MR HUMPHRIES (continuing):

Currently, the Duties Act imposes duty on leases based on the lease cost, that is, rent payable under the lease, plus certain other specific payments. For long term leases over 30 years, the rate of duty is currently imposed at the same rate as that applying to a transfer of a Crown Lease. This is to discourage the use of long term leases as a pseudo transfer of the Crown Lease.

However, there have been several cases of long-term leases where the lease cost was significantly less than the value of the Crown Lease. This has resulted in the revenue collected being significantly less than that which would be payable if the land itself had been transferred. To overcome this, the Bill will amend the Duties Act to impose duty on long term leases based on the greater of the cost of the lease or the unencumbered value of the Crown Lease.

In addition, to prevent leases less than 30 years being issued at nominal cost to reduce duty liability, they will now be assessed on the greater of the cost or value of the lease. These changes will not apply to franchise arrangements.

Mr Speaker, under the Taxation Administration Act 1999 (Taxation Administration Act) the Commissioner for ACT Revenue may appoint agents to facilitate the lodgement of documents and payments of tax. Approved agents of the Commissioner will be able to process simple documents and pay the assessed duty by monthly return. Transactions agents may be given approval for include conveyances, leases, licenses and franchise agreements between unrelated parties. Many of these transactions currently incur $20 duty to cover processing costs.

Mr Speaker, this Bill will amend the Duties Act so that, where an approval is granted by the Commissioner in accordance with the Taxation Administration Act, and duty is collected by an approved agent, the taxpayer will not be required to pay the concessional duty of $20. Where the ad valorem duty is less than $20, the ad valorem duty will apply.

Mr Speaker, the vesting of property by court order or statute has, in many instances, circumvented the Duties Act and avoided the payment of duty that would have been paid had the property been transferred. To stop the vesting of property being used as a means of avoiding duty, this Bill expands the meaning of 'transfer' to include vesting, whether by statute or court order. This only applies to the vesting of an existing interest in property, and not to the creation of a new interest.

Mr Speaker, the Commonwealth's Financial Sector (Transfers of Business) Act 1999 (Financial Sector Act) provides for the transfer of assets and liabilities between Authorised Deposit-taking Institutions (ADIs) and is administered by the Australian Prudential Regulation Authority (APRA). ADIs are specified by the Commonwealth's Banking Act 1959 and can be banks, credit unions, insurance companies, superannuation funds etc. Transfers of assets and liabilities can be voluntary or compulsory, and total or partial. Section 22 of the Financial Sector Act allows the transfer of assets and liabilities from one ADI to a receiving body ADI 'without any transfer, conveyance or assignment'. The effect of this provision is that duty cannot be assessed on the transaction.

Mr Speaker, this Bill will amend the Duties Act to require receiving bodies, to whom property is voluntarily transferred under the Financial Sector Act, to lodge a statement with the Commissioner. Duty will be payable based on the value of