Question 2

In June 1999, the House of Representatives in Federal Parliament passes the Taxation Reform Bill 1999, designed to simplify the tax regime in Australia and reduce personal income tax by 4% to boost the economy. The Bill is rejected in the Upper House, on the basis that the majority of the Senate believes that personal income tax should only be reduced by 2%. The Taxation Reform Bill 1999 does not proceed.

In January 2020, the House of Representatives, inspired by the Taxation Reform Bill 1999, decides to pass its own version of the Taxation Reform Bill, which reduces personal income tax by 3%. This time, the Senate is more receptive to the idea of tax reform, but sends the Bill back to the Lower House with suggested changes, effectively reducing personal income tax by 2.5%. The House of Representatives does not agree with the suggested changes.

Given this disagreement, the Governor-General then decides to intervene, exercising his powers to dissolve both houses. An election is called and the Australian public elect members to all the seats in the Lower House, and to half the seats in the Upper House. The Government is returned to office in the House of Representatives, but again does not have a majority in the Senate. To resolve this problem and try to have the legislation passed, the Governor-General then decides to select and appoint new members of the Upper House.

Please discuss any issues with the above process.