Submission to The Treasury on Minimum Tax on Discretionary Trusts

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RE: Minimum tax on discretionary trusts

The St Vincent de Paul Society National Council of Australia (the Society) welcomes the opportunity to provide a submission on the implementation of the Government's proposed 30 per cent minimum tax on discretionary trusts.

The Society supports a fair, equitable and sustainable taxation system that raises sufficient revenue to fund essential public services and Australia's social safety net. As outlined in Towards a Fairer Australia, the Society believes Australia's tax system should ensure that those with the greatest capacity to contribute, including those with high incomes and accumulated wealth, pay their fair share.

Accordingly, the Society supports the Government's proposed reforms to the taxation of discretionary trusts as an important measure to improve the fairness and integrity of Australia's tax system. This submission addresses one implementation issue only.

The Society is concerned that, unless clarified, the proposed minimum tax could unintentionally reduce incentives for charitable giving. In considering this issue, the Society broadly supports the implementation approach proposed by the Australian Council of Social Service (ACOSS), which preserves existing incentives for donations to Deductible Gift Recipients (DGRs) while maintaining the integrity of the reforms.