Scrutiny of Bills Alert Digest No. 5 of 1999

A New Tax System (Commonwealth-State Financial Arrangements) Bill 1999

This bill was introduced into the House of Representatives on 24 March 1999 by the Treasurer. [Portfolio responsibility: Treasury]

The bill proposes to:

entitle States and Territories to receive GST revenue grants from 1 July 2000;
provide that the GST rate and base are not to be altered without the unanimous agreement of the Commonwealth, State and Territory governments; and
make transitional arrangements.

The Committee has no comment on this bill.

A New Tax System (Commonwealth-State Financial Arrangements—Consequential Provisions) Bill 1999

This bill was introduced into the House of Representatives on 24 March 1999 by the Treasurer. [Portfolio responsibility: Treasury]

Consequent on the commencement of the proposed A New Tax System (Commonwealth-State Financial Arrangements) Act 1999 the bill proposes to:

amend the Local Government (Financial Assistance) Act 1995 to provide for local government funding transitional payments in 1999-2000 and provides for its repeal; and
repeals the States Grants (Local Purposes) Act 1994.

The Committee has no comment on this bill.

A New Tax System (Indirect Tax Administration) Bill 1999

This bill was introduced into the House of Representatives on 24 March 1999 by the Treasurer. [Portfolio responsibility: Treasury]

The bill proposes to amend the Taxation Administration Act 1953 to provide for the administration and collection of the wine equalisation tax and luxury car tax by the Commissioner of Taxation.

Reviewable decisions?

Schedule 1, item 66

Item 66 of Schedule 1 to this bill proposes to insert a new subsection 62(2A) in the Taxation Administration Act 1953. This subsection provides for review of a number of decisions under the Wine Tax Act. This Act is defined as the A New Tax System (Wine Equalisation Tax) Act 1999 (see item 10 of Schedule 1 to the bill).

However, there seems to be no correlation between the decisions listed in proposed subsection 62(2A) and the nominated provisions of the Wine Tax Act. For example, subsection 62(2A) states that refusing to register a person for wine tax under section 79 of the Wine Tax Act is a reviewable decision. There is no section 79 in the A New Tax System (Wine Equalisation Tax) Bill 1999. Similarly, cancelling a person's registration for wine tax under subsection 80(1) is said to be a reviewable decision. There is no subsection 80(1) in the A New Tax System (Wine Equalisation Tax) Bill 1999.

The Committee, therefore, seeks the Minister's advice as to which decisions are reviewable under proposed subsection 62(2A).

Pending the Minister's advice, the Committee draws Senators' attention to this provision, as it may be considered to make rights, liberties or obligations unduly dependent on non-reviewable decisions in breach of principle (1)(a)(iii) of the Committee's terms of reference.

A New Tax System (Luxury Car Tax) Bill 1999

This bill was introduced into the House of Representatives on 24 March 1999 by the Treasurer. [Portfolio responsibility: Treasury]

The bill proposes to implement a luxury car tax at the rate of 25 per cent on taxable supplies and importations of luxury cars, from 1 July 2000.

Insufficient Parliamentary scrutiny

Subclause 21-1(2)

Proposed subclause 21-1(1) of this bill exempts the Commonwealth and Commonwealth entities from actual liability for the payment of luxury car tax, but imposes on them a notional liability and requires them to notionally have luxury car tax adjustments. Proposed subclause 21-1(2) enables the Minister for Finance to give “such written directions” to give effect to this provision. By virtue of subclause 21-1(3), these directions override “any other Commonwealth law”.

Clearly, such directions permit changes to be made to the application of other laws passed by the Parliament. However, it is not apparent from the bill or the Explanatory Memorandum whether these directions are to be given only to entities which are part of the Commonwealth, or may also be given to entities which are separate from the Commonwealth. The Committee has previously accepted that such directions may be given to Commonwealth entities without qualification. However, where they are given to entities which are separate from the Commonwealth, then they should, at the very least, be disallowable.

The Committee, therefore, seeks the Minister's advice as to whether these directions may be given to non-Commonwealth entities, and, if so, why they should not be tabled and subject to Parliamentary scrutiny.

Pending the Minister's advice, the Committee draws Senators' attention to this provision, as it may be considered to insufficiently subject the exercise of legislative power to parliamentary scrutiny in breach of principle (1)(a)(v) of the Committee's terms of reference.

A New Tax System (Luxury Car Tax Imposition—Customs) Bill 1999

This bill was introduced into the House of Representatives on 24 March 1999 by the Treasurer. [Portfolio responsibility: Treasury]

The bill proposes to impose a luxury car tax, to the extent that it is a duty of customs, at the rate of 25 per cent on taxable supplies and importations of luxury cars.

The Committee has no comment on this bill.

A New Tax System (Luxury Car Tax Imposition—Excise) Bill 1999

This bill was introduced into the House of Representatives on 24 March 1999 by the Treasurer. [Portfolio responsibility: Treasury]

The bill proposes to impose a luxury car tax, to the extent that it is a duty of excise, at the rate of 25 per cent on taxable supplies and importations of luxury cars.

The Committee has no comment on this bill.

A New Tax System (Luxury Car Tax Imposition—General) Bill 1999

This bill was introduced into the House of Representatives on 24 March 1999 by the Treasurer. [Portfolio responsibility: Treasury]

The bill proposes to impose a luxury car tax, to the extent that it is neither a duty of excise nor a duty of customs, at the rate of 25 per cent on taxable supplies and importations of luxury cars.

The Committee has no comment on this bill.

A New Tax System (Wine Equalisation Tax and Luxury Car Tax Transition) Bill 1999

This bill was introduced into the House of Representatives on 24 March 1999 by the Treasurer. [Portfolio responsibility: Treasury]

The bill proposes to provide transitional arrangements for the wine equalisation tax and the luxury car tax, including:

a GST credit for a portion of the wholesale sales tax paid on stock that becomes subject to wine equalisation tax; and
that the proposed luxury car tax is not payable on cars sold by retail before 1 July 2000.

The Committee has no comment on this bill.

A New Tax System (Wine Equalisation Tax) Bill 1999

This bill was introduced into the House of Representatives on 24 March 1999 by the Treasurer. [Portfolio responsibility: Treasury]

The bill proposes to implement a wine equalisation tax at the rate of 29 per cent on assessable dealings and importations of wine made on or after 1 July 2000.

Insufficient Parliamentary scrutiny

Subclause 27-20(2)

Proposed subclause 27-20(2) of this bill exempts the Commonwealth and Commonwealth entities from actual liability for the payment of wine tax, but imposes on them a notional liability and requires them to notionally have wine tax adjustments. Proposed subclause 27-20(2) enables the Minister for Finance to give “such written directions” to give effect to this provision. By virtue of subclause 27-20(3), these directions override “any other Commonwealth law”.

A New Tax System (Wine Equalisation Tax Imposition—Customs) Bill 1999

This bill was introduced into the House of Representatives on 24 March 1999 by the Treasurer. [Portfolio responsibility: Treasury]

The bill proposes to impose a wine equalisation tax, to the extent that it is a duty of customs, at the rate of 29 per cent on assessable dealings and importations of wine made on or after 1 July 2000.

The Committee has no comment on this bill.

A New Tax System (Wine Equalisation Tax Imposition—Excise) Bill 1999

This bill was introduced into the House of Representatives on 24 March 1999 by the Treasurer. [Portfolio responsibility: Treasury]

The bill proposes to impose a wine equalisation tax, to the extent that it is a duty of excise, at the rate of 29 per cent on assessable dealings and importations of wine made on or after 1 July 2000.

The Committee has no comment on this bill.

A New Tax System (Wine Equalisation Tax Imposition—General) Bill 1999

This bill was introduced into the House of Representatives on 24 March 1999 by the Treasurer. [Portfolio responsibility: Treasury]

The bill proposes to impose a wine equalisation tax, to the extent that it is neither a duty of excise nor a duty of customs, at the rate of 29 per cent on assessable dealings and importations of wine made on or after 1 July 2000.

The Committee has no comment on this bill.

Adelaide Airport Curfew Bill 1999

This bill was introduced into the House of Representatives on 22 March 1999 by Mrs Gallus as a Private Member's bill.

The bill proposes to:

establish a curfew at Adelaide Airport between 11pm and 6am and impose a penalty for breach of the curfew;
impose a penalty of up to $22,000 for breach of the curfew;
provide for certain aircraft movements during the curfew;
allow the Minister to grant dispensations in certain circumstances;
empower authorised officers to request certain information and provide for penalties in relation to false information;
allow the Minister to delegate powers to grant permissions or give dispensations;
provide for appointment of authorised persons; and
provide guidance to a court in prosecutions for an offence by a body corporate.

Appointment of “a person” as an authorised officer

Subclause 22(1)

Proposed subclause 22(1) will permit the Secretary to the Department of Transport to appoint “a person” to be an authorised officer for the purposes of the Act. However, the bill gives no indication of the qualifications or attributes that such an appointee should possess.

Since its establishment, the Committee has consistently drawn attention to legislation which allows significant and wide-ranging powers to be delegated to “a person”. Generally the Committee likes to see some limits placed on potential delegates, whether by reference to them as holders of nominated offices, or as members of the Senior Executive Service, or by reference to their possession of special qualifications or attributes. Therefore, the Committee seeks the advice of the member sponsoring the bill as to whether subclause 22(1) should provide some limit on the otherwise unfettered discretion of the Secretary in appointing authorised officers.

Pending the member's advice, the Committee draws Senators' attention to this provision, as it may be considered to make rights, liberties or obligations unduly dependent on insufficiently defined administrative powers in breach of principle (1)(a)(ii) of the Committee's terms of reference.

Australian Broadcasting Corporation Amendment Bill 1999

This bill was introduced into the Senate on 25 March 1999 by Senator Bourne as a Private Senator's bill.

The bill proposes to amend the Australian Broadcasting Corporation Act 1983 to establish a Parliamentary Joint Committee on the ABC to:

examine the Australian Broadcasting Corporation's (ABC) annual report;
review the ABC's annual appropriations and make recommendations relating to the appropriations; and
approve or reject ministerial recommendations for Board appointments.

The Committee has no comment on this bill.

Australian Security Intelligence Organisation Legislation Amendment Bill 1999

This bill was introduced into the House of Representatives on 25 March 1999 by the Attorney-General. [Portfolio responsibility: Attorney-General]

The bill proposes to amend the following Acts:

Australian Security Intelligence Organization Act 1979 to:

enable the Minister to issue warrants to authorise ASIO to:
- access data which is relevant to security and stored in a specified computer;
- use a tracking device to assist in collecting intelligence relevant to security;
- examine an article being delivered by a delivery service provider;
authorise ASIO to enter premises for the purpose of removing a listening or tracking device which has been installed under warrant;
amend provisions relating to search warrants to:
- simplify the description of the matters about which the Minister must be satisfied before issuing a warrant;
- clarify ASIO's authority to use a computer found on the premises being searched;
- extend the maximum period a warrant may remain in force from seven to 28 days;
- permit the Minister to defer the commencement of a warrant for up to 28 days;
enable the Minister to authorise ASIO to collect intelligence by means that do not require a warrant, such as human resources;
extend the authority of the Director-General of Security to issue certain warrants in an emergency;
allow the Director-General of Security to charge fees to recover the cost of providing advice or services to persons at their request;
permit ASIO to communicate security assessments in relation to the 2000 Olympics or Paralympics directly to State authorities;
simplify the communication of criminal intelligence given to ASIO by overseas partner agencies to Australian law enforcement agencies;
enable regulations to be made to permit review bodies to consider decisions affecting former staff as well as current employees and allow immunity from civil proceedings to be conferred on review bodies; and
revise penalty provisions so that pecuniary penalties are calculated according to the Crimes Act 1914 formula;

Financial Transaction Reports Act 1988 to give ASIO access to information held by the Australian Transaction Reports and Analysis Centre;

Inspector-General of Intelligence and Security Act 1986 to:

make the monitoring role of the Inspector-General Intelligence and Security explicit;
allow the Inspector-General to remove taxation and identifying financial transaction reports information from his reports to Ministers;
amend clearance procedures when providing a written response to a complainant; and
permit disclosure of information by the Inspector-General if the safety of a person may be at risk;

Taxation Administration Act 1953 to allow the Commissioner of Taxation to disclose tax information to the Director-General of Security in certain circumstances; and

Australian Security Intelligence Organization Act 1979 to change “Organization” to “Organisation” and makes consequential amendments to 26 other Acts.

The Committee has no comment on this bill.

Compensation for Non-economic Loss (Social Security and Veterans' Entitlements Legislation Amendment) Bill 1999

This bill was introduced into the House of Representatives on 25 March 1999 by the Minister representing the Minister for Family and Community Services. [Portfolio responsibility: Family and Community Services]

The bill proposes to amend the Social Security Act 1991 and the Veterans' Entitlements Act 1986 to change how payments of compensation for non-economic loss are made by:

treating lump sum payments exceeding $10,000 as ordinary income (payments to be spread over the next 26 fortnights from receipt); and
treating periodic payments as ordinary income.

Commencement

Subclause 2(3)

By virtue of subclause 2(3), the amendments proposed in this bill are to commence up to 12 months after assent. This contrasts with the preferred period of 6 months set out in Drafting Instruction No 2 of 1989 issued by the Office of Parliamentary Counsel. The Drafting Instruction goes on to note that, where a period longer than 6 months is chosen, “Departments should explain the reason for this in the Explanatory Memorandum”.

While the Explanatory Memorandum accompanying this bill does not clarify the need for a period longer than 6 months, the Minister's Second Reading Speech suggests that, by delaying commencement “there will be sufficient flexibility to allow State and Territory Governments and insurers the opportunity to implement any desirable changes to the way their schemes operate in response to the introduction of this initiative”. This explains the need for an extended commencement period in the case of this bill.

In these circumstances, the Committee makes no further comment on these provisions.

Criminal Code Amendment (Slavery and Sexual Servitude) Bill 1999

This bill was introduced into the Senate on 24 March 1999 by the Parliamentary Secretary to the Minister for Communications, Information Technology and the Arts. [Portfolio responsibility: Justice and Customs]

The bill proposes to:

amend the Criminal Code Act 1995 to create offences relating to slavery, sexual servitude and deceptive recruiting for sexual services; and
repeal 6 Imperial Acts relating to slavery that still apply in Australia.

Penalties, definitions and the reversal of the onus of proof

Proposed new sections 270.1 and 270.3

Item 1 of Schedule 1 to this bill proposes to insert a new Division 270 in the Criminal Code. This new Division includes proposed section 270.3, which deals with slavery offences.

Proposed subsection 270.1 defines slavery as “the condition of a person over whom any or all of the powers attaching to the right of ownership are exercised, including where such a condition results from a debt or contract made by the person”. Proposed subsection 270.3(1) makes it an offence to possess a slave or exercise over a slave any of the other powers attaching to the right of ownership, or to engage in slave trading. The maximum penalty for this offence is imprisonment for 25 years.

Proposed subsection 270.3(3) states that a person who enters into a transaction with the intention of securing the release of a person from slavery is not guilty of an offence against the section. Proposed subsection 270.4(4) states that the defendant bears the legal burden of proving this matter. The Explanatory Memorandum notes that the effect of this provision is that, to establish the defence, the defendant must prove, on the balance of probabilities, that his or her intention was to release the person.

These provisions raise a number of issues. First, it is clear that the penalties to be imposed for slavery offences are significant, as, indeed, are the penalties for all the offences created by this bill. The Committee would appreciate some further advice about where these penalties stand in relation to the general range of penalties for similarly serious offences.

Secondly, the Committee would appreciate some further advice regarding the statutory definition of `slavery' – in particular, some indication of the range of situations to which it is intended to apply. The Committee notes that the Explanatory Memorandum states that whether a person is a slave “is a matter to be determined by the courts on a case by case basis” and that “slavery is more than merely the exploitation of another… it is where the power a person exercises over another effectively amounts to the power a person would exercise over property he or she owns”. For example, given that slavery may arise “from a debt owed or contract entered into by the enslaved person”, is the bill intended to apply to situations of forced labour in `sweatshops'?

Thirdly, the Committee notes that subclause 270.3 provides a defence of entering into a transaction “with the intention of releasing [a] person from slavery”. The defendant bears the legal burden of proving this defence. The Committee usually queries such reversals of the onus of proof, and would appreciate some further advice on the reason for its reversal in this instance. In particular, the Committee would appreciate advice on the reason for including this as a specific defence, and for imposing a “legal burden” on the defendant – in these circumstances, is a “legal burden” different from an evidential burden?

The Committee would also appreciate advice on the relationship between the intention to be proved by the prosecution in proving all the elements of the offence, and the intention to be proved by the defendant in proving this defence. For example, the Committee observes that a person charged with murder, where the issue of self-defence arises, cannot be convicted unless the prosecution proves beyond reasonable doubt that he or she did not act in self defence. Similarly, a person charged with rape cannot be convicted unless the prosecution proves beyond reasonable doubt that that person believed that the alleged victim was not consenting. This bill seems to impose a different burden on the prosecution in proving intent.

Therefore, the Committee seeks the Minister's advice about these matters.

Pending the Minister's advice, the Committee draws Senators' attention to this provision, as it may be considered to trespass unduly on personal rights and liberties in breach of principle (1)(a)(i) of the Committee's terms of reference.

Customs Amendment Bill (No. 2) 1999

This bill was introduced into the House of Representatives on 25 March 1999 by the Minister representing the Minister for Justice and Customs. [Portfolio responsibility: Justice and Customs]

The bill proposes to amend the Customs Act 1901 to introduce a registration and electronic cargo reporting scheme for owners of ships and aircraft bringing high volume low value consignments into Australia.

Old convictions, continuing consequences

Proposed new paragraph 67EB(3)(b)

This bill proposes to introduce a new registration and electronic cargo reporting scheme for owners of ships or aircraft bringing “high volume low value” cargo into Australia. Under the scheme, owners of ships and aircraft may apply for registration as “special reporters” and, if registered, are permitted to electronically report low value cargo in a less detailed form than is required by the Customs Act for other cargo.

Specifically, Item 12 of Schedule 1 to the bill proposes to insert a new Subdivision in the Customs Act 1901. This covers the registration, rights and obligations of `special reporters'. This new subdivision includes proposed new subsection 67EB(3), which sets out certain matters to which the CEO of Customs must have regard in deciding whether an applicant for registration is a fit and proper person.

Matters to which the CEO must have regard include:

whether the person has been convicted of an offence against the Customs Act within the previous 10 years;
whether the person is an insolvent under administration;
whether the person was, within the previous 2 years, concerned in the management of a company that had been wound up, or had had its registration as a special reporter cancelled; and
whether any misleading information or document has been furnished in relation to the application, or information or documents that are, to the knowledge of the applicant, false.

Some of these matters are clearly relevant to an applicant's fitness. However, under proposed subparagraph 67EB(3)(b), the CEO must also have regard to whether the person has been convicted of any offence against another law of the Commonwealth, or of a State or Territory, in the previous 10 years, where that offence is punishable by imprisonment for one year or longer. This provision raises a number of issues.

First, it seems retrospective. An applicant may have been convicted of an offence up to 10 years before the passing of this bill, and not been affected in any way by that conviction, but may now, years later, come to be denied registration as a consequence.

Secondly, the provision seems somewhat arbitrary. An applicant who applies for registration 10 years and 1 day after having committed such an offence is regarded as fully rehabilitated, and the fact of the conviction may not be taken into account. Were he or she to apply for registration 2 days earlier, the fact of the conviction must be taken into account. While any specified period may be seen as arbitrary, the Committee seeks advice as to the relationship of this 10 year period and limitation periods in other legislation.

Thirdly, the provision may be regarded as exposing a person to double punishment for the same offence. The view is commonly expressed that, once a person has completed a sentence of imprisonment for an offence, they have paid their debt to society and should be left to live their life without having to continually face the stigma of the sentence served. This provision, however, permits the fact of a conviction to affect aspects of an applicant's life for a further 9 years after that conviction has been dealt with.

Fourthly, the provision is potentially inequitable in referring to offences “punishable” by imprisonment for one year or longer. In its Seventh Report of 1998, in a somewhat different context (the voting rights of prisoners), the Committee referred to the potential unfairness of provisions which exclude rights by reference to the maximum penalty that is provided for, rather than the actual penalty imposed. Under proposed subparagraph 67EB(3)(b), a person who has actually served a sentence of imprisonment of 9 months for an offence which was punishable by imprisonment for 9 months would not have this sentence taken into account. However, a person who was fined $50 for an offence punishable by imprisonment for a year would have this sentence taken into account.

Under the proposed provision, a person's application for registration as a `special reporter' might be affected if, 10 years ago, they were convicted of using abusive language to a fisheries officer (see section 14(1)(f) of the Fisheries Act 1952 (Cth)), or stealing a dog (see section 132 of the Crimes Act 1900 (NSW)), or wrongfully delivering a postal article (see section 85N of the Crimes Act 1914 (Cth)).

Finally, the bill does not make clear how information about past convictions will come to the attention of the CEO considering an application. Is it intended that inquiries be made of law enforcement authorities around Australia, or will applicants be required to disclose previous convictions? If the latter approach is adopted, what consequences are envisaged should an applicant fail to disclose an old conviction for a relatively minor offence?

The Committee notes that the bill merely requires that past offences be taken into account in considering an application – such offences do not necessarily preclude registration. However, there is a real possibility that such a provision may lead to the rejection of an application in circumstances of apparent unfairness and, notwithstanding the additional appeal provisions, this situation is unsatisfactory. Therefore, the Committee seeks the Minister's advice about these matters.

Damage by Aircraft Bill 1999

This bill was introduced into the House of Representatives on 24 March 1999 by the Minister for Transport and Regional Services. [Portfolio responsibility: Transport and Regional Services]

The bill proposes to improve compensation arrangements for members of the public who suffer death, injury or damage as third parties on the ground involving an aircraft that comes within Commonwealth jurisdiction. The bill further proposes to repeal the Civil Aviation (Damage by Aircraft) Act 1958.

Commencement on Proclamation

Subclause 2(1)

By virtue of subclause 2(1), this bill is to commence on Proclamation, with no further date fixed by which it must either commence or lapse. The Committee usually draws attention to such provisions in the context of Drafting Instruction No 2 of 1989, issued by the Office of Parliamentary Counsel.

However, the Explanatory Memorandum notes that this bill has been introduced to remedy major deficiencies in the Civil Aviation (Damage by Aircraft) Act 1958, which gives effect to the 1952 Rome Convention on Damage Caused by Foreign Aircraft to Third Parties on the Surface. The bill's commencement depends on Australia's denunciation of the Rome Convention. Such a circumstance is one of the recognised exceptions to the Drafting Instruction noted above.

In these circumstances, the Committee makes no further comment on this provision.

Import Processing Charges Amendment Bill 1999

This bill was introduced into the House of Representatives on 25 March 1999 by the Minister representing the Minister for Justice and Customs. [Portfolio responsibility: Justice and Customs]

Complementary to the Customs Amendment Bill (No. 2) 1999, the bill proposes to amend the Import Processing Charges Act 1997 to impose a lower amount screening charge to apply to those owners of a ship or aircraft who are registered as special reporters under the electronic cargo reporting scheme.

Retrospective application

Subclause 2(2)

By virtue of subclause 2(2) of this bill, item 1 of Schedule 1 is to commence retrospectively on 26 February 1997. This item proposes to amend the definition of the term line in section 3 of the Import Processing Charges Act 1997. The Explanatory Memorandum states that this amendment implements the original intention of the framers of the legislation. However, the Explanatory Memorandum does not indicate whether this retrospectivity will adversely affect any importers of goods who would now come within the scheme. Therefore, the Committee seeks the Minister's advice as to whether this retrospectivity will adversely affect any person.

Pending the member's advice, the Committee draws Senators' attention to this provision, as it may be considered to trespass unduly on personal rights and liberties in breach of principle (1)(a)(i) of the Committee's terms of reference.

Telecommunications Laws Amendment (Universal Service Cap) Bill 1999

This bill was introduced into the House of Representatives on 25 March 1999 by the Minister representing the Minister for Communications, Information Technology and the Arts. [Portfolio responsibility: Communications, Information Technology and the Arts]

The bill proposes to amend the Telecommunications Act 1997 and the proposed Telecommunications (Consumer Protection and Service Standards) Act 1999 to impose a cap on the net universal service cost for the 1997-98, 1998-99 and 1999-2000 financial years.

The Committee has no comment on this bill.