Mr ALBANESE (Grayndler—Leader of the House and Minister for Infrastructure and Transport) (09:29): I move:
That this bill be now read a second time.
The tax reforms are a major component of the government’s Stronger Shipping for a Stronger Economy legislative reforms to revitalise the Australian shipping industry.
The purpose of the government’s tax reforms is to encourage and support capital investment.
Changes made in 1996 by the previous government have meant a lack of investment in Australia’s fleet.
A consequence of this lack of investment, in addition to the slow decline in the number of registered vessels, is that our ships are getting older.
The average age of the Australian fleet now sits at almost 20 years which is around eight years older than the average of those in the world fleet.
Ironically, this imbalance exists despite Australia being a country that prides itself on the safety and environmental outcomes of our shipping.
In addition to being a brake on improving the productivity of our domestic shipping industry; newer vessels are safer, more energy efficient and better meet the needs of modern shipping.
Encouraging new investment is critical if we are to revitalise the industry.
The tax reforms I am introducing today provide a platform for this investment.
The tax reforms comprise two bills:
- This bill which provides the first step for companies seeking to access the various taxation concessions.
- The Tax Laws Amendment (Shipping Reform) Bill 2012, which will give effect to the five tax concessions.
This bill provides for the issue of certificates after the end of the financial year to companies who meet the requirements of the tax concession regime.
It also provides companies applying for these concessions for the first time the opportunity to obtain a ‘notice’ during the first year of entry.
This will give companies a degree of certainty that their proposed arrangements will meet the requirements of the Shipping Reform (Tax Incentives) Bill 2012.
Additional requirements will apply to companies accessing the income tax exemption.
Companies will need to demonstrate that they have a substantial proportion of commercial, technical or strategic operations as well as crew management based in Australia.
Companies will also be required to comply with a mandatory training requirement.
The details of this training requirement, which are currently being finalised by the Maritime Workforce Development Forum, will be contained in regulations.
These provisions are aimed at ensuring beneficiaries of this best-in-class tax concessions have a tangible connection to Australia and are committed to building the local maritime industry.
The bill also provides the power to collect and collate data in relation to these reforms.
Powers to review decisions are also provided for.
I commend the bill to the House.