Second Reading SpeechMr Dutton (Minister for Revenue and Assistant Treasurer)
That this bill be now read a second time.
This bill is a related bill to the Tax Laws Amendment (Simplified Superannuation) Bill.
The purpose of the bill is to make consequential legislative amendments to implement the government's simplified superannuation reforms.
The reforms will sweep away the current raft of complex tax arrangements that apply to superannuation, improve incentives to save, increase retirement incomes and strengthen incentives for older Australians to stay in the workforce. At the centre of the reforms is making superannuation benefits tax free, if paid from a taxed superannuation fund, to someone aged 60 and over.
The superannuation taxation law has also been rewritten from the Income Tax Assessment Act 1936 into the Income Tax Assessment Act 1997 as part of the reforms. The rewrite will streamline the law and provide a clearer picture of the taxation of superannuation savings. It will cut the number of superannuation related pages in the assessment acts by over a third.
This bill repeals the old superannuation taxation law, including reasonable benefit limits, and updates cross-references to superannuation taxation law contained in other acts.
Updating cross-references to superannuation taxation law contained in other acts will clarify policy intent in a number of areas going forward. This includes how superannuation will be treated in the event of bankruptcy, for child support purposes and social security purposes.
Amendments in this bill will also improve arrangements with respect to lost and unclaimed superannuation.
The Australian government will now take full responsibility for the management of unclaimed superannuation, which means that, in the future, unclaimed superannuation money will not be paid to the states or territories. This is consistent with the arrangements for lost superannuation and will provide a single access point for individuals searching for lost or unclaimed superannuation and a simpler national claims process going forward. As a result, individuals will be able to seek advice directly from the ATO, instead of having to contact numerous government agencies.
This bill also makes some minor additions to the simplified superannuation law to clarify policy intent and, in some cases, to address industry and community concerns raised.
These amendments include clarification of transitional arrangements for employers and individuals with substituted accounting periods and relaxed arrangements for people contributing amounts related to personal injury or small business capital gains tax concessions up until 30 June 2007.
As a package, the simplified superannuation bills represent a substantial investment by the government in the standard of living of Australians in retirement and the country's future economic prosperity.
Full details of the measures in this bill are contained in the explanatory memorandum.
Debate (on motion by Mr Crean) adjourned.