The Bill seeks to amend the ITAA 1997 and the ITAA 1936 to remove tax deductibility for contributions and gifts to political parties, independent members and independent candidates. The Bill also seeks to amend the GST Act to ensure that the GST treatment of these entities is not affected by the income tax amendments. The measures, if passed, will apply to contributions and gifts made on or after 1 July 2008 as announced in the 2008-09 Budget.
The effect of the Senate's amendments is to restore the ability of individuals (but not companies) to claim tax deductions for donations up to $1,500 made to political parties.
The Bill now returns to the House for consideration of the Senate amendments.