Finance minister says rules that allow MPs to claim both travel allowance and tax deduction for the same property are independently set

This article is more than 4 years old

This article is more than 4 years old

The finance minister, Mathias Cormann, has defended politicians receiving both a $273 a night travel allowance and tax deductions for mortgages and rents for properties in Canberra.

Speaking on Insiders on Sunday, Cormann said the remuneration tribunal granted the travel allowance and the tax office allowed deductions for politicians’ accommodation expenses.

Federal politicians receive $273 a night to stay in Canberra, a travel allowance they can claim even when they stay in a property that they or their partner own.

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Reports have revealed that on top of the allowance, MPs who rent or buy a property to stay in during work-related travel can also claim tax deductions for rent, interest on borrowings used for the acquisition of the property, rates, taxes, insurance and general maintenance.

The Daily Telegraph said that Cormann was a “beneficiary” of the policy and listed a number politicians on both sides of the aisle who owned property in Canberra, including Julie Bishop, Michaelia Cash, Richard Marles, Tanya Plibersek and Penny Wong.

On Insiders, Cormann said the travel allowance was set independently by the remuneration tribunal and tax rules were set independently by the tax office, and applied equally to all members of parliament.

“I comply with all of the rules. Of course the tax ruling for members of parliament, which is quite comprehensive ... provides what deductions can and cannot be made. I provide all of that information to my accountant,” he said.

Cormann rejected host Barrie Cassidy’s characterisation of the practice as double-dipping. “I don’t make the rules. None of us as politicians make the rules, we are expected to comply with them.

“None of these are new rules.”

Asked why politicians didn’t change the rules, Cormann replied it was appropriate that allowances and deductions be determined independently.

The opposition’s finance spokesman, Tony Burke, who’s been in federal parliament since 2004, said he wasn’t aware of the tax rules.

Burke also said it was entirely appropriate for the independent remuneration tribunal and tax office to set the pay and tax rules for MPs.

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“Politicians are the last people who should be determining what the rules for politicians are,” Burke told the Nine Network.

The Labor leader, Bill Shorten, said: “I understand that what has been reported today is within the rules.

“For myself, I was not aware you could do that. For better or for worse, I own one house and I live in it. So I have not made those claims. I understand they are within the existing rules, set by an independent tribunal.”

The prime minister, Malcolm Turnbull, said: “It’s very important that politicians pay and allowances ... [and] tax rules relating to tax deductions are not set by the politicians.”

He said the rules on tax deductions set by the tax office were “in line with business expense deductibility”.

“So that’s ... how it is and that’s how it should be and how it has been for a very long time.”

Asked about her personal use of the $273 overnight allowance, Labor’s deputy leader, Tanya Plibersek, said she claimed the usual entitlements set out in the framework, “same as everybody else”.

“If I could spend every night in Sydney with my family and never have to stay overnight in Canberra, I would be delighted,” she said. “But sadly my work takes me away from home quite often and, when I am away from home overnight, I claim [the] travel entitlement to do that.”

