Showing posts with label taxation. Show all posts
Showing posts with label taxation. Show all posts

Friday, 13 October 2017

File this one under 'Who's guarding the guards?'


The politicians forming Australian state and federal governments assure us they are upright, ethical people with histories as pure as the driven snow. They tell us their advisors are trustworthy beyond doubt and their senior public service appointees & finance/security consultants ditto. While their big business mates like Gina, Twiggy and Co are genuinely true blue and philanthropic.

Yet, as step by step these same politicians lead us towards authoritarian governance and Big Brother mass surveillance, their feet of clay can’t help but show.

North Coast Voices readers may remember that SMEC Holdings Limited (now SMEC and Surbana Juronghas been a favourite of Malcolm Turnbull's since he was the Minister for the Environment and Water Resouces in the Howard Government ministry.

This company provided an error-ridden desktop study for Turnbull supporting damming and diverting water from NSW North Coast river systems, with a preference for visiting this environmental vandalism on the Clarence River system.

It is now allegedly a corrupt multinational corpration.

The Age, 4 October 2017:

An arm of the company tasked with advising the Turnbull government on its signature infrastructure project, Snowy Hydro 2.0, has been banned by the World Bank for alleged bribery and corruption, prompting further calls for a federal anti-corruption watchdog……

Prime Minister Malcolm Turnbull poses for a photo during his announcement of Snowy Hydro 2.0 in March.
Photo: Alex Ellinghausen

Engineering company SMEC had five of its subsidiaries banned by the World Bank last week after an investigation into "inappropriate payments" linked to projects in Sri Lanka and Bangladesh. 

SMEC was chosen to undertake the $29 million feasibility study back in May and the work is due to be finished by the end of the year. The firm was selected by the state and federal government-owned Snowy Hydro corporation, which runs the current power plant.

Last year, Fairfax Media revealed the details of some of the allegations around improper payments involving SMEC, including allegedly corrupt dealings between the firm and Sri Lankan president Maithripala Sirisena when he was a cabinet minister in 2009.

Those dealings and others are still under investigation by the federal police.

This is one wealthy individual audited by the Australian Taxation Office - venture capitalist and independent consultant to business & government for over twelve years, Anthony ‘Tony’ Castagna.

The Sydney Morning Herald, 7 October 2017:

Anthony Castagna's company helps protect the cyber secrets and detect financial crimes within the world's most powerful institutions, including the Serious Fraud Office in Britain, US Homeland Security, the Australian defence force, ASIC, even the Office of the President of the US.

Now the Sydney-based co-founder and chairman of Nuix, majority owned by Macquarie Bank, faces a potential 20-year jail term after being charged with tax evasion and dealing with the proceeds of crime.

Dr Castagna, 70, has been the target of two of Nuix's major clients: the Australian Federal police and the Australian Tax Office through Project Wickenby, their long-running tax probe.

The charges relate to payments from Macquarie Bank which were allegedly channelled into offshore companies controlled by his cousin Robert Agius, who was sentenced to a non-parole period of 6 years and 8 months' jail in 2012 for operating unrelated tax avoidance schemes via his Vanuatu-based accountancy firm.

In addition to Dr Castagna's criminal charges, the ATO is pursuing him for unpaid taxes and penalties in excess of $10 million.

For decades, the tech guru has been a rainmaker for Macquarie Bank. The bank has ploughed millions of dollars into his cyber security and forensic services company Nuix. A totally owned Macquarie Group subsidiary owns more than 70 per cent of Nuix and over the last year Macquarie advisors have been talking up a billion-dollar float of Nuix on the Australian stock exchange....

Dr Castagna, who denies any wrongdoing and is vigorously defending the charges....

Wednesday, 11 October 2017

Facebook Inc continues to test the world's patience when it comes to privacy issues and US patience in relation to taxation matters


Worldwide Facebook Inc is estimated to have 2.01 billion monthly active users, with est. 1.7 billion of these users living outside of the USA and Canada.

Australian users comprised 17 million of these account holders in August 2017 - 12 million logging in daily.

In pursuit of profit this social media company is a ruthless data miner – collecting and collating information about every available aspect of the lives of all holders of Facebook accounts.

A fact that makes this company’s users a target of US federal government mass surveillance.

Given that Facebook Inc created a holding company Facebook Ireland Ltd in the low-taxing Republic of Ireland and it is this company which appears to legally possess the data of those est.1.7 billion users, it now finds itself before European Union courts.

Privacy activist @maxschrems, 3 October 2017:

Facebook operates its international business outside of the United States and Canada via a separate company in Ireland called “Facebook Ireland Ltd”. 85.9% of all worldwide Facebook users (everyone except USA and Canada) are managed in Dublin (Link), which is understood to be part of Facebook’s tax avoidance scheme.

Facebook currently sends all user data to its parent company, “Facebook Inc.” in the United States for processing. European law (Articles 25 and 26 of Directive 95/46/EC) requires that data can only be transferred outside of the EU if the personal data is “adequately protected”. This is in conflict with US mass surveillance laws, which “Facebook Inc.” in the USA is subject to.

Max Schrems: “In simple terms, US law requires Facebook to help the NSA with mass surveillance and EU law prohibits just that. As Facebook is subject to both jurisdictions, they got themselves in a legal dilemma that they cannot possibly solve in the long run.”

The Data Protection Commissioner in Ireland is investigating a complaint made by Max Schrems, an Austrian student with a Facebook account. This complaint relates to the transfer of his data by Facebook Ireland to Facebook Inc. in the United States for processing - an act which is alleged to violate European fundamental rights under Articles 7, 8 and 47 of the European Charter of Fundamental Rights.


The subsequent investigation by the Data Protection Commissioner has given rise to a High Court case in Ireland (3 October 2017 judgement). The Court has now referred the issue of the validity of the European Commission’s Standard Contractual Clause decisions to the Court of Justice of the European Union for a preliminary ruling.

History of the Case according to Max Schrems:
The case is based on a complaint, filed by Mr Schrems against Facebook in 2013:

* The case is based on a complaint [PDF] brought by Mr Schrems against Facebook Ireland Ltd. before the Irish Data Protection Commissioner (“DPC”) in 2013 (4 years ago).
* The DPC first refused to investigate the complaint, calling it “frivolous”, but Mr Schrems subsequently succeeded before the CJEU, which overturned the “Safe Harbor” (a EU-US data sharing system) in 2015 [case C-362/14] and ruled that the DPC must investigate the complaint.
* After the invalidation of “Safe Harbor”, Facebook used another legal tool to transfer data outside of the EU, called “Standard Contractual Clauses” (SCCs) [Facebook’s SCCs - PDF].
* SCCs are a contract between Facebook Ireland and Facebook USA, where Facebook USA pledges to follow EU privacy principles [official EU Info Page].
* The case subsequently continued with an updated complaint [PDF] in 2015. The Irish DPC joined Mr Schrems view that the SCCs cannot overcome fundamental problems under US surveillance laws, and specifically agreed that there is no proper legal redress in the United States in such cases. Other issues raised in Mr Schrems complaint have not been investigated yet.
* The DPC refused to use its power to suspend data flows of Facebook as asked by Mr Schrems.
* Instead of only prohibiting Facebook’s EU-US data transfers under Article 4 of the SCCs, the DPC took the unusual move of issuing proceedings against Facebook Ireland Ltd. and Mr Schrems before the Irish High Court. In the procedure the DPC aims to invalidate the SCCs entirely by referring the case to the European Court of Justice (CJEU) in Luxembourg.
*The case was heard for five Weeks in February 2017. The United States Government was joined as an “amicus” to the case, along two industry lobby groups and the US privacy non-profit “EPIC”.

Facebook Inc’s "Double Irish" tax avoidance scheme and other matters also saw it before a US court in 2016, having refused to comply with a number of IRS tax summons. The court case continues to date.

The IRS 2008-2010 audit of Facbook Inc resulted in an assessment of the intangible assets transferred in those years having a value of US $13.8 billion, increasing Facebook's 2010 income by US $84.9 million and causing an income tax deficiency for the parent company.

Excerpt from United States Securities And Exchange Commission filing by Facebook Inc for the quarterly period ended June 30, 2016:

We are subject to taxation in the United States and various other state and foreign jurisdictions. The material jurisdictions in which we are subject to potential examination include the United States and Ireland. We are under examination by the Internal Revenue Service (IRS) for our 2008 through 2013 tax years. Our 2014 and subsequent years remain open to examination by the IRS. Our 2011 and subsequent years remain open to examination in Ireland. We do not anticipate a significant impact to our gross unrecognized tax benefits within the next 12 months related to these years. On July 27, 2016, we received a Statutory Notice of Deficiency (Notice) from the IRS relating to transfer pricing with our foreign subsidiaries in conjunction with the examination of the 2010 tax year. While the Notice applies only to the 2010 tax year, the IRS states that it will also apply its position for tax years subsequent to 2010, which, if the IRS prevails in its position, could result in an additional federal tax liability of an estimated aggregate amount of approximately $3.0 - $5.0 billion, plus interest and any penalties asserted. We do not agree with the position of the IRS and will file a petition in the United States Tax Court challenging the Notice. If the IRS prevails in the assessment of additional tax due based on its position, the assessed tax, interest and penalties, if any, could have a material adverse impact on our financial position, results of operations or cash flows. [my yellow bolding]

Monday, 21 August 2017

I wonder if Liberal and Nationals MPs and senators remember that Adani's corporate structure in Australia is allegedly also geared towards siphoning money into tax havens?


The Guardian, 16 August 2017:

A global mining giant seeking public funds to develop one of the world’s largest coal mines in Australia has been accused of fraudulently siphoning hundreds of millions of dollars of borrowed money into overseas tax havens.

Indian conglomerate the Adani Group is expecting a legal decision in the “near future” in connection with allegations it inflated invoices for an electricity project in India to shift huge sums of money into offshore bank accounts.

Details of the alleged 15bn rupee (US$235m) fraud are contained in an Indian customs intelligence notice obtained by the Guardian, excerpts of which are published for the first time here.

The Directorate of Revenue Intelligence (DRI) file, compiled in 2014, maps out a complex money trail from India through South Korea and Dubai, and eventually to an offshore company in Mauritius allegedly controlled by Vinod Shantilal Adani, the older brother of the billionaire Adani Group chief executive, Gautam Adani.

Vinod Adani is the director of four companies proposing to build a railway line and expand a coal port attached to Queensland’s vast Carmichael mine project.

The proposed mine, which would be Australia’s largest, has been the source of years of intense controversy, legal challenges and protests over its possible environmental impact.

Expanding the coal port to accommodate the mine will require dredging an estimated 1.1m cubic metres of spoil near the Great Barrier Reef marine park. Coal from the mine will also produce annual emissions equivalent to those of Malaysia or Austria according to one study.

One of the few remaining hurdles for the Adani Group is to raise finance to build the mine as well as a railway line to transport coal from the site to a port at Abbot Point on the Queensland coast.

To finance the railway Adani hopes to persuade the Northern Australia Infrastructure Facility (Naif), an Australian government-backed investment fund, to loan the Adani Group or a related entity about US$700m (A$900m) in public money.

Adani family’s Australian corporate structure…..

ABC News, 14 March 2017:

Up to $3 billion from Adani's planned Carmichael coal mine will be shifted to a subsidiary owned in the Cayman Islands if the controversial project goes ahead, an analysis of company filings shows.

An "overarching royalty deed" gives a shell company rights to receive a $2-a-tonne payment, rising yearly by the inflation rate, beyond the first 400,000 tonnes mined in each production year for two decades.

The company with this entitlement is ultimately owned by Atulya Resources Limited, a secretive entity registered in the Cayman Islands, and controlled by the Adani family.

"In plain English, the upshot for the Adani family is [that] if the mine goes ahead, they receive a $2-a-tonne payment, so up to $3 billion, via a Cayman Islands company, a company owned in a tax haven," says Adam Walters, principal researcher and Energy Resource Insights.

With a production capacity of 60 million tonnes or more a year, that amounts to about $120 million per annum in payments, increasing each year in line with the CPI, potentially flowing offshore.

"I would describe it as a structure that means that the Adani family enriches themselves if the mine goes ahead but that other shareholders are impoverished," associate professor Thomas Clarke, director of the Centre for Corporate Governance at UTS told the ABC.

"The worry is that this may be just the beginning.

"That the Adani family have the ability to shift cash and assets around at will and in the future they may well do so at the cost of shareholders and the Queensland economy."

He said the billions flowing to the Adani private company would come at the expense of minority shareholders in the company listed on the Bombay stock exchange which ultimately owns the Carmichael mine.

How Adani acquired the right to this multi-billion-dollar revenue stream is a tale in itself.

In 2010, Adani Mining Pty Ltd bought the coal tenement that is set to become the Carmichael mine from the now defunct Linc Energy.

Part of the sale involved Adani Mining giving Linc Energy an "overriding royalty deed" which entitled it to receive $2-a-tonne for all coal mined beyond the first 400,000 tonnes in any production year.

Linc Energy informed investors at the time could be worth "over $120 million per annum" and up to $3 billion over the course of the royalty right.

But in August 2014, in dire financial straits, Linc Energy agreed to sell the royalty deed back to Adani at a fire sale price: just $150 million.

The obvious course would have been to extinguish the royalty deed, because it represented a multi-billion-dollar liability for the mine which is ultimately owned by Adani Enterprises Ltd, the Bombay-stock exchange listed company.

Instead, the royalty deed "was assigned by Linc Energy Limited to Carmichael Rail Network Pty Ltd as trustee for Carmichael Rail Network Trust," notes in financial reports of Adani Mining Pty Ltd say.

Carmichael Rail Network is one of a group of companies behind the proposed North Galilee Basin rail line, which Adani is currently seeking a subsidised loan of up to $1 billion from the Federal Government's Northern Australia Infrastructure Facility to build.

"What this means is that one of the companies currently seeking up to $1 billion in public subsidy is going to profit to the tune of up to $3 billion if the mine goes ahead," Mr Walters said.

Adani Mining Pty Ltd, the proponent of the Carmichael mine and the holder of its environmental approvals, appears to have lent Carmichael Rail the funds to buy the royalty deed.

BACKGROUND

The Guardian, 21 August 2015:

We know that Abbott loves coal and thinks that it is “good for humanity”. Is that why he is prepared to back a financially risky project?

Is it the “10,000” jobs that government ministers say will come from the project (remembering that Adani’s own consultant has said that those numbers were vastly overblown and that Carmichael would result in less less than 1500 jobs).

Could it be the prospect of cash from coal royalties? Maybe.

Does the substantial media coverage from the mine just give the Abbott Government another opportunity to tell the public that all environmentalists are economic saboteurs who want to take away people’s jobs and come in the dead of night to steal your babies? Possibly.

But could there be another causal factor that has contributed to the way Australian politicians have forcefully backed Adani for so many years?

Could that other factor be the close relationships that the company has managed to forge at the highest levels with Australia’s political leaders?

Whenever an Australian leader sets foot in India, it seems that a meeting with Gautam Adani is never more than a figurative (and sometimes literal) flight in a private jet away.

There’s evidence of this going back at least as far as October 2010 and its there in the records of trade missions tabled before parliaments.

Let’s peruse together.

In October 2010, Queensland’s then Premier Anna Bligh travelled to India on a trade mission to promote the state’s bid to host the Commonwealth Games and “strengthen Queensland’s position as an ally and destination for future trade and investment in the eyes of the Indian market and nation leaders”.

report tabled to the Queensland Parliament shows that Bligh’s first official meeting with Indian figures was with Adani, where the company’s owner Gautam Adani and his international development executive Harsh Mishra got to quiz the Premier about policies relating to rail lines, underground coal gasification and support for mining in the Galilee Basin.

Bligh also “agreed to attend the opening” of Adani’s offices in Brisbane later that month and extended an invitation for Adani to meet with its co-ordinator general when they were next in Brisbane.

After Campbell Newman won power for the Liberal National Party in Queensland, he led a trade mission to India too.

While there, Newman joined former Labor Resources Minister Martin Ferguson and a 76-strong business delegation for a tour of an Adani port and a power plant, reportedly getting there on a private jet.

The report on the trade mission, tabled to Parliament, shows that Mr Adani then hosted a lavish reception at his home for the entire delegation.
Judging by one freelance photographer’s images, the event was quite an affair with much handshaking all-round.

The event was part of “OzFest” – Australia’s “largest cultural festival” for which Adani was a “platinum sponsor”

In 2013, the Queensland Government was again in India for a trade mission led by then Deputy Premier Jeff Seeney and, again, the Adani company was on hand.

Seeney’s delegation travelled with Adani executive Harsh Mishra to visit an Adani-owned port and power station before Seeney had a private lunch with the company.

Later that same day, Seeney met with Gujarat Chief Minister Narendra Modi (now the Indian Prime Minister) and… Gautum Adani.

Mr Adani then hosted a private dinner with Seeney “which included Adani Group senior executives and members of Mr Adani’s family”.

But it’s not only Queensland politicians who have sought out Adani company bosses while on missions to India.

Former New South Wales Premier Barry O’Farrell met with Gautam Adani during a trade visit to India in December 2013.

Current NSW Premier Mike Baird also went on a trade mission to India earlier this year. You can probably guess by now the name of one Indian billionaire he met with.

Gautam Adani is also a co-chair of the Australia-India CEO Forum – an initiative of the Australian High Commission.

Trade minister Andrew Robb attended the last meeting in New Delhi. I don’t know if they had dinner (but if I was a betting man….)

Sunday, 20 August 2017

This isn't the first time Coalition MPs have lied about costings


“FEDERAL Opposition Leader Bill Shorten's populist "tax grabs" would cost Australians an eye-watering $150 billion over 10 years, the Federal Government will reveal today……Independent modelling by the Parliamentary Budget Office (PBO) and Treasury shows that under a Shorten government small business, mum and dad investors, older Australians and higher-income earners would be slapped with higher taxes.” [The Northern Star, 14 August 2017]

The Parliamentary Budget Office exposes the lie………


This is not the first time a Coalition MP has uttered political lies about costings. Tony Abbott, Joe Hockey and Andrew Robb became rather famous for it.

ABC News, 11 October 2010:

The Federal Government says the Coalition did not tell the truth before the last election when it claimed to have had its costings audited.
The Opposition did not submit its costings to Treasury before the election, but said they had been audited by a big accountancy firm.
Fairfax newspapers quote letters between the Liberal Party and the accountants saying the work would not constitute an audit in accordance with Australian standards.

And conservative politicians wonder why the general public perceives such a yawning credibility gap.

Thursday, 17 August 2017

The NSW Northern Rivers have been asking for a fair go for decades

                          
To be filed under The more thing change the more things stay the same……….

Saturday, 7 March 1931

Trove, retrieved 13 August 2017

Monday, 31 July 2017

Why doesn't the Turnbull Government do more to address domestic tax avoidance?


So why is it that the Turnbull Coalition Government, home to more than one millionaire, continues to allow a set of taxation rules which favour those with both wealth and high incomes over those with only average to low incomes and little to no wealth?


According to the Australian Taxation Office (ATO) – now underfunded, undermanned and demoralised – there is an issue with trusts being used for tax avoidance:

We focus on differences between distributable income of a trust and its net [taxable] income which provides opportunities for those receiving the economic benefit of trust distributions to avoid paying tax on them.

In other words; discretionary trusts are used by high-income earners to distribute investment income to beneficiaries on lower marginal tax rates, in the process reducing the overall amount of tax paid and current rules allow income to be diverted to other family members, such as stay-at-home mothers or fathers, or to dependents over the age of 18, such as children at university, college or Tafe.

Australian Finance Minister and Liberal Senator for Western Australia Mathias Cormann characterises proposals to alter taxation rates on trusts to minimise their use as tax avoidance vehicles as a “tax grab”. Well he would wouldn’t he, with so many political mates to defend.

As for collecting existing tax liabilities……

The ability to enforce payment obligations and pursue avoidance schemes has diminished since 2014 when first the Abbott Coalition Government and then later the Turnbull Coalition Government cut ATO staffing numbers.

The Community and Public Sector Union clearly told the Treasurer in 2017 that:

While the public is supportive of tackling corporate tax avoidance to raise revenue for public services, there are limits to what the ATO is able to do due to significant under resourcing. Despite a growing population and increased expectations from the community, ATO ongoing staffing levels have declined. Between 2013-14 and 2015-16, Average Staffing Levels at the ATO fell by over 4,000 or by nearly a quarter. The audit team, responsible for enforcing the tax compliance of individuals and multinational companies, was hit particularly hard by these job cuts. While there was an increase in the 2016-17 Budget, it has not reversed the significant cuts experienced over the last few years.

Given the need for more, not less revenue, these previous cuts seem illogical. According to information provided to Senate Estimates by senior ATO staff, the return on investment over the last decade would be between 1:1 and 6:1, or simply put every dollar invested in ATO staff generates between $1 and $6 in revenue.[1] Some had previously estimated that the cuts could lead to a loss of nearly $1 billion in revenue.[2]

This disconnect between public expectations that tax avoidance should be tackled and what the ATO can actually do must be addressed by the Government. It should commit to an increase in base funding and staffing for the ATO if it is serious about tackling corporate tax avoidance and increasing revenue.

It seems that while the Turnbull Government talks about an ideal egalitarian society where inequality no longer exists, behind the scenes it is nobbling one of the mechanism’s available to government to ensure that there is a level playing field for all those with only earned incomes as well as those with earned incomes plus accumulated wealth.                                      
So when Turnbull & Co announced in May this year that it intends introducing a strong Diverted Profits Tax and establishing a Tax Avoidance Taskforce in the Australian Taxation Office (ATO) one has to wonder if current staffing levels allow full investigation of multinationals operating in Australia or whether the taskforce (which has in fact existed since 2016) will be adequately resourced to look into multinational tax avoidance and the black economy as mooted.

One also has to wonder why in the face of widespread use of negative gearing of investment properties and capital gains tax arrangements to avoid paying an appropriate tax rate, the Turnbull Government also fails to reform the taxation system in these areas.

Oh, I forgot……………



NOTE

1. Table 1: 45th Parliament of the Commonwealth of Australia party representation

Source: Australian Electoral Commission (AEC), ‘2016 Federal Election Tally Room’

Friday, 14 July 2017

Top 100 fossil fuel companies produce nearly 1 trillion tonnes of global greenhouse gas emissions



All 100 fossil fuel companies in this study collectively accounted for “72% of global industrial GHG emissions”.

Coincidentally the fossil fuel and mining sectors are some of the most heavily government-subsidised sectors globally - as well as featuring prominantly in lists of multinational corporations paying little or no tax in the countries in which they operate.

Top 50 fossil fuel companies accounting for half of total global industrial GHG Emissions in 2015

Saudi Arabian Oil (Aramco)
Gazprom
National Iranian Oil
Coal India
Shenhua Group
Rosneft OAO
China National Petroleum Corp CNPC
ADNOC
ExxonMobil Corp
Petroleos Mexicanos (Pemex)
Royal Dutch Shell PLC
Sonatrach SPA
Kuwait Petroleum Corp
BP PLC
Qatar Petroleum Corp
Petroleos de Venezuela SA (PDVSA)
Peabody Energy Corp
Iraq National Oil Co
Petroleo Brasileiro SA (Petrobras)
Chevron Corp
Datong Coal Mine
Lukoil OAO
China National Coal
Petroliam Nasional Berhad (Petronas)
Nigerian National Petroleum Corp
Shanxi Coking Coal Group Co Ltd
BHP Billiton Ltd
Shandong Energy
Total SA
Glencore PLC
Shaanxi Coal Chemical Industry Group Co Ltd
Poland Coal
Yankuang
Statoil ASA
Arch Coal Inc
Eni SPA
ConocoPhillips
SUEK
Kazakhstan Coal
TurkmenGaz Sasol Ltd
Anglo American
Henan Coal Chem.
Jizhong Energy
Surgutneftegas OAO
Shanxi Jincheng
Sinopec
Kailuan
Bumi
CNOOC
Shanxi Lu’an

Here are 15 of the remaining 50 highest polluting fossil fuel companies

Russia (Coal)
Abu Dhabi National Oil Co
Rio Tinto
Alpha Natural Resources Inc
PT Pertamina
National Oil Corporation of Libya
Consol Energy Inc
Ukraine Coal
RWE AG
Oil & Natural Gas Corp Ltd
Repsol SA
Anadarko Petroleum Corp
Egyptian General Petroleum Corp
Petroleum Development Oman LLC
Czech Republic Coal

Friday, 23 June 2017

When Labor senators play petty politics and women literally pay the price


On 19 June 2017 The Greens Senator Larissa Waters moved an amendment to the Treasury Laws Amendment (GST Low Value Goods) Bill 2017.

This amendment sought to remove the Goods and Services Tax (GST) from sanitary products used by the vast majority of Australian women and girls during their reproductive years.

The Australian Parliament Senate Hansard recorded the fate of this proposed amendment of 19 June 2017 at Page 17:

The TEMPORARY CHAIR (Senator Leyonhjelm): The question is that amendments (1) to (4) on sheet 8153 be agreed to.
Question agreed to.
Senator WATERS (Queensland—Co-Deputy Leader of the Australian Greens) (11:52): I move amendment (1) on sheet 8156:
(1) Page 27 (after line 16), at the end of the Bill, add:
Schedule 2—Exemptions
A New Tax System (Goods and Services Tax) Act 1999 1 At the end of Subdivision 38-B
Add:
38-65 Sanitary products
A supply of *sanitary products is GST-free.
2 Section 195-1
Insert: sanitary products means tampons, sanitary pads, panty liners and similar items.
3 Application
The amendments made to the A New Tax System (Goods and Services Tax) Act 1999 by this Schedule apply in relation to supplies made on or after 1 July 2017
…………..

The CHAIR: The question is that amendment (1) on sheet 8156 as moved by Senator Waters be agreed to. The committee divided. [12:07] (The Chair—Senator Lines)

Ayes ......................15
Noes ......................33
Majority...................18

AYES
Di Natale, R
Gichuhi, LM
Griff, S
Hanson-Young, SC
Hinch, D
Kakoschke-Moore, S
Leyonhjelm, DE
Ludlam, S
McKim, NJ
Rhiannon, L
Rice, J
Siewert, R (teller)
Waters, LJ
Whish-Wilson, PS
Xenophon, N

NOES
Bernardi, C
Burston, B
Bushby, DC
Chisholm, A
Cormann, M
Dodson, P
Duniam, J
Farrell, D
Fawcett, DJ
Fierravanti-Wells, C
Gallagher, KR
Georgiou, P
Hanson, P
Hume, J
Ketter, CR
Kitching, K
Lines, S
McAllister, J (teller)
McCarthy, M
McGrath, J
McKenzie, B
Moore, CM
Nash, F
Payne, MA
Pratt, LC
Reynolds, L
Roberts, M
Ryan, SM
Sinodinos, A
Smith, D
Sterle, G
Watt, M
Williams, JR

Question negatived.
Bill, as amended, agreed to.
Bill reported with amendments; report adopted.

Noticeably absent for this particular vote were all 26 Labor senators.

The House of Representatives passed the Treasury Laws Amendment (GST Low Value Goods) Bill 2017 (with the four other Senate amendments agreed to) on 21 June 2017.

Females of all ages who still have their menses will continue to pay GST on the sanitary items necessary for their general health and wellbeing.

I'll remember to 'thank' those missing Labor senators at the ballot box, along with those senators who voted Senator Waters' amendment down.

In my case that means not voting for NSW senators Sam Dastyari, Jenny McAllistar, Deborah O'Neill and Doug Cameron (all Labor), along with Brian Burston (One Nation), Concetta Fierravanti-Wells, Fiona Nash, Marise Payne  and Arthur Sinodinos (Liberal) & John Williams (Nationals).

Saturday, 27 May 2017

Quotes of the Week


Why do so few make it out of poverty? I can tell you from experience it is not because some have more merit than others. It is because being poor is a high-risk gamble. The asymmetry of outcomes for the poor is so enormous because it is so expensive to be poor. Imagine losing a job because your phone was cut off, or blowing off an exam because you spent the day in the ER dealing with something that preventative care would have avoided completely. Something as simple as that can spark a spiral of adversity almost impossible to recover from. The reality is that when you’re poor, if you make one mistake, you’re done. Everything becomes a sudden-death gamble. [Christian H. Cooper writing at Nautilus on Why Poverty Is Like A Disease, 20 April 2017]

The total rate paid by a high earner on $200,000 is nothing like 50 per cent. The first $18,200 isn't taxed at all because of the tax-free threshold, the next $18,000 is only taxed at 19 per cent, and so on, meaning the total tax taken works out at $71,232 including levies – a rate of 35.6 per cent. [Economic Editor for The Age, Peter Martin, writing on 24 May 2017]

Monday, 22 May 2017

A gender lens on the 2017-18 Budget exposes its class-ridden, misogynistic bottom line


In 2014 the Abbott Government ceased the thirty year-old federal government practice of releasing a Women's Budget Statement.

The National Foundation for Australian Women stepped in to fill the gap since then and this month has released its 97-page review of the Turnbull Government’s 2017-18 Budget, Gender lens on the Budget.

This budget review contains little that is unequivocally positive for women and summarises the bad news thus:

Women are overrepresented at lower income levels. Changes to government benefits and increases in taxes have a disproportionate effect on women. ATO statistics recently released show the median income for women was $47,125 in 2014-15, while for men the amount was $61,711.
Effective marginal taxation rates (EMTRs) measure the proportion of each extra dollar of earnings that is lost to both income tax increases and decreases in government benefits (for example, Parenting Payment, Family Tax Benefit, the Age Pension etc).
The increase in the Medicare Levy will affect those on incomes greater than $21,644. For those with eligible children, FTB A payment rates are frozen for two years. Those who pay child care fees will continue to face high EMTRs. University graduates will start repaying loans when they reach income levels of $42,000 per year.
These changes hit those on earning well below the average wage, and are particularly harsh for women. Combined, these changes could lead to effective marginal tax rates of possibly 100% or higher for some women, particularly as Family Tax Benefit Part A begins to decrease at $51,903. Graduates caught between these policies will experience considerable financial stress; graduates earning $51,000, most of whom are likely to be women, will have less disposable income than someone earning $32,000. Changes to penalty rates may also have a significant impact on some graduates if they are extended to the aged and health care sectors as well as the childcare sector.
The point to note is not just the harsh effects on low income women but also that it is not discussed in the Budget papers, with no modelling of the exact EMTRs for different groups of women provided. The way to improve incomes for most women is not to cut taxes but through improved welfare, social investments and increased wages (for example, by taking real action against the spread of precarious low paid work or by opposing cuts to penalty rates). Tax cuts, particularly those for top income earners, lower revenue at a time when investment is needed in public services and social infrastructure. ATO statistics show that in 2013-14 only 17% of women had taxable incomes greater than $80,000. This tax reduction has led to an increase in gender inequality.
Welfare payments to the unemployed are a small part of total welfare outlays. However, as ACOSS points out, the 2014 demonising of recipients continues. Many groups argue for an increase in the value of the Newstart payment, and an increase in Commonwealth rent assistance. What we have instead is ineffectual drug testing, harsh compliance penalties and expanded income management. However, for sole parents there will be a new verification process that is especially demeaning.
There were no measures designed to specifically address gender inequality and the related entrenched financial vulnerability of women….
This Budget fails to address major challenges facing young women in Australia, and has no measures to improve financial, job or housing security for this cohort.
Youth unemployment is at 13.5% of the youth labour force, which is the highest rate in 40 years, and many young people are underemployed (18% of young people in the labour force) (Brotherhood of St Laurence, 2017, 3). Women aged 20-24 have a much higher rate of underemployment than men of the same age (Burgess, 2017). The job market is increasingly casualised and insecure, and as young people have little or no working experience they are more likely than other groups to work in nonpermanent jobs (Brotherhood of St Laurence, 2017, 4). There is nothing in this Budget to address the unemployment or underemployment that young people experience, and which have implications for the economic security of young women…..
The enhanced residency requirements for claimants of the Age Pension and the Disability Support Pension (DSP) from 1 July 2018 will require claimants to have 15 years of continuous Australian residence before being eligible to receive the Age Pension or DSP unless they have:
* 10 years’ continuous Australian residence, with five years of this residence being during their working life (16 years to Age Pension age); or
* 10 years’ continuous Australian residence, without having received an activity tested income support payment for a cumulative period of five years.
Approximately 40% of older Australians are born overseas and the majority of these are women (AIHW 2007, 4). Within CALD communities, as with the broader population, women are more likely to require age pension support because they have less superannuation (from lower paid jobs and from fewer years working). Women are therefore more vulnerable to economic insecurity and should not be punished in old age for being migrants or for not being able to meet the 5 cumulative years of no income support payments during the requisite 15 years’ continuous residency. CALD women are more likely to experience periods of income support due to their family care responsibilities and should not be punished for this.  [my yellow/red highlighting]