Australia

Details

  • Service: Tax, Corporate Tax
  • Type: Regulatory update
  • Date: 11/07/2014

Tax Insights

KPMG's analysis of tax issues and developments.

Jenny Wong

Jenny Wong
Director, Tax

+61 2 9335 8661

jywong@kpmg.com.au

Politics of tax: What’s progressing through the Senate? 

by Jenny Wong, Australian Tax Centre

Every time I put pen to paper I’ve had to make a number of amendments on the status of various Commonwealth legislation in Parliament. It’s much easier to write restaurant reviews. From 1 July 2014, the Australian Senate and Australia’s fate lies in the hands of a diverse range of cross bench microparty members.

The composition of the 76 Senators is as follows:

Major Parties

Senate
Seats

Crossbench

Senate
Seats

Coalition

33

Palmer United Party

3

Australian Labor Party

25

Nick Xenophon

1

Greens

10

Democratic Labor Party

1

 

 

Liberal Democratic Party

1

 

 

Family First

1

 

 

Australian Motor Enthusiast Party

1


Why are the crossbenchers important? The Coalition Government requires a majority of 39 votes in the Senate to pass legislation. With already 33 votes, the Coalition will not have to rely on Labor or the Greens to pass legislation as long as they can gain support from 6 out of the 8 crossbenchers.

 

To assess whether the Coalition’s legislation to abolish the carbon tax, the mining tax, paid parental scheme, and the GP co-payment scheme will pass the Senate, understanding the crossbenchers’ stance on these policies will be important. We don’t need to worry about the Temporary Budget Repair Levy as that’s now law.

Here’s a snapshot of the micro parties’ stances at the time of publishing:

 

Abolish carbon tax

Abolish MRRT

Paid parental scheme

GP co-payment

Palmer United Party

x

x

x

Nick Xenophon

x

x

Democratic Labor Party

x

x

Liberal Democratic Party

x

x

Family First

x

x

Australian Motor Enthusiast Party

x

?

?

?

 

As it stands, the Coalition has not garnered crossbench support for the repeal of the carbon tax. It is likely to obtain support for the repeal of the mining tax legislation. Support from the micro parties for the Coalition’s paid parental scheme, and GP co-payment scheme are looking less promising, raising the prospect that the Coalition may need to negotiate with the parties to progress its policies.

 

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