The Gillard Government today introduced into the House of Representatives legislation to establish the Australian Charities and Not-for-profits Commission (ACNC).
Assistant Treasurer David Bradbury said the establishment of the ACNC is the cornerstone of the Government's NFP reform agenda and would provide, for the first time, a dedicated regulator for the NFP sector.
"The NFP sector has long called for a dedicated national regulator that understands the sector and its needs, and the Gillard Government is committed to establishing the ACNC to drive the implementation of a national approach to regulation," Mr Bradbury said.
Minister for Social Inclusion, Mark Butler, said the new body was an essential step in the government's NFP agenda to strengthen and support the sector, reduce re-tape and create an independent one-stop shop regulator for the sector.
"This is about letting NGOs and charities get on with what they do best, rather than being weighed down by regulation and red-tape," Mr Butler said.
"The sector forms a vital part of our community and economy and, as it grows and develops, we want a regulatory framework that will support the sector's growth and the important activities it undertakes."
The Australian Taxation Office (ATO) is currently the de facto Commonwealth regulator of charities, with the dual roles of determining an entity's charitable status and enforcing the taxation laws.
The ACNC will serve as an independent national regulator, with a greater focus on the particular needs of the NFP sector. It will determine an entity's charitable status and provide information to the public about the NFP sector and the work that it does.
The Bill incorporates changes made in accordance with the recommendations in the House of Representatives Standing Committee on Economics report into the draft ACNC legislation.
The report made a number of constructive and useful recommendations which the Government has adopted and which have been included in the final version of the legislation. These include:
- Adding a new clause to the Objects in the legislation to make clear that the ACNC's role includes promoting a reduction in the regulatory burden on the NFP sector;
- Additional procedural fairness requirements where the ACNC Commissioner exercises particular powers under the legislation;
- Adding a statutory review provision to provide for a review of the legislation after it has been in operation for 5 years;
- A new power to make regulations to protect the privacy of private donors such as those who maintain a private ancillary fund;
- A substantial redrafting of provisions relating to directors' liability, clarifying that a director of an incorporated charity will only be liable under the Act where there is a deliberate act or omission of the director involving dishonesty, gross negligence or recklessness. No criminal offences will now apply to directors of an incorporated charity, as the one criminal offence relating to directors included in the exposure draft of the Bill has been removed. This will provide additional assurances and protections for volunteer directors.
The Government today also introduced the Tax Laws Amendment (Special Conditions for Not-for-profit Concessions) Bill 2012. This Bill re-states the 'in Australia' special conditions for income tax exempt entities, and codifies the 'in Australia' special conditions for deductible gift recipients.