ALP minority report
ALP minority report in respect of issues concerning
the Radiocommunications Legislation Amendment Bill 1999 raised by the Scrutiny
of Bills Committee Report
The Treasurer
announced in a press release of 11th March, 1998, that legislation
would be introduced to ensure that those holding spectrum licences, such as
mobile phone companies, paid tax in Australia.
This
legislative measure was included in the Radiocommunications Legislation
Amendment Bill 1999 which was introduced into the House of Representatives on
18th February, 1999 in breach of the Senate’s resolution, of 8th
November, 1998, namely that a tax measure announced by press release must be
introduced into the Parliament no later than six months after the date of the
press release.
The
Minister for Communications, Information Technology and the Arts, made a
statement to the Scrutiny of Bills Committee, on 23rd March, 1999,
to the effect that he had been advised by the Treasurer that the date of effect
for the legislation announced by press release, despite the Senate’s
resolution, should be maintained at 11th March, 1998 to preclude
problems of “tax avoidance”.
In the
course of this inquiry, Senator Bishop (A.L.P., W.A.) asked officers of the
Department of Communications, Information Technology and the Arts several
questions. In essence, these questions required:
(a)
an explanation
of why the introduction of the Radiocommunications Legislation Amendment Bill
1999, had been delayed so that it breached the Senate’s resolution on
legislation by press release, and,
(b)
a request for an
estimation of the loss of tax revenue that would result from moving the date of
effect of the legislation announced by the Treasurer’s press release from the
date of the press release to the date of the introduction of the legislation,
in accordance with the Senate’s resolution.
Despite
the fact that officers of the Department of Communications, Information
Technology and the Arts apparently sought the advice of Treasury, they were
unable, or unwilling, to answer these questions.
In
response to the request to estimate the amount of tax revenue lost to Australia
by subjecting the Radiocommunications Legislation Amendment Bill 1999 to the
resolution of the Senate, the Department of Communications, Information
Technology and the Arts was able only to repeat what it had been told by the
Australian Taxation Office, namely that it had no idea of the amount of tax
revenue, if any, involved.
Despite
this extraordinary lack of knowledge on the part of two relevant portfolio
Departments, the Department of Communications, Information Technology and the
Arts, in its second attempt to answer questions posed by Senator Bishop, stated
that it had been “advised” by the Australian Taxation Office that, despite not
knowing the amount of revenue involved, it was “important to maintain the date
of effect” of the legislation at the date of the Treasurer’s press release and
therefore the Senate should not apply its resolution regarding legislation by
press release.
The
Senate, however, should not set aside one of its resolutions simply because two
portfolio Departments effectively tell the Senate, without any evidence, that
“it is important” to do so.
In its
second attempt to respond to questions from Senator Bishop, the Department of
Communications, Information Technology and the Arts stated that the
Radiocommunications Legislation Amendment Bill 1999 was not introduced in the
Spring Sittings of 1998 because of the “need to obtain the Treasurer’s approval
to two unrelated radiocommunications measures, including consequential
amendments”.
The Bill
was therefore delayed because the Treasurer would not approve “consequential
amendments”, something which should have taken relatively little time.
Clearly
the Department of Communications, Information Technology and the Arts failed to
pursue the matter.
The
Department of Communications, Information Technology and the Arts stated that
it was advised by the Australian Taxation Office that the date of effect of the
legislation should be maintained at 11th March, 1998 because “[I]t
is necessary to guard against the possibility of non-resident taxpayers taking
advantage of their non-resident status to avoid Australian tax.”
It would
seem to be as the result of the inattention to detail and disregard for the
resolution of the Senate on the part of both Treasury and the Department of
Communications, Information Technology and the Arts that the
Radiocommunications Legislation Amendment Bill 1999 was not introduced until
over five months after the deadline set by the Senate’s resolution regarding
legislation by press release had passed.
Consequently
non-residents may be able to take advantage of a loophole in the law to avoid
paying tax in Australia.
The
Department of Communications, Information Technology and the Arts advised that
it consulted other portfolios regarding the Radiocommunications Legislation
Amendment Bill 1999 in a “timely manner”. It is difficult to understand how the
“timely” handling of a bill resulted in it being over five months late. The
Department of Communications, Information Technology and the Arts would seem to
have been very neglectful regarding the Radiocommunications Legislation
Amendment Bill 1999.
It is obvious
that the real reason for this neglect, as stated by the Department of
Communications, Information Technology and the Arts, was the “need to afford
maximum Parliamentary time to consider tax reform issues”. Treasury and the
Department of Communications, Information Technology and the Arts apparently
pursued GST issues so single-mindedly that they neglected to progress
legislation, legislation which the Treasurer had announced would be introduced,
that would have the effect of ensuring that spectrum licence holders, such as
mobile phone companies paid tax in Australia. This is an extremely
unsatisfactory state of affairs.
Labor
Senators will pursue these issues and look forward to receiving a proper
explanation from the Minister when the Radiocommunications Legislation
Amendment Bill 1999 is listed for discussion in the Senate. In particular,
Labor Senators will be interested in the alternate proposal put to the
Treasurer by the Minister for Communications, Information Technology and the
Arts in the Minister’s letters to the Treasurer dated November 10th
1998, and January 6th 1999.
SENATOR MARK BISHOP
ALP WESTERN AUSTRALIA |
SENATOR NICK BOLKUS
ALP SOUTH AUSTRALIA |
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