Page 1411 - Week 06 - Tuesday, 11 August 1992
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the Treasurer: If the Government acknowledges that the case of the family home being owned by a family company is, in fact, an anomaly and should not be caught by land tax, why will she not grant this case a permanent exemption from land tax, rather than the temporary amnesty on stamp duty which she has announced in this paper?
MS FOLLETT: Madam Speaker, I thank Mr Humphries for the question and I am only too happy to respond to it. It is indeed the case that we have decided to allow a property which is owned by a company to be transferred into the names of shareholders without attracting stamp duty, and this is, in fact, a one-off amnesty to allow people to rearrange their affairs if that is their wish. That arrangement now means that people who were caught unawares by the extension of the land tax to residential properties have a chance to get their affairs in order and rearrange them. If people do not wish to take advantage of this amnesty, then we can only conclude that the company arrangement has some other advantages to them which outweigh the cost of paying land tax.
Mr Humphries has asked why we do not make that an ongoing situation. Clearly, there are a number of reasons why we are providing a one-off amnesty. There is a clear intent in the extension of the land tax to make commercial properties, whether they are residential in nature or of some other commercial nature, pay land tax. That is the clear intention of the legislation and, Madam Speaker, I think that it would be to defy the intention of the legislation to allow the kind of ongoing exemption that Mr Humphries has spoken of. It would also, of course, clearly be a cost to the rest of the community if there were to be a permanent exemption from stamp duty on these kinds of transfers.
Madam Speaker, as I say, it is the Government's intention to allow people this opportunity to rearrange their affairs if they wish. Not all people will wish to do so. Some of them may have company arrangements which are perfectly satisfactory to them and for which the benefits would outweigh the benefit of not being liable for land tax. There is also the question of capital gains tax. If people transfer properties in this way they may become liable for capital gains tax. Again, that is not an ACT tax; it is a Federal tax. But people need to weigh up their own particular circumstances to decide whether they want to take this action.
I think the one-off amnesty is a more than fair outcome; it is certainly an outcome that is designed particularly to help people who may not have been aware that they would be liable for land tax under this new arrangement. I think, Madam Speaker, it is a perfectly reasonable action for the Government to take, and I also think it is perfectly reasonable to make it clear that this will not be a continuing exemption from land tax and that people have a one-off chance to rearrange their affairs.
MR HUMPHRIES: I ask a supplementary question, Madam Speaker. In the future, in cases where family companies hold family homes and those companies can demonstrate quite clearly that they are not commercial arrangements but are purely arrangements to hold a family home, will there be some ongoing arrangement for an exemption from land tax on the same basis that the Minister has made other permanent exemptions from land tax available in this statement?
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