Mr REPACHOLI (Hunter) (16:49): 

I rise to speak on the Treasury Laws Amendment (Responsible Buy Now Pay Later and Other Measures) Bill 2024. Everyone loves buy-now pay-later. It's almost like the good old days of lay-by, but you get to take the purchase home straightaway with you on the spot. When buy-now pay-later came onto the scene through businesses like Zip Pay and Afterpay, it boomed in popularity, and I can see why. It's a massive help to be able to purchase something that you might not be able to afford on the spot and be able to pay it off in instalments but still have the ability to own the product on that day. I know there are a lot of people and a lot of families, especially in my electorate, who rely on these kinds of payment systems to be able to get what they need when they need it. It's also great for our local businesses in the Hunter. It means that their customers can come in and buy things from their business without having to wait until the time when their bank accounts allow it.

This legislation is about making sure that those who use buy-now pay-later and those who rely on it are protected. This amendment brings buy-now pay-later products in line with other products, like credit cards and personal loans, by making sure that they are regulated properly under the credit act. The regulatory framework is designed to operate in a way that is flexible, adaptable and proportionate to the risk of the consumer's harm.

Buy-now pay-later was a great invention. It usually works by a third party providing customer finance to cover the purchase of goods and services, as well as the payment of bills. The providers, like Zip Pay or Afterpay, pay for the purchase upfront, and the customer then makes repayments in instalments. At face value, it's a great system which is helpful for so many people. But, sadly, the reality is that some people end up in over their heads. They end up having to repay more than what they may be able to afford. Regardless of how good and helpful something may be, there is always the potential for harm.

People ending up in financial hardship because of this must be avoided. Some of the time, this is a result of the providers of the buy-now pay-later businesses having poor product disclosure, inadequate dispute resolution processes, excessive default fees and unaffordable lending practices that lead to hardship and financial stress. This is because, even though buy-now pay-later products are a form of credit, they are not currently subject to the regulatory framework that applies to other credit products.

A product that is used by people to make life more affordable and to relieve the financial pressure of making big but necessary purchases should not lead to even greater financial pressure for those who use it. People use buy-now pay-later to be able to afford what they need, not to dig themselves into an even deeper financial hole than they would have been in if they hadn't used buy-now pay-later. This is why regulation is needed, and it is a must, to make sure that people who use this aren't taken advantage of and aren't finding themselves in positions of hardship financially after using the service.

The proposed amendments mean that customers using buy-now pay-later will be better protected and that the providers will conduct their operations in a way which is better regulated. The amendment will require providers to hold an Australian credit licence and comply with the existing requirements under the credit act, including the regulations for product disclosure, dispute resolution and hardship assistance. The providers will also be subject to responsible lending obligations. However, providers of products that meet strict fee caps, meaning they are categorised as low-cost credit, will have the option to comply with a modified RLO framework that allows certain requirements to scale down the proportion to the risk of the product.

These changes are about making sure that the level of regulation and protection for consumers is just right. They're about making sure that Australians can continue to make the most of the benefits that come with buy-now pay-later while being better protected as they use it. These amendments are wide ranging and help to make life better for Australians in many different areas. I could talk all day about how this bill will help provide for individuals and businesses in the Hunter and all around the country, but, for the benefit of those here listening today, I will keep it brief.

I know that a lot of people in my electorate are concerned about housing. We have been very focused on building more houses in the time that we have been in government. This bill helps to continue with that focus by encouraging investment in the build-to-rent sector, expanding Australia's housing supply. It does this by reducing the final withholding tax rate on eligible fund payments, which are distributions of rental income and capital gains, from managed investment trust investments to 15 per cent, down from 30 per cent. The amendment also increases the depreciation rate for capital works in eligible projects from 2.5 per cent per annum to four per cent per annum.

Medicare is one of the pillars that hold up our country. To be able to access high-quality health care regardless of how much money is in your bank is a right that so many people rely on. We are proud to have introduced Medicare, and we'll always protect it. That's what a Labor government does. Medicare is only made possible by the Medicare levy, but sometimes we need to make tweaks. This legislation ensures that the Medicare levy would not be payable in respect to eligible lump sum payments in arrears. In 2022 the Senate economics committee's inquiry into unlawful underpayment of employees' remuneration revealed an issue. There are existing offsets that compensate individuals for additional income tax and Medicare levy surcharge liabilities incurred as a result of receiving lump sum payments—for example, as compensation for unpaid wages. But these offsets do not compensate taxpayers for any of the additional Medicare levy incurred. We are putting this right, and we expect that up to 3,400 individuals will benefit from this.

Another change being proposed is in relation to multinational tax transparency. In the election we said that we would make sure that big multinationals would pay their fair share of tax, and this change makes sure they will. It's not fair that multimillion-dollar companies pay less tax than a hardworking mum and dad in my electorate trying to provide for their families. These changes are about putting this right.

We're also making changes to the deductible gifts to help encourage giving in the Australian community, which will be a massive help to all kinds of not-for-profit organisations and charities that rely so much on the generosity of Australians to be able to keep providing the amazing services and products that they do every day.

Another area of these amendments focuses on our skills and workforce. The Commonwealth and states have agreed to strengthen Australian skills through a landmark five-year national skills agreement. The agreement sees national cooperation and strategic investment in our vocational education and training sectors. This means that investment of up to $12.6 billion will help expand and transform access to the VET sector, support quality training and implement reforms to address critical skills needs.

There are also proposed changes that offset something for our small businesses. I know that in my electorate there are a lot of people who own their own business, and we need to support them in any way that we can. That's why we're extending the $20,000 instant asset write-off by 12 months until 30 June 2025 to improve cash flow and reduce compliance costs for small business. This means that a small business with an aggregated annual turnover of less than $10 million will be able to immediately deduct eligible assets costing less than $20,000. This is great news for many small business owners in the Hunter and for over four million small businesses across the country.

As you can see, this is a wide-ranging bill that touches on many different areas. But, because of this, people in my electorate will benefit in all kinds of ways, from being better protected when buying now and paying later to being able to get things that they need for their businesses through the instant asset write-off. There really is something for everyone. There are multiple changes being proposed, but they are also necessary changes. I commend the bill to the House.