Taxation
Background
The member raised concerns that the government's proposed trust tax could reduce funding for charities and not-for-profits, citing warnings from religious leaders.
Question
The member asked whether the Prime Minister would ensure that payments from discretionary trusts to registered charities, tax-exempt not-for-profits, and faith-based groups would be exempt from the 30 per cent trust tax. He sought confirmation that vital funding for vulnerable Australians would not be stripped by the legislation.
Includes 2 supplementary questions.
Answer from Penny Wong
The minister confirmed the government is consulting on implementation details, including arrangements for donations to charities and tax-exempt entities. She stated that the overarching purpose of the tax reforms is to make the system fairer by aligning the treatment of income from work with income from assets. In response to supplementary questions, she clarified that deductible gifts and donations reduce capital gains subject to the minimum tax, and that the minimum tax does not apply to charitable trusts. She noted that donations to deductible gift recipient organisations remain tax-deductible for discretionary trusts, and highlighted government measures to streamline the process for organisations to gain deductible gift recipient status.
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