The Victorian Civil and Administrative Tribunal has affirmed a stamp duty assessment of a taxpayer in relation to an acquisition of shares in 2 “land rich companies”.
The background facts are complex. Broadly, the matter concerned the taxpayer’s acquisition on 25 June 2004 of the shares in the land rich companies. Before the Tribunal, the taxpayer submitted that ultimate indirect ownership and control of the 2 companies remained in the sole ownership of one individual before and after the transaction in question, and that there was no change in beneficial ownership and therefore no transfer that could be regarded as a dutiable transaction. It was submitted the Commissioner should determine favourably his discretion under s 85(2) of the Duties Act 2000 (Vic) that the acquisition was an exempt acquisition as application of the Duties Act would “not be just and reasonable”.
The Tribunal referred to its decision in STIC Australia Pty Ltd v Comr of State Revenue [2010] VCAT 1057. In that case, the Tribunal had applied favourably the s 85(2) discretion. However, the Tribunal noted there was a “vast difference” between STIC and this case which included the lack of change in beneficial ownership and the level of disclosure, and accordingly, it affirmed the assessment.
However, the Tribunal ordered the penalty tax and the premium component of the interest to be remitted as it concluded the taxpayer had taken “reasonable care”.
(Loyalty Connection Pty Ltd v Comr of State Revenue (Taxation) [2011] VCAT 2422, Victorian Civil and Administrative Tribunal, Macnamara DP, 8 December 2011.)
[LTN 25, 8/2]