House of Representatives

Income Tax (International Agreements) Amendments Bill (No.2) 1976

Income Tax (International Agreements) Amendments Act (No. 2) 1976

Second Reading Speech

by the Treasurer, the Hon. Phillip Lynch, M.P.

This short Bill is of a technical nature.

The Bill is needed because the proposed health insurance levy will be collected through the income tax system and is for many technical purposes to be treated as an income tax.

In substance, however, the levy is a payment for health insurance.

It will be paid only by people who do not have insurance with a registered private insurance fund and do not pay a premium direct to Medibank.

In these circumstances it would be inappropriate to treat the levy as an income tax against which people who have income from foreign sources may credit foreign tax. The amount to be paid for medical services should not be reduced in this way.

The Bill, which I commend to the House, ensures that the levy will not be so treated.