This bill became law on Dec 5th, 2022.
Budget, tax & economy
From 1 July 2022, foreign workers in the Pacific Australia Labour Mobility schemeThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. pay a final 15 per cent tax on each dollar they earn in Australia instead of ordinary foreign residentA person who is not treated as an Australian tax resident, so different tax rules apply to their Australian income. tax rates.
The Pacific Australia Labour Mobility schemeThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. replaced or expanded older visa-based worker programs, but the special 15 per cent tax rules were left tied to the old seasonal worker program. This bill extends that tax and withholding treatment to the PALMThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. scheme and lets similar visa worker programs be added later by regulationA rule made under the Act that can later expand the tax treatment to similar visa-based worker programs without new primary legislation..
Australia already had a special 15 per cent final withholding taxA tax taken from a worker's pay that settles the tax on that income, so no further tax is usually due on that amount. for foreign workers in the old Seasonal Worker ProgrammeThe older program that the tax rule originally applied to; this bill updates the law so it also covers PALM workers., but the Pacific Australia Labour Mobility schemeThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. had become the broader labour program used to help employers fill workforce shortages while supporting Pacific nations and Timor-Leste. The bill responded by extending that tax and employer withholding treatment to PALMThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. workers from 1 July 2022 and creating a way to add similar visa programs later, with Parliament passing it in November 2022 and Royal AssentThe formal step that turns a passed bill into an Act of Parliament. following in December.
No significant public case against the Pacific labour mobility tax change itself is recorded so far; the main reservation in debate was about unrelated superannuationAustralia's retirement savings system, which is mentioned because some speeches criticised unrelated super rules in the wider bill package. provisions elsewhere in the wider bill package, not this 15 per cent withholding measure. Coalition speakers said they supported the labour mobility tax changes and only sought changes to Schedule 5A separate part of the wider bill package; the page says most debate concern was about this schedule, not the PALM tax change itself., so criticism of this measure appears limited and conditional rather than broad opposition.
Stephen Jones MP introduced this bill. It passed on the voices.
Did it become law?
Yes
Became law 05 Dec 2022
Final passage
Passed without a counted vote
1 recorded amendment or procedural vote was found, but no counted vote on the bill itself was recorded.
Passage speed
88 days
From introduction to the latest recorded parliamentary step
Meaning
From 1 July 2022, foreign workers in the Pacific Australia Labour Mobility schemeThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. pay a final 15 per cent tax on each dollar they earn in Australia instead of ordinary foreign residentA person who is not treated as an Australian tax resident, so different tax rules apply to their Australian income. tax rates.
Workers in the Pacific Australia Labour Mobility schemeThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. who count as Australian tax residents keep paying normal resident income tax rates, including access to the tax-free thresholdThe part of a resident's income that is not taxed at the bottom rate; the bill says PALM workers who are tax residents keep this benefit..
Approved employers must withhold 15 per cent from pay for covered foreign workers under the Pacific Australia Labour Mobility schemeThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia..
The law broadens this tax treatment beyond the old seasonal worker program so it covers the Pacific Australia Labour Mobility schemeThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. and can later be extended to similar visa-based worker programs by regulationA rule made under the Act that can later expand the tax treatment to similar visa-based worker programs without new primary legislation..
With effect from the 2022-23 income year, a final withholding tax of 15 per cent applies to each dollar of income derived by foreign resident workers under the Pacific Australia Labour Mobility scheme.Income Tax Amendment (Labour Mobility Program) explanatory memorandum
Longer-term workers under the Pacific Australia Labour Mobility scheme who qualify as residents for tax purposes will pay ordinary resident tax rates on their taxable income.Income Tax Amendment (Labour Mobility Program) explanatory memorandum
Employers making payments subject to the final withholding tax must withhold from each payment. Section 52 of the Taxation Administration Regulations 2017 provides that the amount to be withheld is 15 per cent of each payment. This ensures that Approved Employers withhold the correct amounts from payments to employees. [Schedule 4, item 26, paragraph 12‑319A(a) in Schedule 1 to the TAA 1953]Income Tax Amendment (Labour Mobility Program) explanatory memorandum
These amendments also allow this tax treatment to be extended to foreign resident workers under any programs prescribed by regulations and for regulations to prescribe visa names for these purposes. [Schedule 4, items 11, 13 and 27, paragraphs 840-905(b) and 840‑906(c) of the ITAA 1997 and subparagraph 12-319A(b)(iii) in Schedule 1 to the TAA 1953]Income Tax Amendment (Labour Mobility Program) explanatory memorandum
Context
Australia already had a special 15 per cent final withholding taxA tax taken from a worker's pay that settles the tax on that income, so no further tax is usually due on that amount. for foreign workers in the old Seasonal Worker ProgrammeThe older program that the tax rule originally applied to; this bill updates the law so it also covers PALM workers., but the Pacific Australia Labour Mobility schemeThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. had become the broader labour program used to help employers fill workforce shortages while supporting Pacific nations and Timor-Leste. The bill responded by extending that tax and employer withholding treatment to PALMThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. workers from 1 July 2022 and creating a way to add similar visa programs later, with Parliament passing it in November 2022 and Royal AssentThe formal step that turns a passed bill into an Act of Parliament. following in December.
PALMThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. scheme workers enter a tax system still tied to the old seasonal program
The 2022-23 income year began with labour mobility tax law still framed around the Seasonal Worker ProgrammeThe older program that the tax rule originally applied to; this bill updates the law so it also covers PALM workers. even as the broader PALMThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. scheme was in use.
User-provided bill summary and why introduced ↗Government introduces a bill to extend the 15 per cent PALMThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. tax rate
The second reading speech said the bill would ensure foreign residentA person who is not treated as an Australian tax resident, so different tax rules apply to their Australian income. PALMThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. workers paid a final 15 per cent withholding taxA tax taken from a worker's pay that settles the tax on that income, so no further tax is usually due on that amount. and would help employers meet workforce shortages.
Hansard ↗Parliament passes the bill
Both houses passed the bill in the same form, clearing the way for the PALMThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. tax and withholding rules to operate in law.
Parliamentary timeline ↗Royal AssentThe formal step that turns a passed bill into an Act of Parliament. makes the PALMThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. tax changes law
Royal AssentThe formal step that turns a passed bill into an Act of Parliament. turned the bill into an Act, locking in the 15 per cent final withholding treatment for covered foreign residentA person who is not treated as an Australian tax resident, so different tax rules apply to their Australian income. PALMThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. workers from the 2022-23 income year.
Parliamentary timeline ↗Legislative route
The bill was formally presented to the chamber and read a first time, which starts its parliamentary journey.
Introduced and read a first time
A minister or sponsoring member moved the second reading, opening the main debate on the bill's purpose and principles.
Second reading moved
The bill reached this recorded parliamentary step.
The bill reached this recorded parliamentary step.
Referred to Federation Chamber
The bill reached this recorded parliamentary step.
Referred to Committee (28/09/2022): Senate Economics Legislation Committee; Committee report (17/11/2022)
Referred to committee
APH bill page notesThe bill reached this recorded parliamentary step.
Reported from Federation Chamber
The chamber agreed to the bill at second reading, meaning it accepted the bill in principle and allowed it to continue.
Second reading agreed to
The chamber agreed to the bill at third reading, which completed passage through that chamber.
Third reading agreed to
The bill was formally presented to the chamber and read a first time, which starts its parliamentary journey.
Introduced and read a first time
A minister or sponsoring member moved the second reading, opening the main debate on the bill's purpose and principles.
Second reading moved
The bill reached this recorded parliamentary step.
The chamber agreed to the bill at second reading, meaning it accepted the bill in principle and allowed it to continue.
Second reading agreed to
The bill reached this recorded parliamentary step.
The chamber agreed to the bill at third reading, which completed passage through that chamber.
Third reading agreed to
Both houses passed the bill in the same form, completing parliamentary passage.
Finally passed both Houses
The Governor-General gave Royal AssentThe formal step that turns a passed bill into an Act of Parliament., turning the bill into an Act.
Key criticism
No significant public case against the Pacific labour mobility tax change itself is recorded so far; the main reservation in debate was about unrelated superannuationAustralia's retirement savings system, which is mentioned because some speeches criticised unrelated super rules in the wider bill package. provisions elsewhere in the wider bill package, not this 15 per cent withholding measure. Coalition speakers said they supported the labour mobility tax changes and only sought changes to Schedule 5A separate part of the wider bill package; the page says most debate concern was about this schedule, not the PALM tax change itself., so criticism of this measure appears limited and conditional rather than broad opposition.
No party represented in the debate opposed the PALMThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. tax measure itself.
Votes
The bill passed both chambers on the voices. The counted divisions below were about amendments or procedure, not final passage.
House agreed to the bill's third reading on the voices, so there is no list of individual Aye and No votes for final passage in that chamber.
Passed on the voices
In a voice vote, members call out Aye or No and the presiding officer judges which side has it. Individual names are only recorded if a formal division is called.
Senate agreed to the bill's third reading on the voices, so there is no list of individual Aye and No votes for final passage in that chamber.
Passed on the voices
In a voice vote, members call out Aye or No and the presiding officer judges which side has it. Individual names are only recorded if a formal division is called.
Amendments grouped by chamber. These cards include amendment outcomes recorded without a counted division.
Senate
Defeated 28 to 34. Support came from Liberal Party, Nationals, and minor parties and independents. Opposition came from Labor, Greens, and One Nation. Jacqui Lambie Network had split recorded votes.
The division did not change the Income Tax Amendment (Labour Mobility Program) Bill 2022; that bill was then agreed to and reported without amendments.
The Senate agreed to amendment (1), as recorded in the Senate Journal, without a counted division.
Carried on voices
The chamber decided this amendment without a counted division, so there is no list of individual Aye and No votes.
These are amendment votes, not the final passage vote on the bill itself. The bill passed both chambers on the voices.
Parliamentary debate
Start here — lead voices
Stephen Jones supports the bill because it extends the 15 per cent final withholding taxA tax taken from a worker's pay that settles the tax on that income, so no further tax is usually due on that amount. treatment to workers in the PALMThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. labour mobility scheme and related future schemes.
Read in Hansard ↗Wallace supports the labour mobility tax cut, saying it will help employers fill seasonal labour shortages and that the reforms are sensible.
Read in Hansard ↗Stuart Robert says the coalition supports most of the bill, including the labour mobility tax changes, but cannot back schedule 5A separate part of the wider bill package; the page says most debate concern was about this schedule, not the PALM tax change itself. because it would exempt faith-based superAustralia's retirement savings system, which is mentioned because some speeches criticised unrelated super rules in the wider bill package. products from the usual performance rules.
Read in Hansard ↗Farrell supports the bill, saying it updates the tax rules so workers in the PALMThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. scheme and similar labour mobility programs pay a 15 per cent final withholding taxA tax taken from a worker's pay that settles the tax on that income, so no further tax is usually due on that amount..
Read in Hansard ↗All speeches by bloc
2 speakers · 3 contributions · 2 support
Hansard records 2 separate contributions by Stephen Jones, including an amendment-moving contribution. They are grouped here so the speaker is listed once.
Moved amendment
Stephen Jones supports the bill because it extends the 15 per cent final withholding taxA tax taken from a worker's pay that settles the tax on that income, so no further tax is usually due on that amount. treatment to workers in the PALMThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. labour mobility scheme and related future schemes. He says this will help fill workforce shortages in Australia while also supporting economic development in Pacific nations and Timor-Leste.
“The PALM scheme will help meet workforce shortages in Australia as well as support the economic development of Pacific nations and Timor-Leste.”Read this contribution in Hansard ↗
Second reading speech
Jones supports the bill and says it should pass urgently so the Pacific Australia Labour Mobility schemeThe worker program this bill is about; it lets employers bring in workers from Pacific nations and Timor-Leste for jobs in Australia. can keep supplying seasonal labour to regional businesses, especially farmers facing labour shortages. He argues the tax settings make the scheme more attractive and help workers and their families through remittance income.
“Again, it's important that all members of the House understand that in the grip of labour market shortages around the country—but particularly affecting businesses in regional Australia, including agricultural and horticultural businesses—it is absolutely critical that these measures are able to pass the House and move to the Senate so they can be moved through the Senate and into law as a matter of urgency.”Read this contribution in Hansard ↗
“The PALM scheme will help meet workforce shortages in Australia as well as support the economic development of Pacific nations and Timor-Leste.”Read the full speech in Hansard ↗
3 speakers · 2 support · 1 mixed
“I've circulated two amendments in my name which I propose to move in consideration in detail. One of these amendments is to remove schedule 5 from this bill.”Read the full speech in Hansard ↗
“I do support a great deal of this bill. It's going to introduce sensible reforms, particularly in relation to labour mobility. It's great to see the Leader of the House in the chamber—this is the Federation Chamber, you might be lost! But we do want to work with the government to get this right. It is the very least that we can do for those 16 million hardworking Australians who rely upon their super. I encourage members of the government to look at our amendments. They are sensible amendments. They are good for Australians, they are good for super, and they are right and fair.”Read the full speech in Hansard ↗
“One of the important things in this bill for me is that it addresses employment of Pacific Islanders in Australia, their labour mobility clauses and the tax effects on them. Normally, international workers would begin to pay 32½ per cent tax on everything they earn immediately they arrive here. This is unfair to them compared to other workers who happen to be Australian nationals. What the government has done in this case is to say: 'All right. We'll start with you with a 15 per cent flat rate.' It's a massive change for them, but for their benefit.”Read the full speech in Hansard ↗
Record
House · Introduced and read a first time
Introduced
The bill was formally presented to the chamber and read a first time, which starts its parliamentary journey.
House · Second reading moved
Second reading opened
A minister or sponsoring member moved the second reading, opening the main debate on the bill's purpose and principles.
House · Second reading debate
Second reading debate
The bill reached this recorded parliamentary step.
House · Referred to Federation Chamber
Referred to Federation Chamber
The bill reached this recorded parliamentary step.
House · Second reading debate
Second reading debate
The bill reached this recorded parliamentary step.
House · Reported from Federation Chamber
Reported from Federation Chamber
The bill reached this recorded parliamentary step.
House · Second reading agreed to
Second reading agreed
The chamber agreed to the bill at second reading, meaning it accepted the bill in principle and allowed it to continue.
House · Third reading agreed to
Third reading agreed
The chamber agreed to the bill at third reading, which completed passage through that chamber.
Senate · Introduced and read a first time
Introduced
The bill was formally presented to the chamber and read a first time, which starts its parliamentary journey.
Senate · Second reading moved
Second reading opened
A minister or sponsoring member moved the second reading, opening the main debate on the bill's purpose and principles.
Senate · Second reading debate
Second reading debate
The bill reached this recorded parliamentary step.
Senate · Second reading agreed to
Second reading agreed
The chamber agreed to the bill at second reading, meaning it accepted the bill in principle and allowed it to continue.
Senate · Committee of the Whole debate
Committee of the Whole debate
The bill reached this recorded parliamentary step.
Senate · Third reading agreed to
Third reading agreed
The chamber agreed to the bill at third reading, which completed passage through that chamber.
Parliament · Finally passed both Houses
Passed both houses
Both houses passed the bill in the same form, completing parliamentary passage.
Assent · Assent
Assent
The Governor-General gave Royal AssentThe formal step that turns a passed bill into an Act of Parliament., turning the bill into an Act.
Senate Economics Legislation Committee; Committee report (17/11/2022)
Referred to committee
Referred to Committee (28 Sept 2022): Senate Economics Legislation Committee; Committee report (17 Nov 2022)
APH bill page notes
