Bills

Stamp Duties (Foreign Ownership Surcharge) Amendment Bill

Introduction and First Reading

The Hon. A. KOUTSANTONIS (West Torrens—Treasurer, Minister for Finance, Minister for State Development, Minister for Mineral Resources and Energy) (15:42): Obtained leave and introduced a bill for an act to amend the Stamp Duties Act 1923. Read a first time.

Second Reading

The Hon. A. KOUTSANTONIS (West Torrens—Treasurer, Minister for Finance, Minister for State Development, Minister for Mineral Resources and Energy) (15:42): I move:

That this bill be now read a second time.

The bill amends the Stamp Duties Act 1923 to introduce a foreign ownership surcharge on the conveyance or transfer of an interest in residential property to a foreign person, corporation or trust, executed on or after 1 January 2018, including landholder acquisitions. The surcharge will be set at a rate of 7 per cent of the dutiable value conveyed, but it will only be payable with respect to the extent of the interest in the residential property. The surcharge will be in addition to the normal stamp duty that is payable.

The definition of a foreign person includes natural persons, corporations and trusts. A foreign natural person is a person who is not an Australian citizen or a permanent resident. Generally, a company is a foreign company where it is incorporated outside Australia or where 50 per cent or more of its shareholding is held by other foreign persons or companies in aggregate. A trust will be a foreign trust where the trustee of the trust is a foreign individual or company, or where the trust itself is established for the benefit of, or is controlled by, foreign persons and companies.

This bill is similar but not the same as the measure that was in the Budget Measures Bill that was blocked in the other place. This measure has a new rate of 7 per cent, rather than 4 per cent, in an attempt to make up for some of the shortfall in revenue lost from the defeat of the Budget Measures Bill. I seek leave to insert the explanation of clauses in Hansard without my reading it.

Leave granted.

Explanation of Clauses

Part 1—Preliminary

1—Short title

2—Amendment provisions

These clauses are formal.

Part 2—Amendment of Stamp Duties Act 1923

3—Amendment of section 2—Interpretation

This clause inserts definitions of the terms foreign person and foreign trust.

A natural person is a foreign person if the person is not—

an Australian citizen within the meaning of the Australian Citizenship Act 2007 of the Commonwealth; or

the holder of a permanent visa within the meaning of section 30(1) of the Migration Act 1958 of the Commonwealth; or

a New Zealand citizen who is the holder of a special category visa within the meaning of section 32(1) of the Migration Act 1958 of the Commonwealth.

A corporation is a foreign person if it is incorporated in a jurisdiction that is not an Australian jurisdiction or a person who is a foreign person or a trustee for a foreign trust (or a number of such persons in combination)—

holds or hold 50% or more of the corporation's shares; or

is or are entitled to cast, or control the casting of, 50% or more of the maximum number of votes at a general meeting of the corporation.

A trust is a foreign trust if the beneficial interests of the trust are fixed and a beneficial interest of 50% or more of the capital of the trust property is held by 1 or more foreign persons. A discretionary trust is a foreign trust if a trustee under the trust, a person who has power to appoint under the trust, an identified object under the trust or a person who takes capital of the trust in default is a foreign person.

The clause also inserts related definitions of wholly foreign owned corporation and wholly foreign owned trust.

4—Insertion of Part 3 Division 9

This clause inserts a new Division into Part 3 of the Act.

Division 9—Foreign ownership surcharge

72—Surcharge for foreign purchasers of residential land

Proposed section 72 makes provision for a foreign ownership surcharge payable in respect of a dutiable instrument executed on or after 1 January 2018 if the instrument effects, acknowledges, evidences or records a transaction whereby an interest in residential land is acquired by a foreign person or a person who takes the interest as trustee for a foreign trust. The surcharge, which is equal to 7% of the value of the interest acquired by the person, is to be taken to be duty payable on the instrument and is payable in addition to duty otherwise payable under the Act.

The proposed section includes a requirement for the Commissioner to refund a foreign ownership surcharge to a person where, within 12 months of the acquisition of the relevant interest, the person ceases to be a foreign person or the trust for which the person is trustee ceases to be a foreign trust. The refund is payable only if the interest is retained by the person when the person ceases to be a foreign person or the trust ceases to be a foreign trust.

There is also a requirement for a person who acquires an interest in residential land effected, acknowledged, evidenced or recorded by an instrument to which the section applies to pay the surcharge if the person becomes a foreign person, or the trust for which the person is trustee becomes a foreign trust, less than three years after the acquisition. A person who is liable to pay duty in these circumstances must notify the Commissioner that the person has become a foreign person, or that the trust has become a foreign trust, within 28 days.

The criteria for determining whether land is residential land are the same criteria that apply under section 71DC. Land will be taken to be residential land for the purposes of the section if—

the Commissioner, after taking into account information provided by the Valuer-General, determines that it is being predominantly used for residential purposes; or

the Commissioner, after taking into account information provided by the Valuer-General, determines that although the land is not being used for any particular purpose at the relevant time the land should be taken to be used for residential purposes due to improvements that are residential in character having been made to the land; or

the Commissioner, after taking into account information provided by the Valuer-General, determines that the land is vacant, or vacant with only minor improvements, that the land is within a zone established under the planning and development law of this State that envisages the use, or potential use, of the land as residential, and that the land should be taken to be used for residential purposes due to that zoning (subject to the qualification that if the zoning of the land indicates that the land could, in a manner consistent with the planning and development law, be used for some other purpose (other than for primary production) then the vacant land will not be taken to be used for residential purposes).

5—Insertion of section 102AB

This clause inserts a new section into Part 4 of the Act (Land holding entities).

102AB—Surcharge where foreign person or group acquires interest in residential land

Proposed section 102AB provides for the payment of a foreign ownership surcharge in relation to transactions entered into on or after 1 January 2018 that are dutiable under Part 4. The surcharge is payable by a foreign entity if the entity, or a group of which the entity is a member, notionally acquires an interest in residential land. A foreign entity is a foreign person or a foreign trust. The amount of the surcharge is 7% of the value of the interest notionally acquired by the entity, or 7% of the entity's interest in the interest notionally acquired by the group, in the residential land. Section 102AB includes requirements for the payment of a refund where an entity that has paid the surcharge ceases to be a foreign entity within 12 months of the relevant notional acquisition. The refund is payable only if the relevant interest is retained when the entity ceases to be a foreign entity. As with section 72, there is also a requirement for an entity to pay the surcharge if it becomes a foreign entity within three years of the notional acquisition of an interest in residential land by the entity, or by a group of which the entity is a member, as a result of a transaction to which the section applies.

The criteria for determining whether land is residential land are the same as the criteria that apply under section 71DC and proposed section 72.

Mr MARSHALL (Dunstan—Leader of the Opposition) (15:44): I do not think there has ever been a bigger contrast between the Labor Party and the Liberal Party here in South Australia. Again, at every single opportunity, we see the Labor Party wanting to increase the tax burden on the people of South Australia, whereas people on this side of the house—

Members interjecting:

The DEPUTY SPEAKER: Sit down. I remind members of the standing orders. The Treasurer was heard in silence. The house needs to offer that respect to every member on their feet when making a contribution. Therefore, I will have to get the bad book out as the leader continues his speech, and some of you already have ticks and crosses.

Mr MARSHALL: As I was saying, I think it is great for democracy that the people of South Australia at the next election will have a choice—a choice between a high-taxing, dysfunctional Labor administration and a lower taxing alternative. The Liberal Party of South Australia wants to lower taxes, deregulate here in South Australia and drive growth in our economy, growth in our exports and growth in investment here in South Australia. What we see at every single opportunity is those opposite always trying to stick their hand in the pockets of the taxpayers of South Australia.

We have had to rescue the taxpayers from opposition on multiple occasions. As you would recall, Madam Deputy Speaker, at the last election the government took a proposal to the people of South Australia to put a car park tax on people coming into car parks. This was completely rejected by the people of South Australia: I think the Labor primary vote was 36 per cent at that election. So we came to the new parliament after the budget was handed out in 2014 and we worked with the crossbenches in that other place to make sure that that would not proceed.

In that instance, the government did the right thing. They removed the offending part of that budget measures bill, and they allowed the rest of that budget measures bill to go through. We also note that the government, addicted to increasing taxes—it is in their DNA—before the last election said that they would never put a land tax on the family home, even though it had been canvassed by some of the members opposite.

The then Treasurer, the now member for Playford, the potential aspirant for the seat of Florey until recently, said that if they were going to put that tax onto the family home then they would discuss it with the people of South Australia, come clean with the people of South Australia and take it to an election. Did they do that? Absolutely not. In the first budget handed down immediately after the 2014 election, they removed the remission on the emergency services levy and thereby put that massive ongoing tax onto the family home.

The Liberal Party's position on this tax is also very clear. We are going to restore the $360 million that this government has wrenched from the people of South Australia because we in the Liberal Party believe that people, given the money in their pocket, will make better choices to improve their lives. The Labor Party of course prefer to take that money from households and from small business to put in the Treasury coffers because they think they know what is best in terms of government expenditure. Of course, we know that that is not the case.

Fast-forward to the budget that was handed down in June this year. There were some very unacceptable parts of that budget, in particular, the imposition of this major bank levy, the so-called state bank tax. We know that this tax was never going to create one single job for South Australia. We know that it was actually going to drive investment dollars out of South Australia. This government has presided over the economy now for almost 16 years: it is a very fragile economy in South Australia. The very last thing we need in South Australia is another body blow to investor confidence in South Australia by removing that certainty.

When we asked questions about this in the house, the Treasurer was pretty clear on this issue; he was being pretty frank. He said, 'We're going to tax anybody who is not paying enough tax in this state.' We have asked him repeatedly to outline who these other people in South Australia are that are not paying enough tax. Let's provide some early warning to these people because certainty is a critical aspect in trying to attract investment in South Australia. All this government has done is increase uncertainty and drive investor dollars out of South Australia. They have done it with their failed management of the Gillman precinct and they have done it with their failed management of the new courts precinct or the new prisons project here in South Australia. There have been so many examples.

Most recently, of course, we have the gross mismanagement of the old Royal Adelaide Hospital site in South Australia. The government first announced this project back in 2007, yet a decade later we still have no clear picture of what the government is going to do. What we do know is that they gave an exclusivity arrangement to one company about a year ago. Then, after that company spent plenty of money on putting their bid into place, what did the government do? Again, they created that level of uncertainty, and this is what is driving down investor confidence in South Australia.

We heard the Premier today in the parliament suggesting that I had changed my position on this Budget Measures Bill, which was previously before the parliament. In fact, I was always opposed to any increases in taxes, but the Premier is quite right: it is a precedent in this place, it is a practice in this place not to oppose budget measures bills. Having said that, the Hon. Rob Lucas in the other place has catalogued all the examples of where the Labor Party has amended budget measures bills, both in government and in opposition over the last 35 years that he has been in this place. I refer the members opposite to his excellent contribution in that chamber—

The DEPUTY SPEAKER: That's a long time.

Mr MARSHALL: Thirty-five, yes; I see you acknowledging that.

The DEPUTY SPEAKER: He was 12 when he arrived.

Mr MARSHALL: That's right; he is looking very good. I think the parliament has been good for his longevity. The reality is that it was an extraordinary move for the Liberal Party to seek to amend this Budget Measures Bill, but we did not do it without due consideration. We did it because we believed that it was a decision that was in the best interests of all South Australians. Sticking this major bank levy in place here in South Australia, differentiated from any other state in Australia, was not the right thing to do if we were serious about growing our economy. We on this side of the house are serious about getting this state moving after essentially treading water with 16 years of failed Labor administration.

So we said to the government, 'Remove the provisions for the state bank tax and allow your full Budget Measures Bill to go through.' What we had thereafter was an incredible series of threats made by the Treasurer and by this government. First they said, 'There's just no way we can provide this payroll tax concession without this money going through.' Of course, this turned out to be inaccurate. The Under Treasurer confirmed to a parliamentary inquiry that the payroll tax concession could be provided as an administered item of the government, as it had been previously. However, the Treasurer failed to point that out to the people of South Australia. He said that the Liberal Party wants to block the tax. Well, this was just completely and utterly inaccurate but it is what we have become used to with this government.

Then they said that we will not be able to have the stamp duty concessions. Again, this was not accurate. Now we have the Treasurer coming into this place today saying, 'Well, we are going to provide the payroll tax concessions and we are going to provide the stamp duty concessions, and we are going to do it administratively,' just as the Liberal Party has been saying for several months. But more than that, the Treasurer and the Premier have gone to some lengths to suggest that they are so wedded to this idea of making these payroll tax concessions permanent that it must be legislated. It was their ardent belief that it must be legislated.

I say to the Treasurer today that if he is so wedded to this concept of it being made permanent on the statute, the Liberal Party is not standing in your way. From day one, the Liberal Party said that there was only one offensive component to the Budget Measures Bill. Now the Treasurer and the Premier have moved away from their position that they want to enshrine this in legislation because somehow it could be tinkered with otherwise. Maybe the government has changed its position long term with regard to these concessions because they have certainly been out threatening businesses.

Only last week, the Treasurer was on the record saying that he was going to write to every single small business in South Australia and say that payroll taxes would have to go up if he could not get his bill through. Well, the bill has not gone through. He has not gone through with his threat and he has not persisted with his bullying techniques, and what we have before us today is, of course, this revised attempt for this government to save face. It has been a humiliating time for this Treasurer and for this Premier in South Australia. But the good news is that the people of South Australia have again been saved from another new tax being imposed upon them from the Labor Party.

Another thing I would say at this point is that we were in a very clear position regarding our party's position many months ago. The crossbenchers in the other place were also very certain of their position many months ago. Unfortunately, this whole issue has been dragged out either because of incompetence—that is, the Treasurer's numeracy skills: he could not count the numbers in the other chamber; there are 22 and you need 11 to get your bill passed—or for some reason he just wanted to threaten the people of South Australia over such a long period of time. Either way, he has not been successful. He has egg all over his face and today we find ourselves back in this chamber now looking at a new bill, the Stamp Duties (Foreign Ownership Surcharge) Amendment Bill.

Despite the fact that we have only been presented with the bill in the last few minutes, we can count the numbers on this side of the house and we know that we would not be able to stop this foreign ownership surcharge even if we wanted to. But, true to our word, over the last six months we have made it very clear that we would not be holding up any part of the Budget Measures Bill, apart from, of course, the state bank levy. We will allow this to pass. We do not like any increases in taxes.

I note that when this was first floated as a potential source of additional revenue in South Australia, the Treasurer's comments were very different from what they have been this year. In June 2016, when the budget was being framed and other jurisdictions around the country were putting on these foreign ownership surcharges, the Treasurer in South Australia ruled it out. He said, 'We won't be doing this in South Australia. This would be xenophobic.' He said that there was no way South Australia would participate. He said, 'We want to drive investment from foreign owners here in South Australia,' yet, less than 12 months later, he has done a massive backflip because he is addicted to taxes. Not only is he addicted to taxes and wanting to put this in place but he is now, within days, wanting to increase it even further.

We said that if the budget was introduced we would not stand in its way. We guaranteed the supply of the government. We did not like the budget measure which related to the state bank tax. The government had their opportunity to remove it but they did not. We will scrutinise the bill further in the other place. We will announce our tax policy in plenty of time before the next election. We look forward to the government handing down its Mid-Year Budget Review. We would be grateful if the Treasurer gave us some indication as to when that could potentially be. After that, we will be in a position to assess the financial legacy that the government elected in March next year will inherit. We will announce the reforms that we will make to finally turn this state around, make it strong again and get it back on track.

The Hon. J.W. WEATHERILL (Cheltenham—Premier, Minister for the Arts) (15:59): Today, the ABS reported the trend unemployment rate at 5.6 per cent, the lowest in five years, representing 26 continuous months of employment growth. Of course, that has occurred at a time when we have consumed the loss of one of the largest industries within one of the most significant sectors in our economy: the car industry within the manufacturing industry. As we crafted the plan back in August 2014 and put it in place, obviously we had to deal with the challenges of that transition.

Midway through that period, when our unemployment rate got as high as almost 8 per cent, we had those opposite predicting double-digit unemployment and suggesting that our economic plan was not working. We recommitted to that plan, we invested in it, and what we see today is the effect of that plan on the South Australian economy—thousands and thousands of South Australians in work, having a purpose and providing for themselves and their families because of the policies of this government: investing in the industries of the future, securing the defence contract, securing the IT jobs, the high-tech manufacturing jobs, the food and tourism and wine jobs, the education sector jobs, the jobs that are creating a sense of purpose for South Australians.

Incredibly excitingly, it is taking us into a leadership role in renewable energy and the low-carbon economy, which is attracting attention from around the world. When Elon Musk said that he wanted to partner with South Australia because it was taking a risk and he wanted to be a partner in its clean energy future, he was sending a message around the world, to risk-takers around the world, that, if you are an entrepreneur with an idea, come to this state because it is a state that will support you and allow your business to grow.

Members interjecting:

The DEPUTY SPEAKER: Order on my left!

The Hon. J.W. WEATHERILL: Many of those businesses are beating a path to our door, and that is the reason why we are seeing this surge—

Members interjecting:

The DEPUTY SPEAKER: Order on my left!

The Hon. J.W. WEATHERILL: —in growth in employment in this state. If we had listened to those opposite, if we had accepted their economic recipe for this state, we certainly would be facing double-digit unemployment. That is the spectre that haunts this state if they were to make the decision to allow those opposite to govern after March 2018. I notice that the Leader of the Opposition has airbrushed history with his blithe suggestion, 'Oh, yes, this was always our position, to oppose the bank tax.' It is absurd that he advances that. He said that he would support the bank levy, then the banks lobbied him, then he said that he would oppose the bank levy. That is the order of events and it is manifestly clear on the public record.

Mr Duluk interjecting:

The DEPUTY SPEAKER: The member for Davenport is called to order.

The Hon. J.W. WEATHERILL: If the Leader of the Opposition would like his words thrown back in his face, I am more than happy to do it. Marshall: 'The budget will be going through in the next month or so, and we have a tradition in the South Australian parliament that the government of the day—

Mr Marshall interjecting:

The Hon. J.W. WEATHERILL: Listen further.

The DEPUTY SPEAKER: Order on my left!

The Hon. J.W. WEATHERILL: —passes its budget. I think this sets up a real showdown at the next election where we think we are going to get a higher taxing Labor government or a lower taxing Liberal government. Let the people of South Australia make their decision at the ballot box in March next year.' Marshall: 'Oh, look, this is the Premier's budget,' in answer to a question about the bank tax.

Mr PISONI: Point of order: the Speaker has pointed out time and time again that even reading material into Hansard requires the members to be addressed by their title or their electorate.

The DEPUTY SPEAKER: I am sure we could rectify that part of it.

The Hon. J.W. WEATHERILL: The Leader of the Opposition: 'Oh, look, this is the Premier's budget. It will pass the parliament, but I think it sets up a very interesting showdown at the next election.' If there is any doubt that he was talking precisely about the bank tax passing, the Leader of the Opposition says: 'I think, with the car park tax, that was something that we took to the last election. We believe we had a mandate, Labor only getting 36 per cent of the vote. But the tradition in the South Australian parliament is that the government of the day passes its Supply Bill and ultimately its budget.'

Mr Marshall interjecting:

The DEPUTY SPEAKER: Order!

The Hon. J.W. WEATHERILL: Further, the Leader of the Opposition:

There's 175-year history where the Government's Budget of the day gets passed. There was an extraordinary situation that was set up in…2014…because that was an election which I think gave a clear mandate—

Mr Marshall interjecting:

The DEPUTY SPEAKER: Order on my left!

The Hon. J.W. WEATHERILL: He continues:

—to our position to scrap the car park tax. That isn't the situation in this instance.

So the Leader of the Opposition was drawing a distinction about why he was permitted to oppose the car park tax and said, in contradistinction, that the bank tax sat in a different position. The Leader of the Opposition, instead of coming here and honestly owning the fact that he changed his mind—and in a moment I will go to why that might be the case, why he may not be coming in here and honestly owning up and taking responsibility for these matters—he comes in here and pretends it was always his position that he was going to block the bank tax, and somehow draws a distinction between the Supply Bill and the Budget Measures Bill. That does not reflect what he said. It does not reflect the record in black and white.

What he has done is come in here, sneak in here, and suggest that this was somehow always his position, rather than have the courage of owning up to the fact that he changed his mind. Own it, own the fact that you shifted your position. There is no dishonour in shifting your position—except, of course, if you have a consciousness of guilt, when in your heart of hearts you realise that you are not prepared to own up and accept responsibility for your decision, when you realise in your own mind that there might have been something else operating on your decision. What would that be?

Mr Marshall: You tell us then.

The Hon. J.W. WEATHERILL: No, that is for you to tell us. You are the one who is coming in here and not honestly and openly owning up and taking responsibility for your decisions. This is for you to answer this question. It is for the Leader of the Opposition to answer the question of why he is dissembling about coming into this place and not telling us the truth about why he shifted his position.

One can only speculate, but it has something to do with a meeting, or series of meetings, that occurred between the Liberal Party, the Leader of the Opposition, and the banks. That is one thing we know. What we have is a clear position, on the public record, of support, then we have the lobbying by the banking sector, and then we have a shift in a position. Then we have this mealy-mouthed dissembling about whether, in fact, he did shift the position. Just own it, just own the fact that the position has been shifted.

This is consistent. You say that this is a contest at the next election—my word it is. It is about character. It is about owning up and taking responsibility for your own decisions. It is about leadership and about standing up for South Australia. What will be the next call? Will it be from Sally Zou when she decides to collect on her donation, or will it be from some other large, powerful interest that arrives in town and muscles the Leader of the Opposition to kowtow—

Members interjecting:

The DEPUTY SPEAKER: Order! I would like to draw members' attention to standing orders where we are supposed to give people on their feet the right to be heard in silence. I draw the Premier back to the nub of the debate.

The Hon. J.W. WEATHERILL: This goes fundamentally to the issue. This is an issue—

The DEPUTY SPEAKER: We are listening very carefully.

The Hon. J.W. WEATHERILL: This is an issue of character—

An honourable member interjecting:

The DEPUTY SPEAKER: Order on my left!

The Hon. J.W. WEATHERILL: This goes to the question of character, this goes to the question at stake, and the reason—

Mr PISONI: Point of order.

The DEPUTY SPEAKER: Point of order on my left. Please be seated, Premier. The member for Unley has a point of order.

Mr PISONI: Standing order 128: irrelevance and repetition. Not only is the Premier being irrelevant to the bill, the bill is about a new tax, or an increase in tax, for foreign investors here in South Australia, and the Premier himself—

The DEPUTY SPEAKER: Having drawn my attention to 128, we are going to listen very carefully to the Premier and remind him not to be repetitious.

The Hon. J.W. WEATHERILL: I will draw my remarks—

Mr Pisoni interjecting:

The DEPUTY SPEAKER: He has already said that once, so if he says it again that is repetition, isn't it?

The Hon. J.W. WEATHERILL: Deputy Speaker, what we are talking about here, the reason we are debating this bill, is that the Leader of the Opposition shifted his position. He shifted his position after lobbying by a powerful interest.

I make this point: there are many powerful interests that come to bear on the political process. There is lobbying that comes to bear on the political process. The real question is whether you are prepared to stand up for South Australia or whether you bow down to the pressures that are brought to bear, whether it is Malcolm Turnbull on the telephone saying, 'Drop the 50 per cent renewable energy target,' and then miraculously every Liberal opposition leader in the nation whistles up the same policy on the same day. That is not some independent assessment of public policy by the Liberal Party of South Australia, that is being whistled up by a large powerful interest. Who else is going to arrive in town? Who else is going to arrive in town and put pressure on the Leader of the Opposition?

This debate is fundamentally about whether you are prepared to stand up for South Australia or whether you are prepared to bow down to the pressure applied by five corporate interests. Banks, making $30 billion of profits and our asking to pay one-third of 1 per cent of those profits by way of taxation, that is what happened here, and that is why the Leader of the Opposition is so shy about coming in here and accepting responsibility for his actions.

Mr Marshall: Goodness gracious! You're a sore loser.

The DEPUTY SPEAKER: Order on my left!

Mr PISONI (Unley) (16:10): It is amazing, isn't it, what we have witnessed here from the Treasurer and the Premier today? The politics of envy. This whole South Australian bank tax was all about the politics of envy, and guess what? They got the politics wrong because the South Australian public is much smarter than that. They know that this is a tax on them and a tax on business and a tax on the private sector in South Australia, and they know that it is the private sector that generates jobs in South Australia.

This government actually believes that it is its responsibility to run the economy. Look at the job they are doing in South Australia. It is an extraordinary situation. If we talk about self-interest, you cannot get anything more self-interested than being a member of the Australian Labor Party, the South Australian Labor Party in particular. Look at what has evolved in the shoppies union—

The DEPUTY SPEAKER: Order!

Mr PISONI: —over the last 30 or 40 years. This is about character and the conflicts of interest that face these people opposite every day in this chamber when they put their union before the people of South Australia. It happens time and time again. Look at what happens at Coles, Woolworths, Foodland, Big W, KFC, Subway and McDonald's. Kids' penalty rates on Sundays are trashed in exchange for the union having access to 15 or 16-year-olds on their first day at work. Read the enterprise bargaining agreement. It is all there. They are forced to sit in front of a union member, a union delegate, who will put this single stick in front of them and say, 'Look at what will happen to you if you do not join our union.'

The Hon. A. KOUTSANTONIS: Point of order, Deputy Speaker.

The DEPUTY SPEAKER: Point of order. Order! We have a point of order. Member for Unley, we have a point of order.

The Hon. A. KOUTSANTONIS: I just point out that the member made a point of order about irrelevance earlier, and he is now talking about industrial relations.

Members interjecting:

The DEPUTY SPEAKER: Order on my left!

Members interjecting:

The DEPUTY SPEAKER: Order! There is a member on his feet.

The Hon. A. KOUTSANTONIS: So—

Mr Wingard interjecting:

The DEPUTY SPEAKER: Member for Mitchell, you are on two warnings and you will leave us if you continue. That would be a tragedy.

The Hon. A. KOUTSANTONIS: Had the member not moved his point of order, I would not have cared but given he is a hypocrite, he should have the same point of order apply to him.

Members interjecting:

The DEPUTY SPEAKER: Order! Sit down. We have to ask you to withdraw the word 'hypocrite'.

The Hon. A. KOUTSANTONIS: I withdraw the term 'hypocrite', ma'am, but my point of order stands about irrelevance.

Members interjecting:

The DEPUTY SPEAKER: Order on my left!

Mr Wingard interjecting:

The DEPUTY SPEAKER: Member for Mitchell, you move your lips once more and I will have to do something about it.

Mr Wingard interjecting:

The DEPUTY SPEAKER: Then you need to leave the room. We are going to have to remind members that the Chair has been very lenient in letting people say a great deal in this debate. It is usual in the house for members to be given a wideranging opportunity in this sort of debate. So if I have to draw one of you back, you will all have to come back. I think it is important that we just try to keep to the topic which is the bill before us. I know you are going to try to do that, member for Unley.

Mr PISONI: Thank you, Deputy Speaker. Of course, character is the topic that the Premier brought into this debate, and I will respond to the issue of character that he introduced into this debate. Of course, what happens on that induction night is that, after a half an hour of propaganda that has continued to be thrown at these—

The Hon. C.J. PICTON: Point of order: section 128 again. You have given him some leniency and he has jumped straight back into talking about industrial relations, which has nothing to do with the bill before us.

The DEPUTY SPEAKER: It was beginning to sound like a friendly society's secret meeting at that point, but I know he will draw himself back to the nub of the discussion in the time that is remaining and try to give us something reasonable towards the bill.

Mr PISONI: This is about the politics of envy. This government pulled that trigger and they failed. We need to look at the history of the South Australian branch of the Australian Labor Party and its foundations within the shoppies union in South Australia. Everything is political. Even a 15-year-old trolley collector's first day at Coles or Woolworths is a political event because of the shoppies union in South Australia, just as the bank tax was a political tax, a political event here in South Australia, so that this Treasurer could push the button to set up an election based on the politics of envy. Guess what? You lost, Treasurer. You lost.

The Hon. A. Koutsantonis: Did I?

Mr PISONI: Yes, you did. You were pulled up as the phoney that you are.

The DEPUTY SPEAKER: It is unparliamentary to interject and it is unparliamentary to respond. I have a point of order on my right.

The Hon. A. KOUTSANTONIS: I ask the member to withdraw the remark that I am a phoney.

The DEPUTY SPEAKER: You are a phoney? He could not have possibly said that. He did say that? I am going to give you the opportunity to withdraw it.

Mr PISONI: I am not sure that it is unparliamentary.

The DEPUTY SPEAKER: I am sure he is the real Treasurer, if that is what you are talking about.

Mr PISONI: Is the word 'phoney' unparliamentary?

The DEPUTY SPEAKER: He has asked you to withdraw it—that is the point.

Mr PISONI: I am happy to withdraw. I know that he is very bruised this week after having to—

The DEPUTY SPEAKER: Order!

Mr PISONI: —suck eggs.

The DEPUTY SPEAKER: Sit down! Apparently, 'phoney' is there with 'banshee'. In other words, it is okay, so there it is.

An honourable member interjecting:

The DEPUTY SPEAKER: No, there is no point to all of that. Let's get back to the bill. I am sure the people of South Australia are more interested in the bill.

Mr PISONI: I am just surmising as to how—

The DEPUTY SPEAKER: I have a point of order; sit down. Member for Newland.

The Hon. T.R. KENYON: The Treasurer asked the member for Unley to withdraw and apologise. You have ruled that 'phoney' is in fact unparliamentary.

The DEPUTY SPEAKER: No, it is not. It is like 'banshee'.

The Hon. T.R. KENYON: I thought 'banshee' was. Mick said 'banshee' was as well.

The DEPUTY SPEAKER: You want me to rule on the word 'phoney'? Hang on, this could be groundbreaking. The computer says no. Let's get back to the bill.

Mr PISONI: Thank you, Deputy Speaker. This is the culture that has evolved with the South Australian Labor Party. They like to tax. They will achieve anything they can by taxing. They even tax their union members in the shoppies union an extra 10 per cent that they then pay Coles and Woolworths to deduct their union fees from their salaries. So the lowest paid—

The DEPUTY SPEAKER: Member for Unley, sit down.

Mr PISONI: —workers—

The DEPUTY SPEAKER: Sit down! We are prepared to give you as much leniency as we have to this point, but it is going to now be about the bill. The debate in the chamber is to be relevant to the bill. The Chair has been lenient on both sides for two speakers, so it stops now. Member for Unley.

Mr PISONI: I am done.

The DEPUTY SPEAKER: You have finished? Great. Treasurer, if you speak, you close the debate.

The Hon. A. KOUTSANTONIS (West Torrens—Treasurer, Minister for Finance, Minister for State Development, Minister for Mineral Resources and Energy) (16:19): Thank you very much, Madam Deputy Speaker—

The DEPUTY SPEAKER: You do not have to say anything except that you move it a second time, really.

The Hon. A. KOUTSANTONIS: Thank you for the advice. Thank you to the house for the quick passage of the first stage. It is an important measure to try to undo some of the damage done by the blockage of the budget. My real gripe about the blockage of the budget bill is not so much that the measure has fallen down, it is that a principle that has been held in longstanding convention in this place that has served this state well has been trashed. That is why it saddens me that the budget measure has not passed. Despite what the shadow minister says, and what the Leader of the Opposition says, these conventions have served this parliament well. It served this state well. It served Tom Playford well, it served Don Dunstan well—

Mr Duluk: Sir Thomas Playford; get it right.

The Hon. A. KOUTSANTONIS: My apologies: Sir Thomas Playford—

The DEPUTY SPEAKER: The member for Davenport is called to order for the first time.

The Hon. A. KOUTSANTONIS: I say to the younger members who are sitting on the backbench, looking from afar at the front benches, that they are being led down a path that they do not recognise by their leader. It would not have been a path that they recognised when they joined the Liberal Party. It would not have been a path of this sort of radical, extreme type of politicking that the member for Unley and the member for Dunstan are advocating—

Members interjecting:

The DEPUTY SPEAKER: Order!

The Hon. A. KOUTSANTONIS: Money bills have been, by and large, only amended or abandoned by governments. Governments make the decision about whether or not these bills should pass. The examples that the shadow treasurer—and former treasurer—the Hon. Rob Lucas introduced into debate for precedence were on the basis of the Legislative Council using its constitutional power to make suggestions to the House of Assembly, which is its right, but the House of Assembly can reject those suggestions.

The Legislative Council then has two options: it can enter into a deadlock conference to try to resolve the dispute between the houses, or the bill is set aside. The opposition, with other members of the crossbench in the Legislative Council, set the bill aside. That is the first time a money bill has been set aside in this state's history. It is the first time a budget measures bill has been set aside in the state's history. That is unprecedented. It has never occurred before, but I am pretty sure it will not be the last time now, and that is the sad part of this debate.

While members are crowing about this measure being blocked, it is not a victory for parliamentary democracy. It is not a victory for the Liberal Party. It is a victory for an external force that has unbelievable reach and influence in this parliament. There has been much talk of a federal royal commission into the banking sector, and I am sure that the royal commission will look into the Bankers' Association's influence into political decision-making around the country and indeed in South Australia. It will be interesting to see what is found out during that royal commission about the opposition's public statements leading up to their backflip and then the sudden backflip. The Premier is right: it is about character. The trade union royal commission was also conducted—

Mr Pisoni: Great stuff about Bill Shorten in there.

The DEPUTY SPEAKER: The member for Unley is reminded he is on two warnings and I would hate to lose his contribution for the rest of the day.

The Hon. A. KOUTSANTONIS: Again, whenever they trash the conventions of the parliament, to disguise trashing those conventions, it turns personal. That is all the member for Unley has: personal attacks. That is all he has; that is all he has in his repertoire. It is not policy. He has not got up and argued a point of policy. In the end, I suspect the Liberal Party will support this measure. I suspect they are going to vote for it, despite the calls opposite, by saying, 'Yes, it's just another tax measure.' Yes, it is another tax measure that members opposite are going to support.

The reality is we did not have to be in here today with an increased surcharge from 4 per cent to 7 per cent; the budget could have been passed. If the opposition were so desperate to fight the bank levy at the last election, what they should have done—which is what the constitution is designed to do—is you say, 'The government's budgets are passed, and if you elect the opposition they will repeal it.' The opposition could have gone to the election fighting an opposition to the major bank levy, and we could have gone to the election defending the major bank levy, but the opposition are such strategic geniuses they block it.

We know now that, even if we win, this measure cannot pass. We won the last election and they did not pass our tax measures. Whatever we do, they are not going to support it because they are in the pockets of other interests. That is why we have to increase this levy from 4 per cent to 7 per cent. It has absolutely nothing to do with the SDA. It has nothing to do with any of the personal, vile, bitter attacks the member for Unley has, because that is all he has. It was not an issue on policy—

The DEPUTY SPEAKER: Point of order on my left.

Mr VAN HOLST PELLEKAAN: I ask you to apply your last ruling to the Treasurer. The comments he has been making for the last five minutes have nothing to do with stamp duty on foreign investors of residential property in South Australia.

The DEPUTY SPEAKER: The table apologises. We have been dealing with the next set of problems that we anticipate facing. We are going to listen very carefully to the Treasurer.

The Hon. A. KOUTSANTONIS: I thank the parliament for the speedy passage of the second reading and I am sure, given the discussions that I have had with the Hon. John Darley, the Hon. Dennis Hood, the Hon. Mr Brokenshire and the Hon. Mr Parnell, that this will have a speedy passage in the upper house as well. I suspect that the opposition will support it, too, but they may not. They may again go back to their wrecking ways, opposing measures.

Indeed, if this is such a terrible provision, why was there was no criticism of Gladys Berejiklian or Mike Baird when they introduced it in New South Wales, a Liberal government? There was no criticism of the major bank levy of Scott Morrison and the Prime Minister when they introduced it, but we have found out subsequently that secretly the Leader of the Opposition said he opposed it but just did not say anything to anyone. He kept it quiet, which I think speaks volumes. I commend the bill to the house and its speedy passage to the other house.

Bill read a second time.

Third Reading

The Hon. A. KOUTSANTONIS (West Torrens—Treasurer, Minister for Finance, Minister for State Development, Minister for Mineral Resources and Energy) (16:26): I move:

That this bill be now read a third time.

Bill read a third time and passed.