Commonwealth Authorities Legislation (Pay-roll Tax) Amendment Act 1988

Overview

The Commonwealth Authorities Legislation (Pay-roll Tax) Amendment Act 1988 was enacted to address the gap in State and Territory payroll tax exemptions for specific Commonwealth authorities. This Act was assented to on 15 June 1988 and commenced on 1 July 1988. The Parliament of Australia enacted this legislation to ensure that certain Commonwealth authorities were no longer exempt from State and Territory payroll taxes, thus contributing to a more equitable distribution of tax liabilities across the various entities within the federal system. The Act amends several pieces of legislation including the Australian National Railways Commission Act 1983, the Civil Aviation Act 1988, the Federal Airports Corporation Act 1986, the Postal Services Act 1975, and the Telecommunications Act 1975, by specifically excluding the application of subsections relating to payroll tax. The policy objective is to eliminate the payroll tax exemptions for these Commonwealth authorities, thereby aligning their tax liabilities with those of other entities within the respective states and territories.

Scope and Application

The Commonwealth Authorities Legislation (Pay-roll Tax) Amendment Act 1988 amends specific Australian Acts to remove the exemption from state and territory payroll tax for certain Commonwealth authorities. This Act applies to the Australian National Railways Commission, the Civil Aviation Authority, the Federal Airports Corporation, the Australian Postal Commission, and the Department of Communications, all of which are specified in the Schedule of the Act. By amending these Acts, the legislation effectively subjects these Commonwealth authorities to state and territory payroll tax, which previously they were exempt from. The Act came into effect on 1 July 1988 and does not explicitly mention any exclusions, exemptions, or thresholds other than those specified in the amendments. The amendments extend the reach of state and territory payroll tax laws to the specified Commonwealth authorities by modifying the relevant Acts to exclude their application to payroll tax legislation.

Key Provisions

The Commonwealth Authorities Legislation (Pay-roll Tax) Amendment Act 1988 (the "Act") serves to modify several pieces of legislation by removing the exemption from state and territory payroll tax that certain Commonwealth authorities previously enjoyed. This is achieved through amendments to the Australian National Railways Commission Act 1983, Civil Aviation Act 1988, Federal Airports Corporation Act 1986, Postal Services Act 1975, and Telecommunications Act 1975. The Act amends these statutes by adding specific subsections that clarify the non-application of certain provisions to laws relating to payroll tax at the state and territory level. The main sections of the Act include the introduction of new subsections (1a) in the specified acts. For instance, in the Australian National Railways Commission Act 1983, the Act omits "subsection (4)" and substitutes it with "subsections (1a) and (4)" and inserts a new subsection (1a) stating that subsection (1) does not apply to laws relating to payroll tax. Similar amendments are made to other acts listed in the schedule. The purpose of these changes is to ensure that the previously exempt Commonwealth authorities are now subject to state and territory payroll tax laws. The Act imposes specific obligations on the entities affected by these amendments. These entities, which include the Australian National Railway Commission, Civil Aviation authorities, Federal Airports Corporation, and other specified authorities, must now comply with state and territory payroll tax laws. This means they are required to remit payroll tax in accordance with the laws of the state or territory in which they operate, just as any other employer would be required to do. The removal of the exemption means these authorities can no longer avoid the payroll tax obligations that apply to other businesses. For breaches of the amended provisions, there are potential civil and criminal consequences, although the Act itself does not explicitly state these penalties. Typically, non-compliance with payroll tax laws can result in significant fines, penalties, and legal action by the relevant state or territory revenue authorities. The exact penalties would depend on the specific state or territory laws, which may include substantial fines and interest on unpaid taxes, as well as potential prosecution leading to criminal penalties for wilful default. It is important for the affected authorities to ensure full compliance to avoid these repercussions.