere in the central business district of Melbourne, the Victorian Government announced the creation of a fund to provide financial support to victims and their immediate families.
1.5 On 22 January 2017, the Prime Minister announced that the Australian Government would work with the Victorian Government to ensure that the fund received deductible gift recipient status.
Summary of new law
1.6 Schedule 1 adds the Bourke Street Fund as a DGR and therefore enables members of the public to make tax deductible gifts to the fund.
Detailed explanation of new law
1.7 Taxpayers may claim a tax deduction for gifts made to the Bourke Street Fund that was established by the Victorian Government under section 19 of the Financial Management Act 1994 (Victoria), provided the gift complies with the existing requirements of the income tax law. [Schedule 1, item 1, item 4.2.43 of the table in subsection 30-45(2) of the ITAA 1997]
1.8 This amendment ensures that the Bourke Street Fund receives appropriate support through the Commonwealth tax system for its goal of assisting the immediate families of those who lost their lives in the incident, as well as those who were injured and their immediate families.
Consequential amendments
1.9 Schedule 1 also amends the index for Division 30 of the ITAA 1997 to reflect the specific listing of the Bourke Street Fund. [Schedule 1, item 2, item 1AAA of the table in section 30-315 of the ITAA 1997]
Application and transitional provisions
1.10 The listing of the Bourke Street Fund applies to gifts made on or after 21 January 2017, when the creation of the fund was announced. [Schedule 1, item 1, third column of item 4.2.43 of the table in subsection 30-45(2) of the ITAA 1997]
1.11 It currently would cease to apply to gifts made on or after 21 January 2022. However, consideration will be given to whether this period may need to be extended should the operations of the Bourke Street Fund remain ongoing at that time. [Schedule 1, item 1, third column of item 4.2.43 of the table in subsection 30-45(2) of the ITAA 1997]
1.12 The amendments commence from the first day of the first quarter to start after the Bill receives Royal Assent. [Clause 2 of the Bill]
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Treasury Laws Amendment (Bourke Street Fund) Bill 2017
1.13 The Treasury Laws Amendment (Bourke Street Fund) Bill 2017 (the Bill) 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
1.14 The Bill amends the ITAA 1997 to include the Bourke Street Fund on the list of deductible gift recipients. This allows members of the public to make tax deductible gifts to the Bourke Street Fund.
Human rights implications
1.15 The Bill does not engage any of the applicable rights or freedoms.
Conclusion
1.16 The Bill is compatible with human rights as it does not raise any human rights issues.