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Legislative Assembly for the ACT: 1998 Week 11 Hansard (10 December) . . Page.. 3428 ..

MS CARNELL (continuing):

The expanded list of dutiable transactions includes declarations of trust, the surrender of dutiable property and the vesting of property by statute or court order. Also of significance is the emphasis on "transaction" compared with the emphasis under the current Stamp Duties and Taxes Act on "documents".

Liability for duty also arises differently under the Duties Bill in respect of transfers of dutiable property, compared with the current Act. Under the current Act, in all but a small number of areas duty is document based and liability arises when documents are executed. Under the new Bill, it is a transaction rather than a document that is liable for duty and the important date is the date that the transaction occurred. Duty is therefore not dependent upon the execution of a document, which overcomes one of the ways duty could be avoided or deferred in the past.

The Bill also adopts the approach of clearly defining what property is to be charged with duty by providing a comprehensive property list, including a limited list of business assets. This approach differs from the current Act, which imposes duty on the sale of businesses without specifically listing the assets to be brought to duty.

Other property transfers subject to duty for the first time under the Duties Bill include a new form of marketable security traded on the Australian Stock Exchange called an instalment warrant, and the transfer of options to purchase crown leases.

A number of new concessions have been provided to duty payers. Under the Duties Bill, where an agreement to purchase a crown lease is in the name of one person, and subsequently the memorandum of transfer is in the name of his or her family company or trust, additional duty of only $20 will be imposed, instead of further ad valorem duty as is currently the case. This concession addresses many concerns by taxpayers about the current treatment of such transactions.

The Bill also exempts from duty transactions arising from a public company buying back its own shares, as well as eligible corporate restructures. Guidelines to provide exemptions for corporate restructures will be set by the Treasurer in the form of a disallowable instrument. This approach provides a clear message that the ACT is supportive of companies incorporated in the ACT taking measures to achieve corporate efficiency and to enhance competitiveness.

Mr Speaker, under the current law, transfers of shares and units in ACT private companies and private unit trusts which own land in the ACT are subject to duty at conveyance rates on the underlying value of the land. These provisions were introduced to overcome an avenue of stamp duty minimisation based on the difference between conveyance rates, which range from 1.5 per cent to 5.5 per cent, and the marketable security rate of 0.6 per cent. Duty at conveyance rates could be avoided by transferring land ownership through the sale and purchase of shares in the land-owning company or trust.

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