On 26 October 2017, the Revenue Legislation Amendment Bill 2017 (No 2) was introduced in the ACT Legislative Assembly.
It proposes a range of amendments including:
- Amendment of the Duties Act 1999 to clarify that if a dutiable transaction is not registered, the Commissioner has the power to make an assessment of duty liability under s 7 of the Taxation Administration Act 1999 (TAA). Under the ACT’s new ‘Barrier Free’ model (which is applicable from 18 September 2017), duty only becomes payable after a property transfer is registered with the Registrar‐General ie duty is no longer paid before settlement. To ensure that all transfers are presented for tax assessment, s 47C (3) of the Land Titles Act 1925 requires all transferees to lodge transfers within 14 days after the day of settlement. If lodgment for registration is postponed or avoided indefinitely, in breach of s 47C (3), duty does not become payable. However, the transferee will continue to have a liability for duty. Under this circumstance, the Commissioner would be able to use his or her general power of assessment under the TAA to assess the duty liability of the transferee based on all information available at hand. However, the Duties Act does not explicitly state that the Commissioner has this function. The amendment clarifies this.
- The Bill proposes clarification on dutiable transactions that will not be processed under the Barrier Free model. The Revenue Legislation Amendment Act 2017 provided declarations of trust and grants of a commercial lease with premium would be processed following the Barrier Free administrative procedures, where liability of duty becomes payable at title registration and must be paid within the following 14 days. However, the ACT Revenue Office has determined that the Barrier Free rules will not be applicable to declarations of trust and grants of a commercial lease with premium due to the nature of these transactions.
- The Bill aligns the processes of payment of duty for declarations of trust and grants of a commercial lease with premium with non‐Barrier Free transactions where the 90 day period for lodgment and payment applies.
- The Bill also clarifies that, for grants of a commercial lease with premium, duty becomes payable when the lease is granted, not when it is registered.
- The Bill would amend the Duties Act to clarify that the duty rate for relevant acquisitions in landholders are determined independently of the rate for transfer of dutiable property. The Bill seeks to reinforce the determination of the Taxation Administration (Amounts Payable – Duty) Determination 2017 (No 1) in which the commercial rate of duty applies to landholder transactions.
- For payroll tax purposes, the Bill proposes to amend the definition of “exempt rate” to be the same as NSW legislation. The amendments reflect the Commonwealth’s decisions in 2015 to provide a single rate of deduction for calculating work‐related car expenses, regardless of the engine capacity, and to set the exempt rate by legislative instrument rather than by regulation.
[ACT Government website: Bill Tracker, Bill, Explanatory Statement; LTN 208, 31/10/17 (per EM); TM Oct 2017]