EXPLANATORY STATEMENT
Issued by the authority of the Treasurer of Queensland
Commonwealth Places (Mirror Taxes) Act 1998
Commonwealth Places (Mirror Taxes) Modification of Applied Laws (Queensland) Notice 2002
This notice, together with other legislation and arrangements entered _ into between the Commonwealth and Queensland, form a scheme to address the effect of the 1996 High Court decision in Allders International Pty Ltd v Commissioner of State Revenue (Victoria), which held that State stamp duty on a lease covering part of Commonwealth land was constitutionally invalid. The intention of the scheme in relation to Queensland is to continue taxation arrangements in respect of Commonwealth places situated in Queensland. A taxpayer's liability under the scheme_ is to be as nearly as possible the same as it would be under the Queensland law alone .if the Commonwealth places in Queensland were not Commonwealth places.
Under section 6 of the Commonwealth Places (Mirror Taxes) Act 1998 of the Commonwealth (the Commonwealth Act), the provisions of State taxing laws that would _be excluded by section 52(i),of the Commonwealth Constitution from applying to Commonwealth places are taken to apply as applied laws of the Commonwealth. Under section 8 of the Commonwealth Act, the State Treasurer may, by notice in writing, prescribe modifications of those applied laws.·
By this Notice, the Treasurer of Queensland prescribes modifications to the provisions of the Debits Tax Act 1990, the Land Tax Act 1915 and the Stamp Act 1894 as applied laws in relation to Commonwealth places in Queensland.
In accordance with section 8(4) of the Commonwealth Act, the modifications are made to either enable the effective operation of an applied law as a law of the Commonwealth, or to enable an applied law to operate so that the combined tax liability of a taxpayer under the applied law d the corresponding State taxing law will be as close as possible to what the taxpayer's liability would· have been if the State taxing law applied to all places in Queensland, including Commonwealth places.
The Notice is taken to have commenced on 6 October 1997.
Overview
The Commonwealth Places (Mirror Taxes) Act 1998 was enacted to address the constitutional issues arising from the High Court's decision in Allders International Pty Ltd v Commissioner of State Revenue (Victoria) (1996). This decision held that state stamp duty on leases covering part of Commonwealth land was constitutionally invalid. The Commonwealth Act, along with related legislative instruments such as the Commonwealth Places (Mirror Taxes) Modification of Applied Laws (Queensland) Notice 2002, was introduced to ensure that the taxation arrangements for Commonwealth places in Queensland continue without constitutional impediment. The objective of the scheme is to maintain taxpayers' liabilities under these arrangements as close as possible to what they would have been if the Commonwealth places were not exempt from state taxes. The Notice modifies state taxing laws, such as the Debits Tax Act 1990, the Land Tax Act 1915, and the Stamp Act 1894, to achieve this aim. The modifications were made to either facilitate the effective operation of applied laws as Commonwealth laws or to align the combined tax liability under applied and corresponding state laws with what it would have been if the state laws applied to all places in Queensland, including Commonwealth places.
Scope and Application
The Commonwealth Places (Mirror Taxes) Modification of Applied Laws (Queensland) Notice 2002 applies to taxpayers who are subject to Queensland taxing laws such as the Debits Tax Act 1990, the Land Tax Act 1915 and the Stamp Act 1894 in relation to leases or other transactions involving Commonwealth places in Queensland. This notice, together with other legislation and arrangements between the Commonwealth and Queensland, forms a scheme to address the constitutional invalidation of state stamp duty on leases covering part of Commonwealth land, as determined by the 1996 High Court decision in Allders International Pty Ltd v Commissioner of State Revenue (Victoria). The intention of this scheme for Queensland is to maintain taxation arrangements for Commonwealth places situated in Queensland, ensuring a taxpayer's liability under the scheme remains as close as possible to what it would have been under Queensland law alone if the Commonwealth places were not Commonwealth places. The modifications prescribed by the notice aim to enable the effective operation of these applied laws as Commonwealth laws and ensure the combined tax liability under the applied law and the corresponding state taxing law is as close as possible to the taxpayer's liability under state law alone.
Key Provisions
The key provisions of the Commonwealth Places (Mirror Taxes) Modification of Applied Laws (Queensland) Notice 2002 (the Notice) are detailed under section 8 of the Commonwealth Places (Mirror Taxes) Act 1998 (the Commonwealth Act). This section empowers the State Treasurer to modify certain applied laws, specifically the Debits Tax Act 1990, the Land Tax Act 1915, and the Stamp Act 1894, so that they can effectively operate in relation to Commonwealth places in Queensland. The modifications are made to ensure that the tax liability of taxpayers in these circumstances is as close as possible to what it would have been if the state taxing laws applied to all places in Queensland, including Commonwealth places. The Notice aims to achieve this by either enabling the effective operation of an applied law as a law of the Commonwealth or by ensuring that the combined tax liability of a taxpayer under the applied law and the corresponding state taxing law is aligned with the hypothetical scenario where the state taxing law applied to all places in Queensland.
The obligations imposed on parties by the Notice are primarily directed at taxpayers who are subject to the modified applied laws. These taxpayers must ensure that their tax liabilities are calculated and paid in accordance with the modifications prescribed by the Notice. The Notice requires taxpayers to comply with the modified applied laws, which now include provisions that would otherwise be constitutionally excluded from applying to Commonwealth places. This involves understanding how the modifications affect the calculation of their tax liabilities and ensuring that they adhere to the requirements set out in the Notice. In addition, the Notice obligates the State Treasurer to issue modifications to the applied laws as necessary to achieve the intended tax outcomes, ensuring that taxpayers are not subject to unconstitutional taxation on Commonwealth places.
The Notice also outlines potential consequences for non-compliance with its provisions. Although specific offences and penalties are not detailed within the Notice itself, breaches of the modified applied laws would generally be subject to the penalties and enforcement mechanisms provided by the respective state taxing laws, such as the Debits Tax Act 1990, the Land Tax Act 1915, and the Stamp Act 1894. For example, failure to comply with the Land Tax Act 1915 could result in penalties as prescribed by that Act, which may include fines or other financial penalties. Similarly, non-compliance with the Debits Tax Act 1990 or the Stamp Act 1894 could also lead to penalties as outlined in those respective Acts. The Notice ensures that taxpayers are held accountable for any breaches of the modified applied laws, maintaining the integrity of the tax system in relation to Commonwealth places in Queensland.