austcham news Issue 182 by The Australian Chamber of Commerce in Hong Kong

PSEPHOLOGIST EDITION The Australian Chamber of Commerce Hong Kong and Macau 香港及澳門澳洲商會

ISSUE 182, 2016

Australian Reflections: Federal Election 2016 y l u 2 J 16 20

P.16

Australia Focus: Australian Federal Budget 2016 - 2017

P.19

Committees in Action: COP21 and Beyond

Committees in Action: Marketing & Media Network A Brand New Start P.20

www.austcham.com.hk

Contents

austcham news issue 182 03 Chamber Chatter

03 Membership eCard Benefit

05 Events Update 5 July - Cybersecurity risks and how to protect your business

06 Cover Story

Editorial Committee: Drew Waters Karen Wu Claire Reaburn

Australian Reflections: Federal Election 2016

16 Australia Focus

Advertising: Karen Wu Email: karen.wu@austcham.com.hk

Australian Federal Budget 2016-17

18 Macau Highlights

CONNEC T • ENGAGE • REPRESENT

MGM Macau

The Australian Chamber of Commerce in Hong Kong and Macau has more than 1,500 members from some 500 companies doing business here. It’s the largest Australian business grouping outside the country and the second largest of 28 International Chambers of Commerce in Hong Kong. The AustCham mission is: To promote & represent Australian business & values while enabling members to connect, engage & grow bilateral relationships.

19 Committees in Action

Sustainability Committee: COP21 and Beyond Marketing and Media Network: A Brand New Start

22 New Members

23 On The Scene

Published By: The Australian Chamber of Commerce in Hong Kong and Macau Room 301-302, 3/F, Lucky Building 39 Wellington Street, Central, Hong Kong Tel: +852 2522 5054 Email: austcham@austcham.com.hk

Disclaimer:

austcham news Online version

The views expressed in this publication are not necessarily those of the Australian Chamber of Commerce in Hong Kong and Macau, its members or officers. The Australian Chamber of Commerce in Hong Kong and Macau takes no responsibility for the contents of any article or advertisement, makes no representation as to its accuracy or completeness, and expressly disclaims and liability for any loss however arising from or in reliance upon the whole or any part of this publication. Copyright © 2016 The Australian Chamber of Commerce in Hong Kong and Macau

2 • austcham news | issue 182

Chamber Chatter

Chairman's Column The Australian Federal Election is the main focus of this month’s AustCham News. I won’t comment too much in the lead-up to the Election except to note that while one might wish for all political parties in Australia to spend more time on policy and less time spruiking image, worrying about internal party matters, and obsessing about the next “minor win” in the war of words that the mainstream press gobbles up, Australia is doing a far sight better than many other nations in terms of having a debate of some substance over some (at least) policies that will matter a great deal to a great many in the electorate. Election talk aside, we have been working steadily to progress the proposed new Articles for the Chamber and, government approvals pending, I hope that we will be ready to present them to an EGM in September, or shortly thereafter. Proper notice will be sent to members in due course. Finally, I am honoured to have been re-elected as Chair of the Chamber. I congratulate Fiona Nott and Andrew Macintosh on becoming Deputy Chair’s, and I congratulate Darren Bowdern on being elected Treasurer, taking over from Andrew Macintosh. I am delighted to note that all positions had unanimous support. On behalf of all, heartfelt thanks to Melanie Nutbeam and Tom Corkhill for serving the Chamber so well for so long as deputies; both Melanie and Tom have chosen to take time out for other projects after longstanding service as deputies, and neither sought reelection as Deputy Chair. I hope that you will connect with the Chamber this month in some way, and that you will continue to share your views on how best the Chamber can serve you. Richard Petty chairman@austcham.com.hk

Membership eCard Benefit AustCham

Membership eC

ard

In Jun Celebrating Italy “La vita è troppo breve per mangiare e bere male.” (life is too short to eat and drink bad.)

In June, Sheraton Grand Macao is offering AustCham members 20% discount on dining at their Bene Restaurant. To celebrate the National Day of Italy, Bene has a series of colorful and exciting activities! A fun gourmet experience awaits with the arrival of World Champion of Pizza Acrobatics, Chef Pasqualino Barbasso, to whom you can toast with wines from the renowned Italian vineyards of Colle Massari. Visit Bene throughout the month and savour a specially-designed festive menu created just for the celebration. Soak in a true Italian ambience this month at Bene! Reservation: 853-8113 1200 or email bene.macao@sheraton.com

www.benemacao.com * Terms and conditions apply. * Please present your membership e-card to enjoy this offer.

issue 182 | austcham news

•3

Chamber Chatter

ow that summer has finally arrived, I find myself complaining about the heat, after an extended period of complaining about the cold and rain! It was put to me the other day, that we should adopt a dress code more like Singapore during the summer months rather than swelter in the convention of tie and jacket. I’d love to hear your views on that. Such a long election campaign has taken its toll on the Australian voting public it seems, so that the ever-changing polls have provided some of the most interesting parts to date. So much so, that some traditional pollsters have introduced alternative topics to promote additional interest in the main protagonists. It’s all looking surprisingly close, but we will be able to look back on the campaign, the results, and a newly formed Government at our Post Election Breakfast on 19th July. Reserve your seat now, as I’m sure the post-mortem will be humorous and lively. We were privileged to have HMAS Anzac visit Hong Kong on her way home to Sydney this month, and more so to have her Commander,

Across My Desk Belinda Wood, speak to our Women in Business Network in conjunction with The Women’s Foundation. Commander Wood engaged us with her vision of leadership in such close quarters, so similar to that of the corporate world with the exception of sending their staff into harms way. Thank you to the Consulate-General for making this possible, and to The Commonwealth Bank for the venue. The AustCham Mentor Programme kicks off this month with the much anticipated “Speed Matching” event at KPMG on the 28th. This is a great way for participants to mix and connect, and has provided some strong Mentor/Protégé pairings in the past. Unfortunately, ANZ is not able to support the programme this year, but I thank them for their longstanding commitment. This means that this high profile sponsorship opportunity exists with year-long exposure. Please contact Jason or me if your company would like to take advantage of this very visible programme. So! We go to an election on the 2nd with all sorts of possibilities. Perhaps I’ll see you at the polling booth? Drew Waters, Chief Executive

Let’s strive for a smoke-free Hong Kong

“H

ong Kong Smoke-free Leading Company Awards 2016” aims to encourage businesses to promote smoke-free messages to their stakeholders including employees, customers and the general public on a continuous basis. Hong Kong Council on Smoking and Health (COSH), partnering with various smoking cessation service providers, will assist businesses in setting smoke-free guidelines and internal policies, organising smoke-free activities and providing different smoking cessation services to encourage smokers to kick the habit. Outstanding smoke-free companies will be recognized for their commitment to a smoke-free corporate culture. Awards There are Smoke-free Leading Company Gold Awards, Silver Awards and Certificates of Merit.

Community Corner

Awardees will be presented with trophies or certificates at the Awards Presentation Ceremony scheduled in February or March 2017. Outstanding smoke-free policies of winners will be introduced in the Awards booklet 2016. For details, please check: http://smokefreeleadingcompany.hk/en/ Application is now open until 30 September 2016. Schedule June 2016

Open for application

30 September 2016

Application deadline

January 2017

Announcement of results

February or March 2017

Awards Presentation Ceremony

AustCham is a non-profit organisation and provides this space free of charge to other, selected non-profits or charities.

4 • austcham news | issue 182 成為無煙領先企業

獎項

A Letter from Canberra

I write, Australia is in day one of a 55 day double dissolution election campaign – one of the longest in our history. And, just hours ago, the 44th Parliament was officially prorogued. In the expectation an election was to be called on the weekend, much of last week’s Budget and Budget Reply parliamentary sitting was spent bidding farewell to retiring Members of Parliament, many of whom are long term and well known features on the Australian political landscape. One of them was the ‘Father Of The Parliament’, the Member for Berowra, Philip Ruddock. Philip has served the people of Berowra for an extraordinary 43 years and is the second longest serving member of the Australian parliament after William ‘Billy’ Hughes’ stint of 51 years. But Philip, who has been a tireless advocate on human rights, particularly against the death penalty, has no plans to kick up his heels and sign on for golf lessons. At 73, he will embark on a new chapter in his career as Australia’s first special envoy for human rights to the United Nations.

I discussed who might serve as co-chair in the 45th Parliament. Should I win re-election and again receive the honour of serving as co-chair, it’s comforting to know there is no shortage of talented and driven professionals who’ll help fill Philip’s sizeable shoes. With an election on its way, it’s important you know how you can vote overseas. All Australian citizens aged 18 years or over are required to enrol and vote in this election. For further information visit: http://www.aec.gov.au/Voting/ Ways_to_vote/overseas.htm Next month - news from the campaign trail. Gai Brodtmann MP, Federal Member for Canberra and Co-Convenor of Parliamentary Hong Kong Friendship Group

Over the life of this parliament, I have had the privilege of cochairing the Parliamentary Hong Kong Friendship Group with Philip. Many of you have probably met Philip on his visits to Hong Kong during his lengthy career, and knowing him, I’m sure you’ll be seeing him again. In the final hours of the sitting session, Philip and

EVENTS UPDATE JUNE AT A GLANCE… Wed, 29 June, 12:30pm – 2:00pm Championing Change – A View from the Top Minter Ellison, Level 25, One Pacific Place, 88 Queensway, Hong Kong

JULY AT A GLANCE… Tue, 5 July, 8:00am – 9:30am Cybersecurity risks and how to protect your business CBA Innovation Lab, 13/F, One Exchange Square, 8 Connaught Place, Central, Hong Kong

Tue, 19 July, 8:00am – 9:30am Post - Election Breakfast The Hong Kong Club, 1 Jackson Road, Central, Hong Kong Thu, 21 July, 6:00pm – 9:00pm Mix at Six More information to come.

Mark Your Diary!

SS China Forum 2016 4 November – ACCE tmas Mix 8 December – Chris

issue 182 | austcham news

•5

Federal Election 2016

Australian Reflections: 2

SATURDAY

A Snapshot on Where the Parties Diverge on Policy Coalition

Labor

Greens

Cut the company tax rate to 27.5 per cent for businesses turning over up to $2 million per year, but maintain existing rates for larger businesses.

Won't support any cuts to the company tax rate.

Increase tax on contributions from 15-30 per cent for people earning more than $250,000. Tax superannuation earnings above $75,000 per annum at 15 per cent.

A sliding scale of tax on superannation based on income starting at 0 cents in the dollar for those earning less than $19,401 increasing to 32 cents for those on $180,001 onwards.

Introduce two emissions trading schemes: one for the electricity sector and one for other large emitters; a 45 per cent drop in carbon emissions on 2005 levels by 2030.

Put a price on carbon and a levy on coal exports; no Australian greenhouse gas emissions within a decade; no new coalfired power stations or coal mines.

Turn back boats where safe to do so; keep regional processing but increase oversight; increase humanitarian intake to 27,000 by 2025.

Raise humanitarian quota to 50,000 a year; close regional processing centres and bring detainees to Australia for processing.

Will fully fund the Gonksi changes, including the final two years at a cost of $4.5 billion.

Supports fully funding the final two years of the Gonksi changes at a cost of $4.5 billion.

Company Tax Cuts Cut the company tax rate to 27.5 per cent for businesses turning over up to $10 million per year, dropping to 25 per cent for all businesses by 2026.

Superannuation Increase tax on contributions from 15-30 per cent for people earning more than $250,000. Super balances over $1.6 million to be taxed at 15 per cent, and a $500,000 lifetime cap on after-tax contributions.

Climate Change A 28 per cent reduction on 2005 levels by 2030; continue $2.55 billion in Emissions Reduction Fund to encourage companies to reduce emissions.

Asylum Seekers Turn back boats; keep regional processing centres open; keep Temporary Protection Visas available.

School Funding Will only fund four years of the Gonski changes, however will provide $1.2 billion to the states for the final two years the program was due to run.

6 â&#x20AC;˘ austcham news | issue 182

Federal Election 2016 Coalition

Labor

Greens

Will lift the freeze on Medicare rebates, restoring indexed increases to account for inflation from January 2017.

Opposed the Government's decision to freeze rebates for four years, and the decision to extend this freeze until 2020.

Rely on Fair Work Commission to keep current levels, though not legislate to protect penalty rates.

Use legislation to keep penalty rates at current levels.

Will likely initially stick with the Coalition's plans, but prioritise FTTP, then upgrade the remaining elements after the network is finished.

Remain committed to fibre to the premises as outlined in Labor's original plans for the NBN.

Medicare Rebate Freeze Will extend its freeze on the indexation of Medicare rebates by another two years, in a measure expected to save $925 million.

Penalty rates Will adhere to any Fair Work Commission ruling; some MPs support cutting Sunday rates to Saturday levels for some industries.

The National Broadband Network Using a multi-technology mix, which includes the copper network, Optus TV cable, a satellite network, and some fibre to the premises [FTTP].

- Source and content taken from ABC.net

Polls: Preferred PM

Primary vote

Turnbull’s preferred PM rating has increased for the first time since November

Turnbull’s preferred PM rating has increased for the first time since November 42%

LNP ALP Greens

36% 13%

PUP 0% Others

10%

Two-party polling based on preference flow at the last election. The poll results are based on a national survey of 1359 respondents (aged 18+) conducted by telephone from May 31 - Jun 2, 2016. Data is weighted by age, sex and location. SOURCE: IPSOS | GRAPHIC: EDMUND TADROS, LES HEWITT issue 182 | austcham news

•7

Federal Election 2016 Let’s hear what The Turnbull Liberal Team says: In this uncertain world, our nation needs political stability and a strong economic plan that creates local jobs and helps families in our community. We are asking Australians to back the Turnbull Coalition Team’s Plan for a Strong New Economy. Our Plan is carefully structured to provide jobs, growth and a secure future for local families. • An innovation and science programme bringing more great Australian ideas to market and preparing our children for the jobs of the future • A defence industry plan that will secure an advanced defence manufacturing industry and create thousands of new hitech jobs • Export trade deals to generate new export opportunities and give our farmers a competitive edge • Tax cuts and incentives for small businesses and hard working families • A sustainable budget with crackdowns on tax avoidance and loopholes • Guaranteed funding for health, education and roads

bassy staf f in oops and em tr g in it is Turnbull) V – 18 Jan er – Malcolm (Source: Twitt an st ni ha Afg

14 Feb – Reading story books at Cape York House in Cairns (Source: Instagram – Mal colm Turnbull)

18 Feb – Announcing the new Ministerial Team (Source: Twitter – Malcolm Turnbull)

24 Feb – Teal Ribbon

Day function

lcolm Turnbull) (Source: Twitter – Ma

Only the Coalition can form a strong and stable government with a clear plan for a strong and growing economy, while the alternative of a possible Labor-Greens minority government is a recipe for chaos. Our Plan will help local families and businesses get ahead with a sustainable budget that guarantees funding for the services Australian families need, such as health, education and roads.

16 Mar – Attending (Source: Instagram –

Harmony Day event

Malcolm Turnbull)

15 Apr – Meeting New Colombo Plan scholars in Beijing (Source: Twitter – New Colombo Plan)

- Content provided by The Liberal Party.

nity roof top it a commu 29 Apr – Vis ation Square car park der garden at Fe ram – Malcolm Turnbull) (S

Malcolm Turnbull

ource: Instag

ldren's 31 May – Visiting Sydney Chi lcolm Turnbull) Ma – tter Twi rce: (Sou l Hospita

Federal Budget 04 May – Talks about the new nbull) m Tur (Source: Instagram – Malcol

11 Jun – Visiting Sunshine Coast Community Sporting Hub (Source: Twitter – Malcolm Turnbull)

Let’s hear what the Labor says: Labor has a clear plan to build a stronger, fairer economy for all Australians. Labor’s plan is focused on supporting the transition in our economy and making investments for growth into the future. 27 Nov – Marching for rea

l action on climate change

rten) (Source: Instagram –Bill Sho

12 Mar – At

Africultures Fe

(Source: Instag

ram –Bill Shor

stival in Lidcom

ten)

The heart of this plan is our investment in Australia’s greatest resource: our people. We will invest in schools, TAFE and universities, as well as nation building infrastructure – roads, rail and a first rate National Broadband Network. Our plan will mean innovation and more local jobs in advanced manufacturing, renewable energy and services. Labor's nation building infrastructure will support growth now, and boost future productivity. Now is not the time for Mr Turnbull's $50 billion tax cut for big business.

wkesbury Show 15 Apr – Attending the Ha (Source: Twitter – Bill Sho

Labor does not accept that cutting penalty rates for low paid workers and giving tax cuts to big business is the answer – this will only take us backwards.

13 May – Visiting Domremy College

rten)

(Source: Instagram –Bill Shorten)

We will deliver our plan through responsible savings and fair tax reform. Building a stronger and more productive economy – without hurting the things that help it grow.

18 May – Meet (Source: Tw

with ACFS at Po

Key Policies: Labor’s Plan for economy Labor is focused on six key priorities to build a stronger, fairer economy that will support the economic transition today while driving productivity and living standards into the future. 1. Investing in people 2. Building Australia 3. Driving investment in renewables and new industry 4. Supporting innovation and startups 5. Helping small business 6. Budget repair that's fair

rt Botany

ten) itter – Bill Shor

21 May (Source: Twitter – Bill

Shorten)

- Content taken from The Labor Party “10 Year Plan for Australia’s Economy”.

25 May – Visiting Ovarian Cancer Australia (Source:

27 May – Meet Indigenous rangers at (Source: Instagram –Bill Shor ten)

Maningrida

Twitter – Ovarian Cancer Aust)

08 Jun – Meet students at TAFE Queensland (Source: Twitter – Bill Shorten)

Shorten issue 182 Bill | austcham news

•9

Federal Election 2016

Snapshot: Perceptions of Leaders

Malcolm Turnbull was regarded as a better source of advice investing money and giving advice to children about the future. He was also the preferred companion for dinner or for going on holiday.

Don’t Malcolm Bill Turnbull Shorten know 37% 53% Ask advice about investing money 11% 49% 34% Most trust to give your children advice about the future 17% 41% 38% Most like to have over for dinner 22% 57% 26% Most like to go on holiday with 17% 37% 36% Prefer to have negotiate your next pay rise 27% 57% 24% Most trust to cook a good meal 19% 51% 25% Most like to go to the footy with 24% 57% 22% Most like to have babysit your children 21% 58% 21% Ask their advice about a personal issue 20% 58% 20% Most trust to look after your pet 23% 43% 26% Most like to go to the pub for a beer with 30% 42% 26% Think would be more likely to lend you $100 if you needed it 31% 59% 17% Ask to help you with home renovations 24% 42% 21% Think would be more likely to stop and help if your car was stranded 37%

Q: Which party leader would you...

Bill Sho rten wa s more trusted to help if your c was stra ar nded or with ho renovat use ions. He was also conside red mor e likely t o loan you $100 if y ou needed it.

Source: Survey information taken from The Essential Report on www.essentialvision.com.au. The survey was conducted by Essential Research in May 2016, based on more than 1,000 respondents.

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10 • austcham news | issue 182

Australian Reflections: How Long Is Too Long? - Kerry-Anne Walsh, KA Communication

lot can of living can be packed into eight weeks.

It takes a normal home-owner about that time to sell a house. The average worker can give notice and find another job quicker; a restless Aussie could pack up and move interstate, dump a partner or find a new one in such a generous timeframe. Or maybe even become a monk in Tibet - an appealing thought, as Australians wade through the longest election campaign in seventy years. Eight weeks, two months, one-sixth of a year: whichever way you look at it, it’s a marathon of patience and endurance. Some newspapers have helpfully invented drinking and other games to while away the time. But if you downed a shot for every time PM Malcolm Turnbull roared the Government’s “jobs and growth” slogan, you’d be in rehab by now. And we’re only in week three. This campaign turns political strategy on its head. The more astute strategist knows not to unleash swarms of parliamentary wannabes over our neighbourhoods for much longer than the 33 days constitutionally required from the announcement of an election to polling day. They are attuned to the fact that the default position of the Australian voter is dull anger with the political class. But PM Malcolm Turnbull has become increasingly blind to the temperature of middle Australia since wresting control of the prime ministership from Tony Abbott last September. His popularity, he thought, would override established political wisdom. He wanted to be rid of a bothersome Senate filled with a ragtag of mercurial independents who have repeatedly thwarted his Government’s agenda. Thus, the only route available was a double dissolution election. The last remaining date to hold such a poll was July 2, which had to be called at the conclusion of the May budget sittings. So here we are, chugging in first gear to polling day. But while voting intention patterns over the last two decades show that most voters are rusted on to one of the major parties, undecided or switched off until the last week, political tragics are finding this slow-mo campaign gripping. Political fortunes these days turn on the charisma and performance of the leader. Since Bob Hawke in the 1980s cemented a presidential style of campaigning as the norm, all eyes turn to the Prime Minister and the person who wants the job. Unfortunately for Turnbull, his campaign isn’t going to plan. The more he campaigns, the less he is liked. Conversely, the more often Labor Leader Bill Shorten dons a high-vis vest, gladhands in shopping centres and rails against the Government’s ‘big business’ agenda, the more his stocks rise. The most common description used to describe the PM is ‘disappointing’. It’s emerged in the internal polling of both major parties. It stalks him on the election trail, as he struggles to find the common touch people thought he had. Watching Turnbull in crisp shirt in an outback pub downing a beer alongside a bemused local is the same as watching an embarrassing reality show. All you can do is turn your head until the ad break.

On the other hand, Shorten is at ease. He’s even taken up jogging. This has startled his colleagues who wistfully recall the time, when we were in a pre-campaign universe far, far away, that the most exercise Bill got was walking to the meat pie cart. And whereas Turnbull’s smart and savvy wife Lucy is keeping a low profile, Shorten’s exceptionally photogenic Monroesque wife, Chloe – daughter of former Governor-General Quentin Bryce – captures cameras’ attention more than a Kardashian on a red carpet. In the end, though, voters will be swayed by who they trust to run their affairs. But while Labor and Shorten’s electoral stocks have been rising, they need to win 21 seats to oust the incumbents. And despite Turnbull and his Government’s crashing popularity, they are still favoured as the next government. Labor’s primary vote lingers in the mid-30s. The victory bells won’t peel on that figure. There’s also a significantly high undecided vote, tracking at around 12%, which could splinter in myriad directions or favour one of the major parties. Once supporters of the Palmer United Party and other spectacularly failed experiments, where these voters park their vote will be critical in deciding which party occupies the Government frontbench. The new Senate voting rules, aimed at stopping micro parties from harvesting each other’s votes and vaulting a startled and unprepared candidate into the Senate with under 2% of the vote, as happened at the last election, may not have the outcome the PM desires. While it is early days, psephologists suggest whoever wins the Lower House may still have to navigate a hodge podge of independent and minor party senators. This may include perennial One Nation Leader Pauline Hanson, who still has her election-winning 1996 record spinning on the gramophone. You may remember the tune: it has the catchy title of “Asians Go Home.” Polling even suggests the woman who has only ever served one term in federal parliament but who has stood as a candidate in a smorgasbord of federal and state elections since – in between a stint in jail - may even hold the balance of power. But there are many slips and turns left. If we all make it to July 2, see you on the other side.

About the author: Kerry-Anne was one of Australia's leading national journalists and political commentators. She worked for 25 years at the highest levels in Australia's national media - as senior political correspondent for News Limited and Fairfax newspapers, on ABC radio, as a producer at Channel Ten, and as national political editor of the highly respected The Bulletin Magazine. Kerry-Anne is coming to Hong Kong and will speak at an AustCham event about post-election on 19 July 2016. Mark your diary! issue 182 | austcham news

• 11

Federal Election 2016

Policy outlines of the major parties: Federal Election 2016 - Thomas Gregory, Kreab

alcolm Turnbull called the 2016 Federal Election on 8 May, with polling day set for 2 July. This makes the campaign almost eight weeks long – one of the longest campaigns on record. So far the parties have announced many policies, but they will keep unveiling policies in the days leading to polling day. The Coalition announced its centrepiece economic policies in the 2016-17 budget, handed down in early May. On taxation, the Coalition has committed to a phased reduction in the rate of company tax, with immediate effect for small business. Under their policy, by 2026-27, the corporate tax rate for all companies will be 25%. The Coalition also announced that personal income tax thresholds will be lifted for some taxpayers. One of the most controversial elements of the budget was proposed changes to superannuation, with changes affecting contribution tax rates, the ‘pot’ of earnings that will be tax-free, and new limits to after-tax income contributions. The Government is running hard on its border protection record, but has no new policies to announce in this area. On defence, the Government recently has awarded a massive contract for submarine construction to French company DCNS, but intends for most of the work to be carried out in Australia, with a promise of jobs in South Australia. On trade, the Government has not yet announced additional trade deals, but is trumpeting those signed during the last three years, with Japan, Korea and China. The trigger for this double-dissolution election - the Senate’s blocking of the re-establishment of the Australian Building and Construction Commission - is the focus of the Government’s industrial relations policy. The budget also included a plan for a new youth internship scheme, to assist young people into work after school. The Coalition has promised additional funding in numerous areas – for schools, child care and infrastructure. On higher education, the Coalition has backed off plans to fully deregulate university fees, and has launched consultation on other options that will report back after the election. The Coalition has reached an interim agreement with state governments on health funding, but has raised the ire of doctors

12 • austcham news | issue 182

by its policy to freeze the medicare rebate. On climate change, the Coalition will continue with its ‘direct action’ policy on climate change. Finally, the Coalition has promised to conduct a plebiscite on marriage equality during 2016, with an undertaking to legislate accordingly. However, it remains unclear whether all Coalition members would be expected to vote along party lines. The Labor Opposition has announced some policies over the past months, and made its position clear on many of the Government’s economic policies in its reply to the budget. Since then, some additional policies have been announced, with more expected as the campaign goes into its final weeks. Labor’s most prominent economic policy has been aimed at making housing more affordable, by restricting negative gearing to new dwellings only (without affecting arrangements for existing assets), and by cutting the capital gains tax discount by half. Labor has indicated that It does not support the Coalition’s company tax cuts as a whole but has promised to reduce tax for small businesses. While Labor supports the changes to personal income tax thresholds, it has undertaken to reinstate the ‘deficit levy’, which effectively pushes the top tax rate back up to 49 cents in the dollar. On superannuation, Labor plans to tax annual earnings in the pension phase at 15%, and has also come out strongly in support of a royal commission into Australia’s financial services industry. On health, Labor has criticised the Coalition’s funding agreement with the states but has not yet announced how much funding it would provide, although it has announced that it would unfreeze the indexation of Medicare rebates. Labor has promised to fully fund the ‘Gonski plan’ for schools, worth about $37 billion over the next decade. On higher education, the Opposition will introduce 20,000 new free places per year for tertiary studies in science, technology, engineering and mathematics. Labor has also committed to more funding for the National Broadband Network, with a promise to connect more premises to the network directly with fibre cables. Labor supports the Government’s decision to build submarines in Australia. On trade, Labor is broadly supportive of the deals negotiated by the Government (indeed many of these were long term projects going back multiple terms of government.) On climate change, Labor will reintroduce an emissions trading scheme, and increase the renewable energy target. Labor is largely in support of the Government’s border protection policies, though it has promised to speed up processing, increase regional cooperation and increase Australia’s intake of humanitarian visa applicants.

Labor has announced additional child care funding, with increases to payments and rebates for families. Labor has also undertaken to legislate for marriage equality within 100 days of taking office. The Greens have announced some policies, with more detail expected as the campaign goes along. Though the Greens are aiming to pick up a few additional seats in the House of Representatives, under the electoral maths of a double dissolution election they will struggle to hold their record ten seats in the Senate. On taxation, Greens policy is to introduce a so-called ‘Buffet Rule’, under which individuals with income over $300,000 will be have a guaranteed minimum tax assessment of at least 35% of their pre-tax income, regardless of their final taxable income. The Greens do not support the Government’s corporate tax cut, and have proposed a tax avoidance crackdown, including an enhanced public disclosure regime. The Greens would also negative gearing for all assets, with grandfathering for arrangements entered before the policy comes into effect and progressively remove the entire capital gains tax discount over five years. On superannuation, the Greens would replace the flat tax of 15% on superannuation earnings with a progressive scale, much like what applies to income tax. Greens policy is to also prohibit superannuation funds from direct borrowing to invest in housing. The Greens were the first of the three parties to advocate for a royal commission into the financial services industry, and have indicated a particular interest in examining the vertical integration of banks. On trade, the Greens are generally disinclined to support bilateral trade agreements, and would end live export of animals. On Health, the Greens propose to unfreeze medicare rebates, and progressively remove the rebate for private health insurance. The Greens have announced they would end Australia’s offshore processing of asylum seekers, who would be brought to Australia for processing. As part of their climate policy, the Greens have announced steeply increased renewable energy target of 90% by 2030. The Greens have also announced plans to invest tens of billions more in public transport. The Greens would legislate for marriage equality.

For Australians in Hong Kong, the election policies of all three parties discussed above could have considerable impacts. Proposed changes to superannuation, negative gearing and capital gains tax could impact Australians with savings, investments and income in Australia. For those with children considering tertiary study in Australia – or those considering it themselves – the ongoing debate around deregulation and commonwealth funding and could have considerable impacts on university places as well as the cost of education. If the Labor/Greens proposals for a royal commission into financial services were to go ahead, there could be significant impacts on Australian financial institutions. Negative revelations and reporting could damage individual institutions as well as affecting the reputations of the industry generally, including in Asia; and the eventual commission recommendations and associated policy responses could negatively affect institutions’ business both domestically and internationally. Both major parties are generally supportive of bilateral trade agreements, and both exhibit near unanimous support for the China free trade agreement. The Government is talking up its success in finalising three bilateral trade agreements, as well as the Trans-Pacific Partnership, and is working on new agreements with Indonesia and India. Labor’s chief concerns with the China trade agreement are around labour market testing, base pay rates for 457 visa holders and skills testing. However, Labor has indicated that its concerns could be dealt with through other measures (without undermining support for the agreement itself). The Greens do not support the China trade agreement on the basis of the investor-state dispute-settlement provision, in addition to more general concerns about the efficacy and value of free trade agreements. About the author: Thomas is an expat working in Hong Kong at global strategic communications consultancy Kreab.

2016 AD-AustCham.ai 1 5/30/2016 2:22:30 PM

Australian Federal Election - Saturday, 2 July 2016 HOW TO VOTE IN HONG KONG & MACAU

Email: consular.hkng@dfat.gov.au www.hongkong.china.embassy.gov.au

Check your eligibility to vote

Vote in person

Please check your enrolment: www.aec.gov.au. You will need to know which Australian address you are currently enrolled at. If you are not already enrolled, it is now too late to enrol or update your details for this election.

Early voting opens 20 June until Saturday 2 July (excluding Sunday 26 June) at the Hong Kong Polling Centre: Australian Consulate-General 24/F Harbour Centre, 25 Harbour Road, Wanchai. Check our website for specific voting times.

Vote by Post

Apply online or download a Postal Vote Application form at www.aec.gov.au.

If you are unable to visit the Hong Kong Polling Centre, or complete a postal vote, you should notify the Australian Electoral Commission. Non-resident Australians will not lose their citizenship entitlement if they do not vote.

issue 182 | austcham news

• 13

Federal Election 2016 ELECTION DAY: Saturday 2 July 2016

Vote In person

Where: Australian Consulate-General Hong Kong Voting Centre Address: 24/F Harbour Centre, 25 Harbour Road, Wanchai

After 20 June 2016 Complete postal vote form http://www.aec.gov.au/pvaform in BLOCK LETTERS and return signed form to the Australian Consulate-General Hong Kong. All ballot papers must be received by 1 July.

When: 20 June to 25 June 2016 9:00 to 5:00pm (Closed Sunday 26 June 2016) 27 June to 30 June 2016 9:00 am to 7:00pm 1 July 2016 (public holiday) 9:00 am to 5:00pm

By email: Consular.hongkong@dfat.gov.au

Postal vote Apply online or download a Postal Vote Application form at www.aec.gov.au. Postal vote applications must be received no later than 6pm (4pm HKT) on the Wednesday 29 June 2016, however you need to allow sufficient time to receive your ballot papers, complete them and return them. Ballot papers must be completed and posted back to the AEC on or before Election Day. AustCham AD (204 x148mm) Layout JAN_2016 OP.pdf

Melbourne

8/1/16

By mail: Assistant Returning Officer Australian Consulate-General 23/F Harbour Centre, 25 Harbour Road, Wanchai, Hong Kong By fax: +852 2585 4457 For more information, visit http://www.aec.gov.au/Enrolling_ to_vote/overseas/index.htm or check The Australian Consulate-General Hong Kong and Macau website http:// hongkong.china.embassy.gov.au/hkng/home.html Check your enrolment online at www.aec.gov.au 5:20 pm

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14 • austcham news | issue 182

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The Australian Chamber of Commerce in Hong Kong & Macau (AustCham)

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W www.austcham.com.hk

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Member Classifieds Australia Registered Tax Agent in Hong Kong

Holistic Business Consulting Pty Ltd. Chartered Accountant We specialise in tax planning for Australian Expatriates, tax returns preparations, private rulings for deductions. www.myoztax.com Call Tommy Ip on +852 69018136 or email: tommy@myoztax.com

To enquire about advertising, submit an article, comment or respond to austcham news, please contact Karen Wu at karen.wu@austcham.com.hk or call +852 2522 5054.

issue 182 | austcham news

â&#x20AC;˘ 15

Australia Focus

Australian Federal Budget 2016-17 - AustCham Finance, Legal and Tax Committee

he government is seeking to elevate this year's Budget to a long term "economic plan" that will support Australia's transition into an advanced and diverse economy. Treasury is projecting a stable macroeconomic picture - the economy growing at a healthy rate of 3% from 2017-18, unemployment at a rate of 5.5% and inflation within the reserve banks zone of comfort however the government is still forecasting deficits up to 2019-20. The 2016-17 Budget introduced a number of significant tax policies that include a phased reduction to the corporate tax rate, the introduction of a diverted profits tax, and a number of superannuation as well as personal tax changes. Despite these, the package of measures fell well short of the comprehensive tax reform hoped for and as such broader structural taxation reform is still needed. Corporate tax The government will reduce the corporate tax rate, ultimately to 25% on an 11 year phased basis, depending on turnover, commencing 1 July 2018. The government has indicated that lowering the corporate tax rate is part of its plan to promote Australia’s economic growth and to encourage investment and it is expected that the reduction will increase GDP by 1% over the long term. The rate cut will commence with a reduction for small business companies (annual aggregated turnover of up to AUD$10m) to 27.5% from the 2016-17 income year. The annual aggregated threshold will then be progressively increased to have all companies taxed at 27.5% in the 2023-24 income year. From the 2024-25 income year the tax rate will be reduced for all companies to 27% and then reduced by 1% per year until it reached 25% in the 2026-27 income year. These rate reductions will apply to all companies (resident and non-resident) and to other entities taxed like companies such as public trading trusts and limited partnerships. Diverted profits tax The government will introduce a new diverted profits tax (DPT) with effect for income years beginning on or after 1 July 2017. The DPT is modelled on the second limb of the UK’s DPT, the first limb of which was adopted in the 2015 Budget as the multinational antiavoidance law (MAAL). This provision is aimed at arrangements involving transactions with overseas related parties which are

16 • austcham news | issue 182

subject to a tax rate which is less than 80 percent of the tax rate applied in Australia, where the arrangement lacks economic substance. Essentially, the objective of the DPT is to change the balance of negotiation with large business on transfer pricing and structuring issues. The DPT will impose a penalty tax rate of 40 percent, and any purported underpayment of tax determined by the ATO is payable upfront. In addition, the DPT assessment will include an interest charge for the period from when any amount would have been payable on the relevant income tax assessment, to the issue of the ATO’s DPT assessment. Superannuation This year’s budget has focussed strongly on superannuation with a number of changes being announced. Some of these will impact the ability of some Australians to save for their retirement, while others provide incentives and opportunities for lower income earners. Some of the measures which will apply from 1 July 2017 include: • The age at which Australians will have to satisfy a work test to be able to make superannuation contributions will be increased from 65 to 74 years of age; • Australians up to the age of 75 will have the ability to claim a deduction for personal superannuation contributions regardless of their work circumstances; • The ‘Income threshold’ at which high income earners pay an additional 15% tax on concessional contributions made will be reduced from AUD$300,000 to AUD$250,000. ‘Income threshold is Taxable Income + reportable fringe benefits + investment losses + taxed contributions • Refund of all contributions tax in accumulation on death ceases 1 July 2017; • Concessional contribution caps (for contributions which come from pre-tax income) are to be reduced to AUD$25,000 per annum for all ages. Only for those with balance less than $500,000, unused concessional cap accruing from 1 July 2017 is carried forward on a rolling basis of 5 consecutive years (i.e. max of $125,000); • A lifetime cap of AUD$500,000 will be applied to nonconcessional contributions, retrospective to 1 July 2007, indexed annually $50,000 with AWOTE index. The cap takes effect immediately and applies to all non-concessional

• • •

•

contributions made after 1 July 2017. Excess of the cap before commencement will not be regarded as excess and allowed to be retained in system. If exceed the cap post commencement, must withdraw excess or otherwise penalty applies. Insurance proceeds (e.g. TPD) should not impact the cap another reason to have more insurance in superannuation. Doesn’t affect other traditional contribution caps - Small business CGT contributions & Personal injury contributions; The amount of a person’s superannuation balance that can be transferred into a pension phase will be restricted to AUD$1.6 million, where future earnings are tax free and unrestricted thereafter. Those already in pension phase will be expected to reduce their retirement balance to AUD$1.6 million by 1 July 2017 with the options of returning the excess amounts back to accumulation (earnings taxed at 15%) or withdrawal from superannuation. $1.6M cap annually indexed in $100k increments in line with CPI. Unused ‘cap space’ on subsequent transfer is done on a proportional basis (e.g., previously utilised 75% of cap, will have 25% left of current (indexed) cap; Transition to retirement income streams continues, but fund earnings taxed 15%, no grandfathering, readjustment to cap $1.6M needs to be done by 1 July 2017;

• Raising income threshold to $37,000 (from $10,800), Low Income Spouse superannuation Tax Offset of $540 (based on $3,000 contribution) for contributing spouse, cut out at $40,000 • Low income earners will receive a tax offset up to max of $500 (based on $3,330), for up to ATI of $37,000 to their super fund to compensate for tax paid on their super contributions. Personal Tax The budget seeks to address bracket creep by increasing the income threshold at which the 37% rate commences from AUD$80,000 to AUD$87,000 from 1 July 2016. This will provide a small tax cut to middle income earners, but falls short of providing the cuts to taxpayers across the board that full indexation of tax brackets would have achieved. Despite this measure, across OECD countries, Australia will still have one of the highest income tax rates for a single person earning the average national wage, at 22.7%. By comparison, rates in New Zealand, the US and the UK are much lower, at 17.6%, 16.5% and 12.8% respectively. In addition to the above and consistent with announcements leading into the Budget, there have been no changes made to negative gearing or the taxation of discount capital gains.

issue 182 | austcham news

• 17

Macau Highlights

Macau Highlights @ MGM Macau

GM MACAU is a Forbes Five-Star luxury integrated resort inspired by the arts with every element of the resort infused with creativity and style. MGM MACAU has approximately 600 guest rooms and suites and boasts a number of distinguishing features, including the architecturally stunning European-inspired Grande Praça, housed under a soaring glass ceiling. MGM MACAU’s world class facilities include an Art Space dedicating over 8,000 square feet to display authentic works of art, conference and event facilities, an award-winning spa, and nine signature restaurants and bars to fulfill any gastronomic craving. Our property is conveniently located on prime waterfront on the Macau Peninsula and is directly connected to the luxury retail shopping complex, One Central. Recently at MGM MACAU we have created a campaign called “Fun for Everyone”. The program include a sculpture collection by legendary French artist Edgar Degas exhibited at MGM Art Space, complimented by the colorful, large butterflies hovering the Grande Praça as well as gourmet themed dinners, special tea sets, treats at our signature restaurants and cafes. Edgar Degas – Figures in Motion A highlight program under Le French May, Edgar Degas – Figures in Motion presents 74 bronze sculptures never been shown in Hong Kong and Macau. Degas is known as one of the founders of Impressionism and is famous for his paintings, sculptures, prints and drawings. Interactive elements including guides to walk guests through the story of the art and opportunities for fun photos are also included. The exhibition is copresented by Le French May and M.T. Abraham Foundation for the Visual Arts, supported by the French Consulate General of France in Hong Kong & Macau, and exclusively sponsored by MGM. The exhibition is now open for public until November 20, 2016 with free admission. Butterfly Garden at the Grande Praça The U.S. based maestro of oversized visual display art Stephen Stefanou is once again taking charge of embellishing Grande Praça with colorful butterflies that are much adored by all. Over 160 vibrant Monarch and Morpho butterflies made in synthetic glass hang above young Laurel trees making it the perfect indoor garden for quality time and pictureperfect moments with family and friends. MGM Fun for Everyone At MGM MACAU a wide array of fun and entertainment is in store for everyone’s enjoyment as we continue to invest in diversification and driving Macau as an international tourism and leisure destination. Gourmet themed dinners, special tea sets, sweets and treats at MGM MACAU’s signature restaurants and cafes are guaranteed to create great moments for all. Special offers for accommodation, retail and spa as well as social media promotions are not to be missed! - Content and images of the advertorial provided by MGM Macau.

18 • austcham news | issue 182

Committees in Action

Sustainability Committee: COP21 and Beyond

he agreement reached at COP21 will continue to have sweeping effects on global economic and energy policy, as well as environmental quality and personal lifestyles of societies throughout the globe. Subsequently, the growing importance for businesses to actively engage in sustainability targets has never been more pertinent.

The ‘COP21 and Beyond: What’s in it for Business’ luncheon had invited CLP Holdings’ Chief Executive Officer Richard Lancaster to share with members his insights and explore COP21 through the business lens: how its outcomes could affect business strategy and operations, and what action should companies take. Thank you to the support from CLP.

Richard Lancaster, Chief Executive Officer, CLP Holdings.

Guenther Rittner of ThyssenKrupp Elevator AG Asia Pacific and Pak-cheong Lo of CLP.

Wissam Elkassir of Spaceframe Construction & Engineering and John Chai of BEC.

Jim Taylor of CLP and Andrea Leung of British Consulate-General HK.

Eric Chong of Siemens and Anne Kerr of Mott MacDonald.

Peter Weiley of Advisian Ltd and John Ng of Hong Kong University.

Hannah Routh of PwC and Hendrik Rosenthal of BASF East Asia Regional HQ Ltd.

Niamh Targett and Eliza Mathews of ANZ.

Guest Speaker Richard Lancaster and AustCham Chief Executive Drew Waters.

CQ Lu of National Australia Bank and Adrian Ryan of The Australian Association.

Patrick Daley of Berwin Leighton Paisner (HK) LLP and David Simmonds of CLP.

Justin Li of Construction Industry Council and Chris Telford of Leighton Asia.

issue 182 | austcham news

• 19

Committees in Action

Marketing and Media Network: A Brand New Start

he team at AustCham are handpicking a group of the best marketing and media minds in Hong Kong and would be delighted to invite you (or a member of your marketing team) to leap into action and to show us what the most alert minds on the marketing scene are getting up to.

Objectives of the Network: - Engage and recruit new members with an interest in Marketing & Media - Empower members to leverage the benefits of Marketing by education, skill development and critical discussion - Add value to sister Chambers through collaboration to develop Marketing content for their members The Marketing & Media Network steering committee is chaired by Chris McMillan and will comprise some of the region’s top marketing and media professionals and thought-leaders.

If you have any enquiry about the network or would like to get involved, please contact the Chamber Secretariat for details. AustCham has a robust and enthusiastic committee system, comprising respected industry influencers. We use these committees to maintain the link between the Chamber Secretariat and the day to day challenges and triumphs directly from the coal face. We look forward to developing the new Marketing & Media Network and sharing our outcomes across the Chamber’s membership.

What issues around Marketing keep you awake at night?*

Cost Spin

Bosses are still stuck in the traditional/old school marketing and don’t understand digital/ new media

T he Not sure it last cold caller works How to transform customer experiences with limited resources

Not enough alcohol?

Don’ t do enoug h

ROI

20 • austcham news | issue 182

k L ac of ent l a t

Explaining to people that What a social media is bou comms? t not king

Demonstrating marketing does contribute to profit

Probably not enough budget