State Tax Laws Amendment (Budget and Other Measures) Bill 2013
Introduction Print
EXPLANATORY MEMORANDUM
571405
BILL LA INTRODUCTION 7/5/2013
General
The Bill amends the Congestion Levy Act 2005 to increase the amount of the levy and extend it to short stay parking spaces in the central business district and inner Melbourne.
The Bill amends the Duties Act 2000 to—
· bring forward the introduction of the 40% duty reduction for eligible first home buyers from 1 January 2014 to 1 July 2013;
· ensure that eligible first home buyers who purchase a home for under $130 000 qualify for the first home buyer duty reduction;
· increase the threshold for the young farmers' duty exemption and concession on single title purchases;
· extend the exemption from motor vehicle duty for vehicles modified to carry incapacitated passengers to include modified vehicles registered in the name of a relative or carer of an incapacitated person;
· ensure that concessions that apply to listed companies under the landholder duty provisions extend to companies listed on the New Zealand Stock Exchange;
· make technical amendments to the landholder provisions to address administrative and technical issues.
The Bill amends the Fire Services Property Levy Act 2012 to address a number of minor administrative issues that have arisen during implementation of the fire services property levy.
The Bill amends the First Home Owner Grant Act 2000 to—
· restrict eligibility for the first home owner grant to buyers of new residential homes from 1 July 2013;
· increase the amount of the first home owner grant for buyers of new residential homes from $7000 to $10 000;
· extend the first home owner grant residence requirement from 6 months to 12 months;
· permit the disclosure of certain information obtained under the First Home Owner Grant Act 2000 to the Legal Services Board and the Legal Services Commissioner.
The Bill amends the Liquor Control Reform Act 1998 to provide for the delegation of certain powers by the Treasurer to the Commissioner of State Revenue.
The Bill amends the Payroll Tax Act 2007 to clarify the payroll tax treatment of payments made to owner-drivers and other contractors.
The Bill amends the Taxation Administration Act 1997 in relation to staffing, delegation and disclosure of information.
The Bill amends the Water Act 1989 to expressly provide for certain functions to be performed by the Commissioner of State Revenue.
Clause Notes
PART 1—PRELIMINARY
Part 1 of the Bill outlines the purposes of the Bill and contains the commencement provisions.
Clause 1 outlines the purposes of the Bill.
Clause 2 provides that the Bill, except for Part 2, sections 13 and 27 and Parts 5 and 7, will commence on the day after the Bill receives Royal Assent. Part 5 of the Bill which amends the First Home Owner Grant Act 2000 and Part 7 which amends the Payroll Tax Act 2007 come into effect on 1 July 2013. Section 13 which includes NZX Limited in the definition of listed company and listed trust in the Duties Act 2000 is taken to have come into effect on 8 May 2013, the day of the second reading speech for the Bill. The retrospective commencement date is intended to prevent the distortion of investment decisions between the date ofannouncement and the passage of the Bill. Section 27 which corrects an omission in the new landholder duty transitional provisions is taken to have come into effect on 1 July 2012 to coincide with the date on which the landholder duty regime commenced. Part 2 which amends the Congestion Levy Act 2005 commences on 1 January 2014.
PART 2—CONGESTION LEVY ACT 2005
Part 2 of the Bill amends the Congestion Levy Act 2005 to increase the amount of the levy to $1300 for each leviable parking space and extend the levy to short stay parking spaces within the central business district and inner Melbourne. These measures were announced in the 2013–14 Budget.
Clause 3 extends the purpose of the Congestion Levy Act 2005 by omitting the term "long stay" from section 1 of the Congestion Levy Act 2005. This ensures that the purpose of that Act is to impose a levy on all non-exempt parking spaces in the central business district and inner Melbourne to reduce traffic congestion.
Clause 4 Subclause (1)(a) amends section 3(1) of the Congestion Levy Act 2005 to omit the term "long stay" in the definition of leviable parking space. Subject to any exemptions, this amendment ensures that all parking spaces in a car park are leviable, regardless of whether they are set aside or used for short stay or long stay purposes.
Subclause (1)(b) amends section 3(1) of the Congestion Levy Act 2005 to repeal the definition of long stay parking space which was previously defined as having the meaning set out in section 4 of that Act. This definition is no longer required because the levy is intended to apply to all non-exempt parking spaces from 1 January 2014.
Subclause (2) repeals section 4 of the Congestion Levy Act 2005, which defined long stay parking space.
Clause 5 Subclause (1) amends section 10(3) of the Congestion Levy Act 2005 to insert the words "up to and including 2013" after "subsequent year". Section 10(3) provides that the amount of levy for 2008 and each subsequent year is the CPI adjusted levy for that year for each leviable parking space. The amount of levy in 2007 was $800 and since 2008 the levy has been CPI adjusted from the amount of the levy for the previous year. To give effect to the increase in levy amount in 2014, this amendment ensures that the levy is not CPI adjusted from the 2013 amount of $930 for the 2014 levy year.
Subclause (2) inserts a new section 10(3A) into the Congestion Levy Act 2005 to increase the amount of levy for each leviable parking space to $1300 in 2014 and inserts a new section 10(3B) to ensure that the levy amount for 2015 is CPI adjusted from the 2014 amount of $1300. Insubsequent years the levy will be adjusted from the amount that applied in the previous year. Forexample, the 2016 levy amount will be CPI adjusted from the 2015 levy amount.
Clause 6 inserts a note at the foot of section 13 of the Congestion Levy Act 2005 drawing attention to the transitional provision in section 40 which is relevant to the application of section 13 to the levy for 2014.
Clause 7 repeals sections 14 and 15 of the Congestion Levy Act 2005 which provided for the statutory ratio. As the levy was previously limited to long stay parking spaces, section 14 allowed the Commissioner of State Revenue to assume that 75% of the parking spaces in a public car park were used as long stay parking spaces at any time in the year prior to the levy year and the remaining 25% were short stay parking spaces. Section 15 allowed the Commissioner of State Revenue to approve a lower ratio if the public car park had a lower incidence of long stay parking. These provisions are now redundant as both short stay and long stay parking spaces will be leviable from 2014.
Clause 8 Subclause (1) amends section 16(1) and 17(1) of the Congestion Levy Act 2005 by omitting the words "set aside or". This will ensure that the exemptions which apply to residential parking and parking for visitors and loading bays will only apply where the parking space is used exclusively for, rather than set aside for, the relevant exempt purpose.
Subclause (2) substitutes the current section 17(2) of the Congestion Levy Act 2005, which provides an exemption for parking spaces set aside and used exclusively for the parking of a motor vehicle by a person whilst a patient of a hospital or whilst visiting or accompanying a patient of a hospital. This exemption was only intended to apply to parking spaces provided by a hospital. The substituted section 17(2) ensures that the exemption operates as intended by limiting the exemption to parking spaces owned by or leased to a hospital that are used exclusively for the parking of a motor vehicle by a person while a patient of the hospital or while visiting or accompanying a patient of the hospital.
Clause 9 substitutes section 20 of the Congestion Levy Act 2005, which provides an exemption for parking spaces which are only temporarily available or in existence for a period of time for special events. This exemption applied to a parking space set aside or used exclusively for parking at a particular event, that at all other times was not available for the parking of a motor vehicle. The new section 20 only exempts a parking space if it is used exclusively for the parking, without charge, of a motor vehicle in conjunction with a particular event, and at all other times is not available for the parking of a motor vehicle.
Clause 10 amends sections 22, 23 and 24 of the Congestion Levy Act 2005 by omitting the words "set aside or". This will ensure that the exemptions which apply to parking for shift workers, garaging of fleet vehicles, bus layovers, car sale displays and car service spaces will only apply where the parking space is used exclusively for, rather than set aside for, an exempt purpose.
Clause 11 Paragraph (a) amends section 26(2) of the Congestion Levy Act 2005 by omitting the words "taking into account the statutory ratio for the public car park under section 14 or 15 (as the case may be)". Section 26 applies a concession for each space in a public car park that is exempt for part of the year, or not available as a parking space for a full year. This amendment removes a redundant reference to the statutory ratio, which is repealed by clause 7 of the Bill. The statutory ratio was previously required to be taken into account when calculating the amount of concession.
Paragraph (b) substitutes a new example at the foot of section 26(2) to explain how the part year concession for parking spaces in a public car park operates from 2014.
Clause 12 inserts a new section 40 in the Congestion Levy Act 2005 which provides the transitional arrangements for the increase in levy amount and extension of the levy to short stay parking spaces in 2014.
The new section 40(1) provides that, for the purposes of assessing the levy for 2014, section 13 applies as if a reference in that section to each space on premises that existed as a leviable parking space at any time in the previous year were a reference to each space on the premises that existed as a parking space at any time in the previous year (other than an exempt parking space) whether or not the parking space was a long stay parking space. This provision is required because assessment of the levy in 2014 will be based on the usage of all non-exempt parking spaces in 2013, including those that were not long stay parking spaces and therefore not leviable in 2013.
For the avoidance of doubt the new subsection 40(2) provides that nothing in the State Tax Laws Amendment (Budget and Other Measures) Act 2013 affects the assessment of the levy forany year before 2014.
The new section 40(3) preserves the definition of long stay parking space in section 4 as in force immediately before the commencement of Part 2 of the State Tax Laws Amendment (Budget and Other Measures) Act 2013 for the purposes of this transitional provision.
PART 3—DUTIES ACT 2000
Part 3 of the Bill amends the Duties Act 2000 to bring forward a duty reduction for eligible first home buyers from 1 January 2014 to 1 July 2013, ensure that the eligible first home buyer duty reduction operates as intended, increase the threshold for the young farmers' duty exemption and concession on single title purchases, extend the exemption for vehicles modified to carry incapacitated passengers and make amendments to the landholder provisions.
Clause 13 inserts into section 3(1) of the Duties Act 2000 a definition of NZX which is "the company registered in New Zealand known as NZX Limited".
The definition of listed company is amended to include a corporation all the shares in which are quoted on the NZX.
The definition of listed trust is amended to include a unit trust scheme all the units in which are quoted on the NZX.
These amendments will support the unique trade and investment relationship between Australia and New Zealand by ensuring that concessions that apply to listed companies and listed trusts under the landholder duty provisions extend to companies listed on the largest exchange in New Zealand, NZX Limited.
Clause 14 Subclause (1)(a) substitutes paragraph (b) of the definition of listed company in section 3(1) of the Duties Act 2000 so that a listed company includes a "a corporation all the shares in which are quoted on any exchange of the World Federation of Exchanges (other than the ASX or an equivalent exchange)".
Subclause (1)(b) substitutes paragraph (b) of the definition of listed trust in section 3(1) of the Duties Act 2000 so that a listed trust includes "a unit trust scheme all the units in which are quoted on any exchange of the World Federation of Exchanges (other than the ASX or an equivalent exchange)".
Subclause (2) repeals section 3(4) of the Duties Act 2000.
These amendments remove the requirement for the Commissioner of State Revenue to declare an entity to be a listedcompany, listed unit trust scheme or private company. This requirement was necessary as an anti avoidance measure under the previous land rich duty model, because acquisitions in listed entities were not subject to duty. This requirement is now redundant, as listed companies and unit trust schemes form part of the tax base under the landholder duty model.