van Velden BrookeBROOKE van VELDEN (Deputy Leader—ACT): Thank you Madam Speaker. It's a pleasure to rise on behalf of my ACT Party colleague Damien Smith who if you haven't read his speech at the first reading I really would recommend you go back and read. It is quite hilarious. He makes quite a few jokes that I don't think I could do service to.It is a pleasure to rise in opposition to the Taxation Principles Reporting Bill. We do it for a range of reasons but I wanted to firstly talk about what this bill is hoping to achieve. It is hoping to achieve a statutory framework requiring that the Commissioner of Inland Revenue reports annually about the country's tax settings against a set of core principles and these principles are all set out in Schedule 1 of the bill. It says here—quite lovely—it's to improve the public's understanding of the tax system" but that's a bit Orwellian really because that's not really what it's aiming to achieve. Schedule 1 sets out these principles and it says that the key principles here are "considered for designing or changing a tax system as measured by the approved taxation principles measurements" as follows: horizontal equity efficiency vertical equity revenue integrity compliance and administrative costs certainty and predictability and flexibility and adaptability. While the purpose of the bill is to produce a report about the tax system and extent it will then meet these principles the conclusion is always going to be in every report that no system can possibly meet all of these principles.There'll be people from all sides of this House that will have different opinions. There'll be people at times who are in Opposition and will think what comes out of these reports is bad because certain parts of these principles have not been met and there'll be people in the Government that will think it's good because other certain aspects have been met and vice versa when people flip-flop back and forth from Government to Opposition.It will be true of every single debate that we ever have about taxation in this country. There will be no new information that this bill will bring to a debate about taxation and whether or not it meets the principles of horizontal equity efficiency vertical equity revenue integrity compliance and administrative costs certainty and predictability and flexibility and adaptability. These are all principles that underpin a lot of taxation and the system but there's not actually going to be any new information. It'll just point out that there are different goals to meet some extent or all extents of the Taxation Principles Reporting Bill. So in effect what we'll end up with is simply a new layer of bureaucratic requirements on the Public Service to produce a report and when you think about that that's just another level of bureaucracy. This Government always wants to pass new laws that add more levels of bureaucracy more working groups more reports—more reports that get written and then never read even by the Government and never acted upon. But there is actually no need for legislation to create reports like this because the Minister could simply just request at any time that a report like this is written by the Commissioner of Inland Revenue. There's no need to set it out in legislation that the Commissioner of Inland Revenue must write this report. I mean David Parker will know having been Minister of Revenue that you could simply just request for a report to be made.But the biggest problem that I have with this is that it didn't actually go through the generic tax policy process when creating this bill. And when you go on to the IRD website it says: "How [is] tax policy … developed"? Well since 1995—only a little bit after I was born—it has said that the "tax policy has been developed using the Generic Tax Policy Process". So for our entire lives there has been a standard and the policy result of following the generic tax policy process means that "major tax initiatives are subject to public scrutiny at all stages of their development. As a result we have the opportunity to develop more practical options for reform by drawing on information provided by the private sector and the people who will be affected." The whole process of going through the generic tax policy process "gives us greater opportunity to explain to interested parties the rationale underlying [the] proposed reforms" thus improving the long-term stability of the tax system.This bill didn't go through the generic tax policy process. It didn't go through a formalised consultation period. There was only a small number of stakeholders that were informally consulted. Now that goes against how we're supposed to do changes to tax law. I don't think that is right. I also don't think it's right that the first reading of this bill went through urgency. Less than three months later we're sitting through the second reading under urgency on an issue to do with tax and it didn't actually go through proper scrutiny and proper consultation. That can't be good for the long-term sustainability of our tax system.The third reason that the ACT Party is opposing this bill is that we do not believe that the Inland Revenue Department is the right department to be reporting on the tax system because it is responsible for giving policy advice on and administering the tax system.Number four: we don't believe that this report is actually going to be requiring an explanation of the trade-offs and the different weightings of these tax principles. You see that there are quite a few tax principles that have to be met—the horizontal equity efficiency vertical equity etc. certainty and predictability. Now in designing any tax system there will be trade-offs and that will be open for discussion and debate about how we weigh or make those decisions. But this bill just means that the report will say that there are different principles and you can't satisfy all of them. It's not necessarily going to go into great detail about why various weightings have been given. The tradeoffs really should be explained and the principles given a weighting so it's clear why one principle has been met rather than the other. I think it's important that that is there for transparency for people who are reading these reports.But all in all we don't believe that this is a necessary piece of legislation. It's going to add a new level of bureaucracy by requiring a report that's not needed. If it really was needed the Minister could just ask for one rather than requiring it under law. It's not going to go into great enough detail to actually explain the different trade-offs and the weights given behind the different principles underneath it. And actually the IRD really shouldn't be the one issuing this type of report on the tax system given that they are at the same time administering it. So I am opposed to the bill on behalf of the ACT Party and my colleague Damien Smith."