State Taxation Acts Further Amendment Act 2019 (Vic)

State Taxation Acts Further Amendment Act 2019

No. 46 of 2019

table of provisions

Section  Page

Part 1—Preliminary

1Purposes

2Commencement

Part 2—Amendment of Duties Act 2000

Division 1—Young farmers

3Definitions for young farmer provisions

4Disqualifying interest

5New section 69AC substituted

6Transitional provisions

Division 2—Insurance duty

7New sections 184, 185 and 186 substituted

8Transitional provision

Division 3—Livestock duty

9Registration of approved agents

Division 4—Consequential amendment

10Special disability trusts

Part 3—Amendment of Gambling Regulation Act 2003

11Victorian racing industry payment

12New section 4.6A.5A inserted

13Section 4.6A.6 substituted

14Consequential amendment of ANZAC Day Act 1958

Part 4—Amendment of Land Tax Act 2005

Division 1—Vacant residential land tax

15Definitions

16What is residential land?

17When is residential land vacant?

18Definitions—section 52

19Holiday home exemption

20Exemption for land occupied for purposes of attending place of business or employment

21Heading to section 88C amended

22Heading to section 88D amended

23Transitional provision

Division 2—Primary production land

24New subdivision headings inserted in Division 2 of Part 4

25Section 67 substituted and new sections 67A to 67F inserted

26Further new Subdivision headings inserted in Division 2 of Part 4

27Parcels of land

28Consequential amendment of First Home Owner Grant Act 2000

Division 3—Principal place of residence—implied and constructive trusts

29Principal place of residence exemption

Part 5—Amendment of Valuation of Land Act 1960

30Notice of valuation

Part 6—Repeal of this Act

31Repeal of this Act

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Endnotes

1      General information

State Taxation Acts Further Amendment Act 2019

No. 46 of 2019

[Assented to 19 November 2019]

The Parliament of Victoria enacts:

Part 1—Preliminary

1Purposes

The purposes of this Act are—

(a)to amend the Duties Act 2000 in relation to—

(i)the primary production requirement for the young farmers concession and exemption; and

(ii)insurance duty; and

(iii)the registration of livestock agents; and

(b)to amend the Gambling Regulation Act 2003 in relation to—

(i)payments to the ANZAC Day Proceeds Fund; and

(ii)the Victorian racing industry payment; and

(c)to amend the Land Tax Act 2005 in relation to—

(i)vacant residential land tax; and

(ii)the exemption from land tax for primary production land; and

(iii)implied and constructive trusts; and

(d)to amend the Valuation of Land Act 1960 in relation to giving notice of valuations.

2Commencement

(1)This Act (except Part 3) comes into operation on the day after the day on which it receives the Royal Assent.

(2)Part 3 comes into operation on 1 January 2020.

Part 2—Amendment of Duties Act 2000

Division 1—Young farmers

3Definitions for young farmer provisions

In section 69AA of the Duties Act 2000—

(a)insert the following definition—

"nominee for a young farmer means a person who holds farmland on trust for a young farmer but has no other active powers in respect of that land;";

(b)for the definition of young farmer substitute—

"young farmer means a natural person (not acting in the capacity of a trustee under a trust) who is engaged in, or intends to engage in, primary production on farmland;";

(c)in the definition of young farmer business entity, in paragraph (a), for "trustee" substitute "nominee".

4Disqualifying interest

In section 69AB(b)(i) of the Duties Act 2000, for "trustee" (where twice occurring) substitute "nominee".

5New section 69AC substituted

For section 69AC of the Duties Act 2000 substitute—

"69AC   Primary production requirement

(1)The concession and exemption under this Division are subject to the requirements in this section (the primary production requirement).

(2)If the transferee of the dutiable property is a young farmer or a nominee for a young farmer, by the end of the relevant period the young farmer—

(a)must carry on the business of primary production on the farmland; and

(b)must normally be engaged in a substantially full-time capacity in that business.

(3)If the transferee of the dutiable property is a company (not acting in the capacity of a trustee under a trust), by the end of the relevant period—

(a)the principal business of the company must be primary production on the farmland; and

(b)the young farmer must normally be engaged in a substantially full-time capacity in that business.

(4)If the transferee of the dutiable property is a trustee under a trust, by the end of the relevant period—

(a)the principal business of the trust must be primary production on the farmland; and

(b)the young farmer must normally be engaged in a substantially full-time capacity in that business.

(5)In this section—

relevant period means the period of 5 years from the date the transferee entered the contract for the transfer of the dutiable property.".

6Transitional provisions

After clause 55 of Schedule 2 to the Duties Act 2000 insert—

"56   State Taxation Acts Further Amendment Act 2019—young farmers

(1)Division 7 of Part 5 of Chapter 2, as in force immediately before the commencement day, continues to apply in respect of a transfer of dutiable property on or after that day if the contract for the transfer was entered into before that day.

(2)In this clause—

commencement day means the day on which Division 1 of Part 2 of the State Taxation Acts Further Amendment Act 2019 comes into operation.".

Division 2—Insurance duty

7New sections 184, 185 and 186 substituted

For sections 184, 185 and 186 of the Duties Act 2000 substitute—

"184   Who is an insurer?

An insurer is a person—

(a)who writes general insurance; and

(b)who does so otherwise than as an insurance intermediary.

185Certain insurers must be registered

An insurer must be registered under this Part if the insurer is a person who is—

(a)authorised under the Insurance Act 1973 of the Commonwealth to carry on insurance business; or

(b)registered under the Life Insurance Act 1995 of the Commonwealth.

Penalty:100 penalty units.

Note

Section 130B of the Taxation Administration Act 1997 applies to an offence against this section.

186Registration

The Commissioner must register an insurer who is required to be registered under this Part if the insurer applies in the approved form for registration.".

8Transitional provision

After clause 56 of Schedule 2 to the Duties Act 2000 insert—

"57   State Taxation Acts Further Amendment Act 2019—insurance duty

Chapter 8 must be taken to have applied at all times on and after 1 July 2014 as if the amendments made to that Chapter by section 7 of the State Taxation Acts Further Amendment Act 2019 had come into operation on that day.

Note

1 July 2014 is the date on which the amendments to Chapter 8 made by the Building a Better Victoria (State Tax and Other Legislation Amendment) Act 2014 came into operation.".

Division 3—Livestock duty

9Registration of approved agents

In section 248A(4) of the Duties Act 2000, in the definition of Secretary, for "Department of Environment and Primary Industries" substitute "Department of Jobs, Precincts and Regions".

Division 4—Consequential amendment

10Special disability trusts

In section 38A(6) of the Duties Act 2000, in the definition of principal beneficiary, in paragraph (a), for "Act;" substitute "Act; or".

Part 3—Amendment of Gambling Regulation Act 2003

11Victorian racing industry payment

In section 4.6A.5(1) of the Gambling Regulation Act 2003, for "received as" substitute "paid or payable to be".

12New section 4.6A.5A inserted

After section 4.6A.5 of the Gambling Regulation Act 2003 insert—

"4.6A.5A   ANZAC Day Proceeds Fund

Before the end of each financial year the Treasurer must pay out of the Consolidated Fund (which is appropriated to the necessary extent) into the ANZAC Day Proceeds Fund established under the ANZAC Day Act 1958 an amount equal to one-thirtieth of the amount of wagering and betting tax paid or payable in respect of the month of April in that financial year.".

13Section 4.6A.6 substituted

For section 4.6A.6 of the Gambling Regulation Act 2003 substitute—

"4.6A.6   Hospitals and Charities Fund

The following amounts must be paid out of the Consolidated Fund (which is appropriated to the necessary extent) into the Hospitals and Charities Fund—

(a)an amount equal to the amount of wagering and betting tax paid or payable in respect of each month other than April less the Victorian racing industry payment for that month;

(b)an amount equal to the amount of wagering and betting tax paid or payable in respect of the month of April less—

(i)the Victorian racing industry payment for that month; and

(ii)the payment into the ANZAC Day Proceeds Fund under section 4.6A.5A in respect of that month.".

14Consequential amendment of ANZAC Day Act 1958

In section 4A(2) of the ANZAC Day Act 1958, for "or by the Racing Act 1958" substitute ", the Racing Act 1958 or any other Act".

Part 4—Amendment of Land Tax Act 2005

Division 1—Vacant residential land tax

15Definitions

In section 3(1) of the Land Tax Act 2005 insert the following definitions—

"principal beneficiary, of a special disability trust—

(a)has the meaning given in section 1209M(1) of the Social Security Act, in the case of a special disability trust within the meaning of section 1209L of that Act; or

(b)has the meaning given in section 52ZZZWA(1) of the Veterans' Entitlements Act, in the case of a special disability trust within the meaning of section 52ZZZW of that Act;

Social Security Act means the Social Security Act 1991 of the Commonwealth;

special disability trust means—

(a)a special disability trust within the meaning of section 1209L of the Social Security Act; or

(b)a special disability trust within the meaning of section 52ZZZW of the Veterans' Entitlements Act;

vested beneficiary, in relation to land held on trust, means a beneficiary of the trust who—

(a)is a natural person; and

(b)has a vested beneficial interest in possession in the land or is the principal beneficiary of a special disability trust;

Veterans' Entitlements Act means the Veterans' Entitlements Act 1986 of the Commonwealth;".

16What is residential land?

(1)For section 34B(2)(b) of the Land Tax Act 2005 substitute—

"(b)before the commencement of the construction or renovation—

(i)the land was capable of being used solely or primarily for residential purposes; or

(ii)there was a residence that was uninhabitable on the land; and".

(2)After section 34B(2) of the Land Tax Act 2005 insert—

"(2A)Land is also residential land for the purposes of this Division if—

(a)there is a residence that is uninhabitable on the land; and

(b)the land is not land referred to in subsection (2).".

17When is residential land vacant?

(1)In section 34C(1) of the Land Tax Act 2005—

(a)after "tax year by" insert "any one or more of the following";

(b)in paragraph (a), for "owner; or" substitute "owner;";

(c)in paragraph (b), for "occupant; or" substitute "occupant;".

(2)After section 34C(2) of the Land Tax Act 2005 insert—

"(2A)For the purposes of this Division, residential land referred to in section 34B(2A) is vacant in a tax year if, at the end of the year preceding the tax year, the residence has been uninhabitable for 2 years or more.".

(3)After section 34C(4) of the Land Tax Act 2005 insert—

"(4A)Despite subsection (2A), residential land referred to in section 34B(2A) is not vacant in a tax year if the Commissioner is satisfied there is an acceptable reason for the residence not having been made habitable.".

18Definitions—section 52

(1)In section 52(1) of the Land Tax Act 2005, the definitions of principal beneficiary, Social Security Act, special disability trust, vested beneficiary and Veterans' Entitlements Act are repealed.

(2)In section 52(1) of the Land Tax Act 2005, in paragraph (c) of the definition of trustee, for "liquidator;" substitute "liquidator.".

19Holiday home exemption

(1)In section 88A(1)(a) of the Land Tax Act 2005, after "owner of the land" insert "or a vested beneficiary of a trust to which the land is subject".

(2)In section 88A(2)(b) of the Land Tax Act 2005, after "owner's" insert "or vested beneficiary's".

(3)After section 88A(3) of the Land Tax Act 2005 insert—

"(4)For the purposes of this section, a reference to the owner of land does not include a reference to—

(a)a beneficiary of a trust (including an implied or constructive trust) to which the land is subject; or

(b)a unitholder in a unit trust scheme to which the land is subject.".

20Exemption for land occupied for purposes of attending place of business or employment

(1)In section 88B of the Land Tax Act 2005—

(a)after "owner of the land" insert "or a vested beneficiary of a trust to which the land is subject";

(b)in paragraph (b), after "owner's" insert "or vested beneficiary's".

(2)At the end of section 88B of the Land Tax Act 2005 insert—

"(2)For the purposes of this section, a reference to the owner of land does not include a reference to—

(a)a beneficiary of a trust (including an implied or constructive trust) to which the land is subject; or

(b)a unitholder in a unit trust scheme to which the land is subject.".

21Heading to section 88C amended

In the heading to section 88C of the Land Tax Act 2005, after "during" insert "year preceding".

22Heading to section 88D amended

In the heading to section 88D of the Land Tax Act 2005, after "during" insert "year preceding".

23Transitional provision

After clause 16 of Schedule 3 to the Land Tax Act 2005 insert—

"17   State Taxation Acts Further Amendment Act 2019

(1)Subclause (2) applies to land that, on 1 January 2020, is residential land referred to in section 34B(2A).

(2)For the purposes of section 34C(2A), the residence on the land is taken to have been uninhabitable from 31 December 2019.".

Division 2—Primary production land

24New subdivision headings inserted in Division 2 of Part 4

(1)Before section 64 of the Land Tax Act 2005 insert—

"Subdivision 1—Interpretation".

(2)After section 64 of the Land Tax Act 2005 insert—

"Subdivision 2—Primary production land outside greater Melbourne".

(3)After section 65 of the Land Tax Act 2005 insert—

"Subdivision 3—Primary production land in greater Melbourne but not in an urban zone".

(4)After section 66 of the Land Tax Act 2005 insert—

"Subdivision 4—Primary production land in an urban zone in greater Melbourne".

25Section 67 substituted and new sections 67A to 67F inserted

For section 67 of the Land Tax Act 2005 substitute—

"67   Exemption of primary production land in an urban zone in greater Melbourne

(1)Land is exempt land if the Commissioner determines that—

(a)the land comprises one parcel that is—

(i)wholly or partly in greater Melbourne; and

(ii)wholly or partly in an urban zone; and

(iii)used solely or primarily for the business of primary production; and

(b)the owner of the land meets the requirements in—

(i)if the owner is a natural person not acting in the capacity as trustee of a trust to which the land is subject—section 67A; or

(ii)if the owner is a proprietary company not acting in the capacity as trustee of a trust to which the land is subject—section 67B; or

(iii)if the owner is a trustee of a superannuation trust to which the land is subject—section 67C; or

(iv)if the owner is a trustee of a discretionary trust to which the land is subject—section 67D; or

(v)if the owner is a trustee of a trust (other than a discretionary trust or superannuation trust) to which the land is subject or a unit trust scheme to which the land is subject—section 67E.

(2)For the purposes of this section, a reference to the owner of land does not include a reference to—

(a)a beneficiary of a trust (including an implied or constructive trust) to which the land is subject; or

(b)a unitholder in a unit trust scheme to which the land is subject.

67ARequirements for non-trustee natural person

For the purposes of section 67(1)(b)(i), the requirements for an owner who is a natural person (not acting in the capacity as trustee of a trust to which the land is subject) are that—

(a)the owner—

(i)carries on the business of primary production referred to in section 67(1)(a)(iii); and

(ii)either—

(A)is normally engaged in a substantially full-time capacity in that business; or

(B)is not normally engaged in a substantially full-time capacity in that business, but has a relative who is normally so engaged; or

(b)a relative of the owner—

(i)carries on the business of primary production referred to in section 67(1)(a)(iii); and

(ii)either—

(A)is normally engaged in a substantially full-time capacity in that business; or

(B)is not normally engaged in a substantially full-time capacity in that business, but the owner is normally so engaged.

67BRequirements for non-trustee proprietary company

(1)For the purposes of section 67(1)(b)(ii), the requirements for an owner that is a proprietary company (not acting in the capacity as trustee of a trust to which the land is subject) are that—

(a)the company carries on the business of primary production referred to in section 67(1)(a)(iii); and

(b)the principal business of the company is that business; and

(c)all the company's shares are beneficially owned by natural persons; and

(d)the company meets the requirements in subsection (2) in relation to the distribution of dividends.

(2)For the purposes of subsection (1)(d), the requirements are that—

(a)if the company distributes dividends during the relevant period—

(i)the dividends were distributed to all the holders of the issued share capital of the company in proportion to their respective paid up shareholdings; and

(ii)50% or more of the dividends were paid to a person or persons—

(A)normally engaged in a substantially full-time capacity in the business of primary production referred to in section 67(1)(a)(iii); or

(B)whose relative or relatives were normally engaged in a substantially full-time capacity in the business of primary production referred to in section 67(1)(a)(iii); or

(b)if no dividends were distributed during the relevant period, ordinary shares representing 50% or more of the issued share capital of the company have been beneficially owned for the relevant period by a person or persons—

(i)normally engaged in a substantially full-time capacity in the business of primary production referred to in section 67(1)(a)(iii); or

(ii)whose relative or relatives were normally engaged in a substantially full-time capacity in the business of primary production referred to in section 67(1)(a)(iii).

(3)For the purposes of subsection (2), a reference to the issued share capital of a company does not include a reference to any part of it that carries no right to participate beyond a specified amount in a distribution of either profits or capital.

67CRequirements for trustee of superannuation trust

For the purposes of section 67(1)(b)(iii), the requirements for an owner who is a trustee of a superannuation trust to which the land is subject are that—

(a)all the members or beneficiaries (as the case requires) of the trust are relatives; and

(b)at least one member or beneficiary (as the case requires) of the trust is normally engaged in a substantially full-time capacity in the business of primary production referred to in section 67(1)(a)(iii).

67DRequirements for trustee of discretionary trust

(1)For the purposes of section 67(1)(b)(iv), the requirements for an owner who is a trustee of a discretionary trust to which the land is subject are that—

(a)the trustee carries on the business of primary production referred to in section 67(1)(a)(iii); and

(b)the principal business of the trust is that business; and

(c)either—

(i)each specified beneficiary is a natural person; or

(ii)at least one of the specified beneficiaries is a natural person and each of the specified beneficiaries who is not a natural person is a person referred to in subsection (2); and

(d)either—

(i)at least one of the specified beneficiaries is a natural person who is normally engaged in a substantially full-time capacity in the business of primary production referred to in section 67(1)(a)(iii); or

(ii)a relative of at least one of the specified beneficiaries is normally engaged in a substantially full‑time capacity in the business of primary production referred to in section 67(1)(a)(iii).

(2)For the purposes of subsection (1)(c)(ii), the persons are—

(a)a charitable institution or a trustee of a charitable trust; or

(b)a company all the shares in which are owned by one or more of the specified beneficiaries who are natural persons; or

(c)a trustee of a trust (except a charitable trust), all the beneficiaries or specified beneficiaries of which are specified beneficiaries of the discretionary trust who are natural persons.

67ERequirements for trustee of a trust (other than a discretionary trust or superannuation trust) or unit trust scheme

For the purposes of section 67(1)(b)(v), the requirements for an owner who is the trustee of a trust (other than a discretionary trust or superannuation trust) to which the land is subject or a unit trust scheme to which the land is subject are that—

(a)the trustee carries on the business of primary production referred to in section 67(1)(a)(iii); and

(b)the principal business of the trust or unit trust scheme is that business; and

(c)each beneficiary of the trust or unitholder (as the case requires) is a natural person who is entitled under the trust deed to an annual distribution of the trust income; and

(d)at least one of the beneficiaries of the trust or unitholders (as the case requires), or a relative of at least one of the beneficiaries or unitholders, is normally engaged in a substantially full-time capacity in that business.

67FJoint ownership of parcel of land referred to in section 67(1)(a)

If a parcel of land referred to in section 67(1)(a) is owned by joint owners, each joint owner must meet relevant requirements for that type of owner in sections 67A, 67B, 67C, 67D or 67E.".

26Further new Subdivision headings inserted in Division 2 of Part 4

(1)Before section 68 of the Land Tax Act 2005 insert—

"Subdivision 5—Land being prepared for use for primary production".

(2)After section 68 of the Land Tax Act 2005 insert—

"Subdivision 6—General".

27Parcels of land

For section 70(2)(b) of the Land Tax Act 2005 substitute—

"(b)the owner of the parcel of land meets the requirements in section 67A, 67B, 67C, 67D or 67E.".

28Consequential amendment of First Home Owner Grant Act 2000

In section 13(10) of the First Home Owner Grant Act 2000—

(a)in paragraph (a)(i), for "the owner of the land within the meaning of section 67(2)(a) (as affected by that section)" substitute "an owner of the land (not acting in the capacity as trustee of a trust to which the land is subject) who meets the requirements in section 67A";

(b)in paragraph (a)(ii), for "described in section 67(2)(b) (as affected by that section)" substitute "(not acting in the capacity as trustee of a trust to which the land is subject) that meets the requirements in section 67B".

Division 3—Principal place of residence—implied and constructive trusts

29Principal place of residence exemption

(1)In section 54(1)(a) of the Land Tax Act 2005, after "natural person" insert "(who is not a person specified in subsection (4A))".

(2)After section 54(4) of the Land Tax Act 2005 insert—

"(4A)For the purposes of subsection (1)(a), the following persons are specified—

(a)a trustee of a trust (including an implied or constructive trust) to which the land is subject;

(b)a beneficiary of a trust (including an implied or constructive trust) to which the land is subject;

(c)a unitholder in a unit trust scheme to which the land is subject.".

Part 5—Amendment of Valuation of Land Act 1960

30Notice of valuation

For section 15(4) of the Valuation of Land Act 1960 substitute—

"(4)A notice of valuation must be given on or before 30 September in the year in which the valuation is made.".

Part 6—Repeal of this Act

31Repeal of this Act

This Act is repealed on 1 January 2021.

Note

The repeal of this Act does not affect the continuing operation of the amendments made by it (see section 15(1) of the Interpretation of Legislation Act 1984).

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Endnotes

1   General information

See for Victorian Bills, Acts and current authorised versions of legislation and up-to-date legislative information.

Minister's second reading speech—

Legislative Assembly: 16 October 2019

Legislative Council: 31 October 2019

The long title for the Bill for this Act was "A Bill for an Act to amend the Duties Act 2000, the Gambling Regulation Act 2003, the Land Tax Act 2005 and the Valuation of Land Act 1960 and for other purposes."