Document ID: chunk:federal_register_of_legislation:C2004A04769:body:0:p15
Version: federal_register_of_legislation:C2004A04769
Segment Type: other
Provision Reference: 
Character Range: 37364–40189

benefits payable to former members etc. who hold offices of profit; and

     (c) to abolish the rule requiring the reduction of benefits payable to former members etc. who are receiving pensions arising out of service in offices of profit.

Effect of the holding of offices of profit—reduction of certain retiring allowances and annuities

  23. Section 21B of the Principal Act is amended:

  (a) by omitting from subsection (1) the definition of "pension";

(b) by inserting in subsection (1) the following definitions:

  " 'annual after-tax income', in relation to a hypothetical taxpayer and in relation to a year of income, means the hypothetical taxpayer's taxable income for the year of income, reduced by the income tax and the medicare levy imposed on that taxable income;

  'assessable income' has the same meaning as in the Income Tax Assessment Act 1936;

   'fortnightly grossed-up amount', in relation to particular remuneration, means the amount of assessable income that a hypothetical taxpayer would have to derive during each fortnight in the year of income concerned in order that the hypothetical taxpayer's annual after-tax income for the year of income would equal the annual rate of the remuneration;

   'hypothetical taxpayer' means a hypothetical taxpayer where the following assumptions are made:

    (a) that the taxpayer is an individual;

    (b) that the taxpayer is not a trustee;

      (c) that the taxpayer is a resident for the purposes of the Income Tax Assessment Act 1936;

      (d) that the taxpayer has no entitlement to a rebate or credit under that Act;

      (e) that no deductions are allowable to the taxpayer under that Act;

  'income tax' has the same meaning as in the Income Tax Assessment Act 1936;

   'medicare levy' has the same meaning as in Part VIIB of the Income Tax Assessment Act 1936;

  'taxable income' has the same meaning as in the Income Tax Assessment Act 1936;

  'year of income' has the same meaning as in the Income Tax Assessment Act 1936.";

  (c) by omitting subsections (2) and (3) and substituting the following subsections:

   "(2) Subject to subsection (4), if the following conditions are satisfied in relation to a person who is entitled to a relevant benefit:

    (a) the person is:

            (i) the holder of an office of profit under the Commonwealth; or

            (ii) the holder of an office of profit under a State;

    (b) the person receives remuneration in respect of the office;

        (c) the fortnightly rate of the remuneration exceeds 20% of the fortnightly rate of parliamentary allowance for the time being payable to a member;

    the fortnightly rate at which the relevant benefit would otherwise be payable to the person is to be reduced by 50 cents for each $1 of the excess.

    "(2A) For the purposes