17 March 2017
Speech - #2017008, 2017

Video message to the Tax Institute National Convention

Check against delivery

Hello to everyone gathered in Adelaide for the Tax Institute 2017 National Convention.

I apologise that I can't be there with you in person.

The Convention is one of the premiere events for tax professionals, and it looks like this year's event will present you with many challenging debates.

One thing tax practitioners agree on is that times are changing.

Those of you at the coalface play an essential role in putting those changes into practice.

Many of you, for example, will be briefing your clients on the superannuation tax reforms.

The predicted shift in demographics is the driver behind the Government's changes.

By 2055, the number of Australians aged 65 and over is projected to more than double.

  • One in every 1,000 people will be 100 years or older.
  • The number of people of working age for each person aged 65 years and over is decreasing.

We need a superannuation system that is fit for purpose now and into the future, so we are making changes to better target tax concessions.

Our reforms also go to sustainability, equity, integrity and flexibility of the overall system.

One of our key changes is the $1.6 million cap on individual transfers.

The cap, affecting less than 1 per cent of retirees, is a step towards sustainability.

There is also the Low Income Superannuation Tax Offset which benefits around 3.1 million Australians.

We have also introduced a series of measures to increase the flexibility of the system as we recognise that people have different work patterns across their lives.

This includes enabling those with interrupted work arrangements to make catch-up contributions.

The superannuation system now better reflects these different work patterns.

It levels the playing field for all Australians to contribute concessionally to their superannuation no matter what their employment arrangements.

The ATO has developed a concerted work program to ensure the reform package is implemented smoothly.

The ATO paid particular attention to preparing the draft Law Companion Guidelines to help industry prepare for the changes.

It is modifying its forms, schedules and related instructions in the lead up to 1 July.

In terms of education, the ATO is attending many industry events, like yours.

They are also hosting consultations and providing advice to software providers and financial advisors on the changes required.

The ATO also has set up a dedicated call centre to answer any questions you or your clients might have on the changes.

I encourage you to avail yourself of this service.

Multinational tax avoidance remains another focus area for the Government.

Again, our motivation is simple.

Companies doing business here in Australia require tax certainty and predictability.

At the same time, the Australian people require confidence in the tax system and they rightly demand that everyone pays the right amount of tax — and this includes multinational corporations.

Because if everyone doesn't pay what they ought to pay the burden shifts to fewer and fewer people paying higher and higher taxes.

Australia is at the forefront of the international fight against tax avoidance.

  • We are addressing base erosion and profit shifting as part of a global response.
  • We have already tightened our thin capitalisation rules.
  • We established a Tax Avoidance Taskforce with which is expected to raise $3.7 billion over four years to 2019-20.
  • We doubled penalties for multinationals caught avoiding tax through our multinational anti-avoidance law.
  • We have legislated the BEPS action item for the country-by-country reporting regime.
  • We are moving to protect whistle-blowers disclosing information about tax misconduct to the ATO.
  • And last month, we introduced a Bill into Parliament dealing with the Diverted Profits Tax.

This all adds up to a system where everyone pays the right amount of tax in Australia.

And it is in this environment that the Government can look to lower taxes, such as lowering the company tax rate to 25 per cent to encourage investment and to boost jobs.

I will finish up by saying, all the best for the rest of your convention.

Thank you to the Tax Institute for the opportunity.