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1998
Explanatory note
This explanatory note relates to this Bill as introduced into Parliament.
Clause 2 provides for the commencement of the proposed Act on the date of
assent or otherwise in accordance with the provisions of the clause.
Clause 3 is a formal provision giving effect to the amendments to the
Accommodation Levy Act 1997 set out in Schedule 1.
Clause 4 is a formal provision giving effect to the amendments to the Duties
Act 1997 set out in Schedule 2.
Clause 5 is a formal provision giving effect to the amendments to the Land
Tax Act 1956 set out in Schedule 3.
Clause 6 is a formal provision giving effect to the amendments to the Land
Tax Management Act 1956 set
out in Schedule 4.
Clause 7 is a formal provision giving effect to the amendments to the Legal
Profession Act 1987 set out in Schedule 5 .
Clause 8 is a formal provision giving effect to the amendments to the
Pay-roll Tax Act 1971 set out in Schedule 6 .
Clause 9 is a formal provision giving effect to the amendments to the Stamp
Duties Act 1920 set out in Schedule 7.
Clause 10 is a formal provision giving effect to the amendments to the
Taxation Accommodation Act 1996 set out in Schedule 8.
Schedule 1
Amendment of Accommodation Levy Act
1997
Schedule 1 [1] and
[2] extend the accommodation levy imposed under the
Accommodation Levy Act 1997 to accommodation provided at the club
premises of registered clubs. Schedule 1 [7] (proposed section 11B) exempts
from this liability residential accommodation provided by a club to persons
who art' full members of the club.
Schedule
I [2] also excludes from the levy residential accommodation
provided on vessels.
Schedule 1 [3] by
changing references to the "Treasurer" to references to
the "Minister". will, if it is desired to do so. facilitate any future transfer of
the administration of the Act.
Explanatory note page 2
Schedule 1 [4] and [5] reduce the amount of the levy in respect of a place of
accommodation that has. on or before 3 1 December 1997. signed a contract
with SOCOG committing accommodation to the Olympic Games. or that was
not presented with such a contract before that date. The reduced amounts are:
·
5 % (instead of 10%) for the period from 1 September 1997 to 31
March 1998. and
·
7% (instead of 10%) for the period from 1 April 1998 to 31 August
1998.
Schedule 1 [6] excludes certain charges from the determination of the
amount paid or payable for residential accommodation for the purposes of the
Act. The charges excluded are:
· booking fees or commissions
amounts for residential accommodation provided in a dormitory that
has communal or self-catering facilities
amounts for residential accommodation provided under the Homestay
or Homehost programs for the Olympic Games
· amounts for residential accommodation provided as overflow
accommodation at the request of a welfare organisation.
Schedule 1 [7] (proposed section 11A) exempts from the levy amounts paid
by the same person for accommodation that exceeds 28 consecutive days.
Schedule 1 [8] replaces the requirement for the lodgment of monthly returns
by the managers of places of residential accommodation with a requirement
that returns be lodged quarterly.
Schedule 2
Amendment of Duties Act 1997
Transactions concerning dutiable property
Schedule 2 [ l ] and [3] exempt from the payment of transfer duty the vesting
of dutiable property by or as a consequence of a statute.
Schedule 2 [2] and [24] seek to make it clear that a buy-back of shares is. for
the purposes of the Duties Act 1997. a transfer of property.
Schedule 2 [4] and [5] relate to the liability to transfer duty of:
·
a transfer of intellectual property that relates to the goodwill of a
business that is transferred. and
m
a transfer of goods that relates to other dutiable property that is
transferred.
Explanatory note page 3
They provide that any common arrangement relating to intellectual property
and goodwill. or to goods and other dutiable property, is to be subject to
transfer duty even if effected by separate transactions.
Schedule 2 [6] seeks to ensure that the duty payable on a partition that
includes property that is not dutiable property does not exceed the duty
payable on a simple transfer of the dutiable property.
Schedule 2 [7] substitutes section 31. The substituted section deals with the
effect. for the purposes of adjusting liability to transfer duty. of an extended
range of circumstances that can result in the change in the purchase price of
dutiable property after an agreement for the transfer of the property is entered
into and before the property is transferred.
Schedule 2 [8] provides a concession in relation to the payment of transfer
duty for dutiable transactions involving marketable securities quoted on the
market operated by the Stock Exchange of Newcastle.
Schedule 2 [9]. [12]-[14] and [39] (the definitions of managed investment
scheme and responsible entity) provide for the payment of concessional duty
of $10 on certain transfers of dutiable property in the administration of a
managed investment scheme (being a managed investment scheme within the
meaning of the Corporations Law that complies with Chapter 5C of that Law.
and including a public unit trust scheme).
Schedule 2 [10] inserts proposed section 49A which contains the provisions
that are to apply to the payment of transfer duty for purchases "off the plan."
Schedule 2 [15] clarifies the circumstances in which there is no change in the
beneficial ownership of dutiable property in certain superannuation funds and
trusts.
Schedule 2 [16] extends the exemption from transfer duty for the transfer of
a mortgage so as to include a transaction arising from a transfer of an interest
in a mortgage and a transfer of a charge over property.
Schedule 2 [17] exempts from transfer duty the vesting of dutiable property
in a statutory trust as the consequence of the making of an order under
section 66G of the Conveyancing Act 1919.
Schedule 2 [18] exempts from the payment of transfer duty the transfer or
vesting of
a liquor licence in certain circumstances under section 41, 42 or 61
of the Liquor Act 1982.
Schedule 2 [20] and [21] extend the exemption from duty on transfers
between married couples or de facto partners of their principal place of
residence.
Explanatory note page 4
Marketable securities--on-market transfers (Broker provisions)
Schedule 2 [23] imposes duty on an on-market sale or purchase of
marketable securities when it is put into SEATS in New South Wales if the
order for the sale or purchase was not previously received in another
Australian jurisdiction.
Schedule 2 [26] seeks to clarify the liability to payment of the concessional
duty on sales or purchases of marketable securities by a broker on behalf of
another broker who is engaged in principal trading.
Hire of goods
Schedule 2 [27] clarifies the meaning of duty-free threshold in relation to the
hire of goods.
Mortgages
Schedule 2 [28] and [29] seek to clarify the time at which liability for
mortgage duty arises in respect of certain mortgages.
Schedule 2 [30] clarifies an exemption from the payment of mortgage duty
and provides an exemption for mortgages taken by the clearing houses of the
Sydney Futures Exchange and the Australian Options Market that do not
secure an advance.
Schedule 2 [31] and [32] make it clear that certain debentures and related
instruments are only exempt from mortgage duty to the extent to which they
secure particular debenture issues.
General exemptions from duty
Schedule 2 [33]-[35] and [39] (the definition of public hospital) clarify the
circumstances in which charitable institutions. public hospitals and corporate
reconstructions are exempt from payment of duty.
Miscellaneous amendments
Schedule 2 [11]. [ 19]. [22]. [25] and [40] update references to various
provisions of the Corporations Law.
Schedule 2 [36] replaces references to the marking of instruments by the
Chief Commissioner with references to the stamping of the instruments.
Schedule 2 [37] enables the making of regulations of a savings and
transitional nature as a consequence of the enactment of the proposed Act.
Explanatory note page 5
Schedule 2 [38] and [41] make minor amendments to the definitions of
associated person and related person in the Dictionary with respect to public
unit trust schemes.
Schedule 2 [42] makes it clear that the transfer of a convertible note is
exempt from duty.
Schedule 3
Amendment of band Tax Act 1956
Land tax liability of certain corporations
Schedule 3 omits section 5 of the Land Tax Act 1956. That section currently
gives a land tax concession to certain corporations by allowing land tax to be
calculated in relation to each parcel of land owned by them that is subject to
taxation as if it were the only land owned.
Schedule 4
Amendment of Land Tax Management Act
1956
Certain land tax concessions to continue for limited period on
death of owner of land
Section 9C of the Land Tax Management Act 1956 allows a reduction in land
tax where land that is used for more than one purpose has the owner's
principal place of residence situated on it. Schedule 4 amends section 10A of
that Act to ensure that the concession continues to apply for a limited period
on the death of the owner.
Schedule 5
Amendment of Legal Profession Act 1987
Disclosure of information to Chief Commissioner of State
Revenue
Schedule 5 enables the Legal Services Commissioner or a member of the
Law Society Council to disclose information obtained in the administration
of Part 10 (Complaints and discipline) of the Legal Profession Act 1987 to
the Chief Commissioner of State Revenue.
Schedule 6
Amendment of Pay-roll Tax Act 1971
Employment agents
The Pay-roll Tax Act 1971 is amended by Schedule 6 [2] and [3] to make
employment agents. instead of the end-user. liable for pay-roll tax in respect
Explanatory note page 6
of employment agency contracts. not being contracts of employment. An
employment agent is not liable for pay-roll tax if:
the contract worker is liable for pay-roll tax in respect of the wages
paid for provision of the services. or
·
the wages paid to the contract worker would be exempt from pay-roll
tax if they had been paid to the contract worker by the end-user of the
services. or
the end-user of the services is not liable to pay pay-roll tax.
Grouping provisions
Schedule 6 [8]-[13]:
·
amend the ownership/control test for grouping of commonly owned or
controlled businesses to remove the application of the grouping
provisions to 50/50 joint ventures and other arrangements where there
is no more than 50% common ownership or control of a business, and
·
remove the Chief Commissioner's discretion to exclude a member who
is grouped if the grouping occurs due to more than 50% common
ownership or control.
Exemptions from pay-roll tax
Schedule 6 [4] and [5] exempt wages paid by the Home Care Service from
pay-roll tax.
Other amendments
Schedule 6 [ l ] makes a minor amendment in relation to the liability to
pay-roll tax. as wages. of certain superannuation benefits.
Schedule 6 [6] updates an out-of-date reference.
Schedule 6 [7] exempts from pay-roll tax:
·
wages (not including wages for recreation leave, annual leave, long
service leave or sick leave) paid to State Emergency Service volunteers
while taking part in provoiding emergency assistance under the State
Emergency and Rescue Management Act 1989. and
Explanatory note page 7
·
wages that would be exempt from the payment of income tax by an
employee under section 23 (z) of the Commonwealth Income Tax
Assessment Act 1936 (certain income derived by way of scholarship or
other educational assistance by a full-time student at a tertiary
educational institution).
Schedule 6 [14] and [15] contain savings and transitional provisions arising
from the amendments to the Pay-roll Tax Act 1971.
Schedule 7
Amendment of Stamp Duties Act 1920
Exemption of certain receipts from financial institutions duty
Schedule 7 [1] and [4]-[8] exempt from the payment of duty certain receipts
in respect of accounts used by financial institutions solely for the purposes of
clearing payments.
Schedule 7 [2] converts a reference to a bank cheque to a cheque that a
financial institution draws on itself as a consequence of recent amendments
to the Commonwealth Cheques and Payment Orders Act 1986 that enable a
financial institution to issue cheques.
Schedule 7 [3] exempts from the payment of duty a receipt to a farm
management deposit as a result of the transfer by the Commonwealth
Department of Primary Industry and Energy of an amount held in an income
equalisation deposit or a farm management bond.
Abolition of liability to pay death duty
Schedule 7 [10] and [11] abolish existing liabilities to pay death duties.
Savings and transitional provisions
Schedule 7 [9] enables the making of regulations of a savings and
transitional nature as a consequence of the enactment of the proposed Act.
Schedule 8 Amendment of Taxation
Administration Act
1996
Disclosure of information by tax officers to certain persons
Schedule 8 [l] enables a tax officer to disclose information obtained in the
administration of the Taxation Administration Act 1996 to the Legal Services
Commissioner. a member of the Law Society Council or a trust account
inspector or investigator appointed under the Legal Profession Act 1987 to
investigate the affairs of a solicitor.
Explanatory note page 8
Objections to Chief Commissioner of State Revenue
Schedule 8 [2] provides that a decision of the Chief Commissioner against
which an objection may be lodged to the Chief Commissioner does not
include a determination by the Chief Commissioner of an objection.
Explanatory note page 9