QUESTIONS WITHOUT NOTICE: TAKE NOTE OF ANSWERS

Senator WALKER (South Australia) (15:20): I also congratulate Senator Duniam on his last contribution in this place. Our changes at its core are about making the system fairer for working Australians. At the core of our reforms to trusts is aligning the treatment of income from assets and income from work and helping fund our tax cuts to Australian workers.

It is true that the flexibility provided by trusts can also allow some Australians to plan their tax affairs in ways that aren't available to most workers and their families. To make Australia a fairer country, we need to make sure that tax obligations are distributed evenly throughout our society. Those in this chamber know that numerous reviews have raised concerns with tax arrangements for discretionary trusts over many years.

The first instance of this was a report in 1975. There was the Ralph review in 1999. There was the Henry review.

And there was the coalition's own tax discussion paper in 2015, which I know is a pretty inconvenient truth for those opposite. The settings are becoming more unsustainable with the number of discretionary trusts doubling over the past 20 years to over 800,000. There are legitimate reasons to use trusts, and anyone operating through discretionary trusts can continue to do so.

There is a substantial period for anyone using a trust to prepare before the 1 July 2028 start date, and we're providing expanded options to limit or eliminate restructuring costs as well. That includes expanded rollover relief from 2027 and options for trusts to elect to be exempt without requiring a restructure or paying a wage to beneficiaries employed in the trust.

The majority of trust income flows to the top earning 10 per cent of Australian families. About 90 per cent of the total private trust wealth is held by 10 per cent of households. The vast majority of Australians do not receive a discretionary trust income, and the vast majority of small businesses also do not operate using a trust.

Less than 10 per cent of small businesses will be affected in any given year. This change is about improving the fairness, integrity and sustainability of the tax system. We're focused on taking the pressure off Australians with permanent cost-of-living relief, including tax cuts for every Australian taxpayer that started on 1 July this year.

Those opposite are determined to present these fairer tax changes as an attack on business. We in the Labor Party see it for what it is: a smoke screen that they can hide behind while trying to protect their ability to minimise their tax and increase the divide. Like I've already touched on, our reforms are about better aligning the tax treatment of incomes from assets and income from work and to help fund tax cuts for Australian workers.

It's also worth noting that primary production income is exempt from the minimum tax on trusts, which we announced on budget night. It's also important that we note that this week the National Farmers' Federation said: We strongly welcome the Government's decision to legislate the exemption for primary production income, providing critical certainty for farming families.