Page 168 - Week 01 - Wednesday, 17 February 1993
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a licensee's sales. Old licensees will be required to join the new licensees in the advance scheme. This will mean that licence fees paid on 17 March for the right to trade during the April to June 1993 quarter will be based on purchases during the October to December 1992 quarter.
Under the new legislation, the termination fees will no longer be payable when licensees cease to trade or transfer their licences. The decision to exclude the termination fee from the current scheme has been prompted by several factors: First, a termination fee is incompatible with a scheme requiring a fee to be paid for the right to trade in a coming quarter. Secondly, a termination fee by definition is payable only when a licensee ceases to trade. In most cases, licences are held by clubs or corporate licensees which pay over 90 per cent of the liquor tax each year. In other words, these licences are held by licensees which can hold those licences in perpetuity. The impact, therefore, is highly selective and discriminates against the small licensees who are natural persons. Thirdly, following the High Court decision, the continued reliance on such a provision is dubious.
However, to avoid the possibility of old licensees seeking to take advantage of the simultaneous repeal of the termination provisions and establishment of an advance payment scheme so as to avoid payments of tax due for the January to March 1993 quarter, the repeal of the termination provisions in the Liquor Tax Act will be delayed until 1 July 1993. This will provide a strong financial incentive for all old licensees to change over to the new arrangements.
It is the Government's intention to debate next week the Bills dealing with the liquor and X video franchise schemes and stamp duty on motor vehicles. The passage of this Bill is critical to the introduction of the differential tax arrangements for high and low alcohol products from 1 April 1993. As previously outlined, the introduction of new rates can occur only when all liquor traders are licensed under a single licensing scheme. That scheme will come into effect only with the passage of and assent to this Bill. Timing is critical, and I would remind members that the next sittings are scheduled for 23 March to 1 April 1993, which would not allow sufficient time to implement the necessary changes. It would also create uncertainty and possible additional administrative burden on licensees who are required on 17 March to make their next payment under the Liquor Tax Act to enable them to trade during the April to June quarter.
There is also an impact on the revenue in any delay in the implementation of the differential tax schemes. A delay in the introduction of the new higher rate for alcoholic beverages beyond 1 April 1993 will result in a revenue loss of approximately $300,000 this financial year. I believe that the Government has taken the prudent course of action in delaying the introduction of the differential rates until consideration has been given to the findings of the High Court. The current sittings are the first opportunity the Government has had to bring forward amendments and I would ask members to recognise this fact and debate this Bill next week. Because the X video Bill and the Stamp Duties and Taxes (Amendment) Bill also deal with amendments as a consequence of the High Court decision, I ask that members agree that there is considerable benefit in considering these Bills cognately. I now present the explanatory memorandum for the Bill.
Debate (on motion by Mr De Domenico) adjourned.
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