Page 4020 - Week 13 - Thursday, 6 December 2007
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to include as wages paid in the ACT, a share, or the option to acquire a share, in a local company. In any other case, they are taken to be paid outside the ACT and are only subject to ACT payroll tax if the grant is made for services performed wholly in the ACT.
Mr Speaker, the other issues covered by this bill are motor vehicle allowances, accommodation allowances, a range of fringe benefits, work performed outside a jurisdiction and grouping of businesses. In addition to these measures agreed by the national project, New South Wales and Victoria implemented a bilateral project that resulted in both states adopting new payroll tax acts on 1 July 2007. These acts are based on the same template with a separate schedule dealing with jurisdiction specific provisions—that is, provisions where they chose to maintain their differences, including different rates and thresholds. The new acts cover the eight areas of concern from the national project and several additional matters. In some cases both states made changes, and in other cases they adopted each other’s provisions to provide a new act. The result of this exercise is that New South Wales and Victoria now have new, virtually identical payroll tax acts.
The ACT already complies with some of the bilateral project provisions such as no liability for portable long service leave and redundancy schemes, and the inclusion as wages of termination payments to non-employee directors and deemed employees. In the case of exemptions for wages paid for maternity or adoption leave, the ACT provisions extend further than New South Wales and Victoria by including an exemption for wages paid to a primary carer taking such leave. There is no intention for the ACT to harmonise in this case, as our exemption provides a benefit in relation to a wider range of people.
The possible adoption of other bilateral project measures is being investigated with a proposed commencement date of 1 July 2009 for any further harmonisation. This includes the treatment of employment agents and exemptions for apprentices. New South Wales and Victoria have also limited the exemption for wages paid by non-profit organisations to cases where the entity’s objects are wholly charitable, benevolent, philanthropic or patriotic, and the person is engaged exclusively in that kind of work. All other wages paid by the non-profit organisation are taxable.
Any further consistency measures will only be proposed if they are in the best interests of the ACT. If further measures are to be adopted, the feasibility of the ACT adopting the New South Wales and Victorian payroll tax acts as a model for a new ACT Payroll Tax Act will be investigated.
Mr Speaker, I will now give a brief outline of the measures covered in this bill, all of which are consistent with the New South Wales and Victorian new payroll tax acts. Exemptions for motor vehicle allowances and accommodation allowances in the ACT are currently dealt with administratively and their value has not changed for some years. This type of exemption easily lends itself to a consistent approach by all jurisdictions. The bill adopts exemption rates linked with those set annually by the Australian Taxation Office for income tax deduction purposes. The motor vehicle allowance exemption will be linked to the large car rate, and the value of the accommodation allowance exemption will be linked to the lowest salary band/lowest capital city rate.
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