State Taxation Acts (Miscellaneous Amendments) Act 2003

i State Taxation Acts (Miscellaneous Amendments) Act 2003 Act No. 58/2003 TABLE OF PROVISIONS Section Page PART 1—PRELIMINARY 1 1. Purpose 1 2. Commencement 2 PART 2—DUTIES ACT 2000 3 3. Definitions 3 4. Transactions concerning dutiable property 3 5. Dutiable property 4 6. Dutiable value includes GST 4 7. Aggregation of certain dutiable transactions 5 8. Sub sales of land 5 9. Apparent purchasers, trustees and nominees 5 10. Exemption from duty—domestic relationships 6 11. Transfers to trustees or custodians of superannuation funds or trusts 6 12. Transfer of farms to relatives or charities 6 13. Land-rich private corporations 6 14. Insurance premiums include GST 7 15. Refunds where insurance premiums are returned 8 16. Motor vehicle duty 8 17. Dutiable value of motor vehicles includes GST 9 18. Transitional provisions—GST 9 PART 3—PAY-ROLL TAX ACT 1971 11 19. Grouping provisions 11 20. Phased abolition of exemption for apprentices' wages 12 ═══════════════ ENDNOTES 13 -- 1 of 14 -- 1 State Taxation Acts (Miscellaneous Amendments) Act 2003 † [Assented to 16 June 2003] The Parliament of Victoria enacts as follows: PART 1—PRELIMINARY 1. Purpose The purpose of this Act is to make miscellaneous amendments to the Duties Act 2000 and the Pay- roll Tax Act 1971. Victoria No. 58 of 2003 -- 2 of 14 -- Part 1—Preliminary State Taxation Acts (Miscellaneous Amendments) Act 2003 Act No. 58/2003 2 2. Commencement (1) This Act (except sections 4, 6, 13(2), 14, 16, 17 and 20) comes into operation on the day after the day on which it receives the Royal Assent. (2) Sections 6, 13(2), 14 and 17 are deemed to have come into operation on 1 July 2001. (3) Section 4 is deemed to have come into operation on 8 February 2003. (4) Section 20(1) and (2) is deemed to have come into operation on 7 May 2003. (5) Section 16 comes into operation on 1 July 2003. (6) Section 20(3) comes into operation on 1 January 2004. __________________ s. 2 -- 3 of 14 -- Part 2—Duties Act 2000 State Taxation Acts (Miscellaneous Amendments) Act 2003 Act No. 58/2003 3 PART 2—DUTIES ACT 2000 3. Definitions In section 3(1) of the Duties Act 2000— (a) in the definition of "primary production"— (i) in paragraph (a), after "cultivation" (where secondly occurring) insert "(whether in a natural, processed or converted state)"; (ii) in paragraph (e), after "propagation" insert "for sale"; (b) in the definition of "related person", after paragraph (e) insert— "(f) persons are related persons for the purposes of Chapter 3 if they (whether jointly or separately) acquire interests in a private corporation and the acquisitions form, evidence, give effect to or arise from substantially one transaction or one series of transactions;". 4. Transactions concerning dutiable property (1) For section 7(1)(b)(vi) of the Duties Act 2000 substitute— "(vi) any other transaction that results in a change in beneficial ownership of dutiable property (other than an excluded transaction).". (2) After section 7(2) of the Duties Act 2000 insert— "(2A) Despite sub-section (1)(b)(vi), an excluded transaction that results in a change in beneficial ownership of dutiable property is a dutiable transaction if it is part of a scheme or arrangement that, in the Commissioner's s. 3 See: Act No. 79/2000. Reprint No. 2 as at 1 July 2002. LawToday: www.dms. dpc.vic. gov.au -- 4 of 14 -- Part 2—Duties Act 2000 State Taxation Acts (Miscellaneous Amendments) Act 2003 Act No. 58/2003 4 opinion, was made with a collateral purpose of reducing the duty otherwise chargeable under this Chapter.". (3) In section 7(4) of the Duties Act 2000, after the definition of "declaration of trust" insert— ' "excluded transaction" means— (a) the purchase, gift, allotment or transfer of any unit in a unit trust scheme; or (b) the variation, abrogation or alteration of a right attaching to any such unit; or (c) the redemption, surrendering or cancellation of any such unit; or (d) the variation or alteration of a right of a holder of any such unit; or (e) any combination of the transactions referred to in paragraphs (a), (b), (c) or (d).'. 5. Dutiable property (1) After section 10(1)(a)(i) of the Duties Act 2000 insert— "(ia) a life estate; (ib) an estate in remainder;". (2) In section 10(1)(d)(iv) of the Duties Act 2000, for "land used for primary production" substitute "primary production". 6. Dutiable value includes GST At the end of section 20 of the Duties Act 2000 insert— "(2) In determining the dutiable value of dutiable property, there is to be no discount for the amount of GST (if any) payable on the supply of that property.". s. 5 -- 5 of 14 -- Part 2—Duties Act 2000 State Taxation Acts (Miscellaneous Amendments) Act 2003 Act No. 58/2003 5 7. Aggregation of certain dutiable transactions In section 24(2A)(a)(i) of the Duties Act 2000, after "1958" insert "(not being a partial interest in a parcel of land)". 8. Sub sales of land In section 31(3) of the Duties Act 2000— (a) in paragraph (b), after "entered into" insert "and is still a director of the body corporate at the time of the transfer"; (b) in paragraph (d), after "entered into" insert "and is still a related body corporate of the transferee at the time of the transfer". 9. Apparent purchasers, trustees and nominees (1) After section 34(2) of the Duties Act 2000 insert— "(3) This section applies whether or not there has been a change in the legal description of the dutiable property or marketable securities. Example An example of a change in the legal description of dutiable property is the issuing of new certificates of title of land following a subdivision of the land.". (2) After section 35(2) of the Duties Act 2000 insert— "(3) This section applies whether or not there has been a change in the legal description of the dutiable property or marketable securities. Example An example of a change in the legal description of dutiable property is the issuing of new certificates of title of land following a subdivision of the land.". s. 7 -- 6 of 14 -- Part 2—Duties Act 2000 State Taxation Acts (Miscellaneous Amendments) Act 2003 Act No. 58/2003 6 10. Exemption from duty—domestic relationships In section 38(2) of the Duties Act 2000, after "marriage" (wherever occurring) insert "or domestic relationship". 11. Transfers to trustees or custodians of superannuation funds or trusts In section 41(1) of the Duties Act 2000, after "dutiable property" insert "made without monetary consideration". 12. Transfer of farms to relatives or charities In section 56(1)(a) of the Duties Act 2000, after "fee simple" insert ", life estate or estate in remainder". 13. Land-rich private corporations (1) For section 72(2) of the Duties Act 2000 substitute— "(2) In calculating the unencumbered value of the property of a private corporation for the purposes of this section, property of any of the following kinds is not counted— (a) cash, whether in Australian or other currency; (b) money on deposit with an authorised deposit-taking institution (within the meaning of the Banking Act 1959 of the Commonwealth), negotiable instruments or debt securities; (c) loans that, according to their terms, are to be repaid on demand by the lender or within 12 months after the date of the loan; s. 10 -- 7 of 14 -- Part 2—Duties Act 2000 State Taxation Acts (Miscellaneous Amendments) Act 2003 Act No. 58/2003 7 (d) if the private corporation is a private company, loans to persons who, in relation to the company or to a majority shareholder or director of the company, are associated persons; (e) if the private corporation is a private unit trust scheme, loans to persons who, in relation to a trustee or beneficiary of the scheme, are associated persons; (f) prescribed property, unless the Commissioner, being satisfied that the property concerned was not acquired solely or mainly for the purpose of avoiding duty under this Part, notifies the private corporation that the property will be counted for the purposes of such a calculation; (g) the private corporation's shareholding or interest in a subsidiary of the private corporation. Note: Section 74 defines a subsidiary of a private corporation.". (2) In section 76(3)(a) of the Duties Act 2000, for "private company" substitute "private corporation". 14. Insurance premiums include GST After section 177(2) of the Duties Act 2000 insert— '(2A) "Premium" also includes any amount in respect of GST on the supply to which the insurance relates.'. s. 14 -- 8 of 14 -- Part 2—Duties Act 2000 State Taxation Acts (Miscellaneous Amendments) Act 2003 Act No. 58/2003 8 15. Refunds where insurance premiums are returned After section 183(3) of the Duties Act 2000 insert— "(4) As an alternative to applying for a refund under Part 4 of the Taxation Administration Act 1997, a general insurer may offset an amount equivalent to the amount of refund to which the insurer is entitled under sub-section (1) against any other payment required to be made under this Act by the insurer. (5) Sub-section (4) only applies if the general insurer— (a) has not charged to, or recovered from, any other person any amount in respect of the whole or any part of the duty to which the general insurer is entitled to a refund; or (b) has refunded or reimbursed each person for the amount charged to or recovered from that person in respect of the duty to which the general insurer is entitled to a refund. (6) Sub-sections (4) and (5) apply despite anything to the contrary in section 18(2) of the Taxation Administration Act 1997.". 16. Motor vehicle duty At the end of section 218 of the Duties Act 2000 insert— "(2) If— (a) an application for registration or transfer of registration of a motor vehicle is made by a person who has a physical disability; and s. 15 -- 9 of 14 -- Part 2—Duties Act 2000 State Taxation Acts (Miscellaneous Amendments) Act 2003 Act No. 58/2003 9 (b) the motor vehicle is modified to enable the person to drive the vehicle— the amount of duty is to be reduced by the reasonable cost of the modification of the vehicle. (3) If the reasonable cost of the modification of a motor vehicle referred to in sub-section (2) is greater than the amount of duty chargeable (but for that sub-section) on an application for registration or transfer of registration of the vehicle, no duty is chargeable on the application. (4) For the purposes of sub-sections (2) and (3), the reasonable cost of the modification of a motor vehicle is the lower of— (a) the actual cost of the modification; (b) the price payable in the open market for the modification.". 17. Dutiable value of motor vehicles includes GST After section 219(2) of the Duties Act 2000 insert— "(3) In determining the dutiable value of a motor vehicle, there is to be no discount for the amount of GST (if any) payable on the supply of the vehicle.". 18. Transitional provisions—GST After clause 18 in Schedule 2 to the Duties Act 2000 insert— "19. State Taxation Acts (Miscellaneous Amendments) Act 2003 (1) In ascertaining, for the purposes of the provisions of the former Act specified in sub-clause (2), the value of anything or the consideration or premium paid for anything, there is to be no discount for the amount of GST (if any) payable on the supply of that thing. s. 17 -- 10 of 14 -- Part 2—Duties Act 2000 State Taxation Acts (Miscellaneous Amendments) Act 2003 Act No. 58/2003 10 (2) The provisions of the former Act to which sub-clause (1) applies are— (a) subdivision (6) of Division 3 of Part II and Heading VI in the Third Schedule (Conveyance of Real Property and Land Transfer); (b) subdivision (8) of Division 3 of Part II and Heading VIII in the Third Schedule (Lease or Agreement for a Lease); (c) subdivision (11) of Division 3 of Part II (Insurance and Assurance Business); (d) subdivision (16) of Division 3 of Part II and Heading XXI in the Third Schedule (Motor Vehicle and Heavy Trailer Registration). (3) This clause applies, and must be taken always to have applied, from and including 1 July 2000. (4) Nothing in this clause affects the rights of the parties in the Supreme Court proceeding known as Royal & Sun Alliance Insurance Australia Ltd (ACN 007 746 092) v Commissioner of State Revenue (Vic) (No. 4415 of 2002).". __________________ s. 18 -- 11 of 14 -- Part 3—Pay-roll Tax Act 1971 State Taxation Acts (Miscellaneous Amendments) Act 2003 Act No. 58/2003 11 PART 3—PAY-ROLL TAX ACT 1971 19. Grouping provisions (1) For section 9A(1A)(b), (c) and (d) of the Pay-roll Tax Act 1971 substitute— '(b) one or more employees of an employer perform duties for or in connection with one or more businesses carried on by the employer and one or more other persons ("associates"); or (c) one or more employees of an employer are employed solely or mainly to perform duties for or in connection with one or more businesses carried on by one or more other persons ("associates"); or (d) one or more employees of an employer perform duties for or in connection with one or more businesses carried on by one or more other persons ("associates"), being duties performed in connection with, or in fulfilment of the employer's obligation under, an agreement, arrangement or undertaking for the provision of services to any one or more of the associates in connection with that business or those businesses— (i) whether the agreement, arrangement or undertaking is formal or informal, express or implied; and (ii) whether or not the agreement, arrangement or undertaking provides for duties to be performed by the employees or specifies the duties to be performed by them—'. s. 19 See: Act No. 8154. Reprint No. 9 as at 1 July 2002. LawToday: www.dms. dpc.vic. gov.au -- 12 of 14 -- Part 3—Pay-roll Tax Act 1971 State Taxation Acts (Miscellaneous Amendments) Act 2003 Act No. 58/2003 12 (2) At the foot of section 9A(1A) of the Pay-roll Tax Act 1971 insert— "Note: Sub-section (1J) allows the Commissioner to exclude members from a group constituted under this sub- section in certain circumstances.". (3) At the foot of section 9A(1B) of the Pay-roll Tax Act 1971 insert— "Note: Sub-section (1J) allows the Commissioner to exclude members from a group constituted under this sub- section in certain circumstances.". (4) At the foot of section 9A(2) of the Pay-roll Tax Act 1971 insert— "Note: Sub-section (1J) allows the Commissioner to exclude members from a group constituted under this sub- section in certain circumstances.". 20. Phased abolition of exemption for apprentices' wages (1) At the foot of section 10(1)(k) of the Pay-roll Tax Act 1971 insert— "Note: This exemption does not apply to wages paid or payable on or after 1 July 2003 under training agreements made on or after 7 May 2003— see sub-section (4).". (2) After section 10(3) of the Pay-roll Tax Act 1971 insert— "(4) Sub-section (1)(k) does not apply to wages paid or payable on or after 1 July 2003 to an apprentice under a training agreement made on or after 7 May 2003.". (3) In section 10 of the Pay-roll Tax Act 1971, sub- sections (1)(k) and (4) are repealed. ═══════════════ s. 20 -- 13 of 14 -- State Taxation Acts (Miscellaneous Amendments) Act 2003 Act No. 58/2003 13 ENDNOTES † Minister's second reading speech— Legislative Assembly: 7 May 2003 Legislative Council: 10 June 2003 The long title for the Bill for this Act was "to make miscellaneous amendments to the Duties Act 2000 and the Pay-roll Tax Act 1971 and for other purposes." 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