Page 3006 - Week 09 - Thursday, 21 September 2006
Next page . . . . Previous page . . . . Speeches . . . . Contents . . . . Debates(HTML) . . . . PDF . . . .
Tasmania has already abolished hiring duty, and Victoria, Queensland and Western Australia will do so on 1 January 2007. Along with the ACT, the Northern Territory and New South Wales will abolish hiring duty on 1 July 2007, and South Australia will commence abolition in three stages, from July 2007.
The hiring duty payable is usually incorporated into the hiring charge. Even though it is the commercial hiring business that is liable to the duty, the hirer effectively reimburses the hiring business. I am not in a position to compel them to do so, but I would hope that, when they are no longer required to pay the duty, commercial hiring businesses will deduct from their charges any amount that covers the reimbursement of hiring duty. To limit any windfall gain to a commercial hiring business, the Revenue Office will advertise in the local and national media to ensure that hirers are aware of the abolition of hiring duty in the ACT on 1 July 2007.
The second tax abolished by this bill is lease duty, which is imposed on lease instruments on the total cost of the lease, through chapter 5 of the Duties Act. This bill proposes to cease all duty on leases executed after 30 June 2009. However, continuing current practice, and in line with the approach adopted by other jurisdictions to protect the land revenue base, duty at conveyance rates will be retained on long-term leases and franchise arrangements longer than 30 years as they are considered, for anti-avoidance purposes, to be equivalent to a conveyance of land. To implement this and to allow for the expiry of chapter 5 of the Duties Act on 30 June 2009, long-term leases and franchise arrangements will become dutiable property under chapter 2 of the Duties Act.
To ensure consistent and equal treatment for all lessors, any lease first executed before 1 July 2009 will be liable to duty on the full cost or value for its full term and there will be no pro rata refunds for any period of the lease that continues beyond the abolition date. Where duty has been based on the estimated cost of a lease it is followed by periodic estimates and possible payment of further duty. The transitional provisions will provide for a final estimate to be made at the earliest opportunity after 1 July 2009. The final estimate will be taken to be the full cost of the lease. This ensures that all outstanding lease duty obligations can be resolved as early as possible after the abolition date.
Most jurisdictions have already abolished lease duty. The Northern Territory will follow suit in July 2007, and New South Wales in January 2008. The ACT will be the last jurisdiction to do so, in July 2009.
The final tax to be abolished by this bill is duty on unquoted marketable securities on all transactions made after 30 June 2010. As duty on marketable securities quoted on a stock exchange was abolished in 2001, this now allows for the expiry of provisions relating to duty on the transfer of shares and units in a unit trust scheme. This includes provisions relating to the rate of duty, exemptions, concessions and registration requirements. The associated anti-avoidance measures in chapter 3 that capture alterations of rights and the allotment of shares by direction will also expire on 30 June 2010.
The abolition dates for those jurisdictions currently imposing duty on unquoted marketable securities are: Queensland, in January 2007; New South Wales, in January 2009; South Australia, in two stages, from July 2009 to July 2010; and the ACT,
Next page . . . . Previous page . . . . Speeches . . . . Contents . . . . Debates(HTML) . . . . PDF . . . .