Local Government (Personal Income Tax Sharing) Amendment Act 1980

Overview

The Local Government (Personal Income Tax Sharing) Amendment Act 1980, assented to on 8 May 1980, was enacted to address the need for adjustments in the distribution of personal income tax revenue between the Commonwealth and local governments. This amendment was passed by the Queen, with the concurrence of the Senate and the House of Representatives of the Commonwealth of Australia, to modify the Local Government (Personal Income Tax Sharing) Act 1976. The policy objective underpinning this Act is to alter the base figure used in the calculation of the tax revenue share, thereby adjusting the financial arrangement between the federal and local government tiers. Specifically, the Act replaces the previous base figure of 1.75% with a new figure of 2%, effective from the year commencing 1 July 1980. This change is aimed at reflecting updated fiscal realities and ensuring a more equitable distribution of tax revenues.

Scope and Application

The Local Government (Personal Income Tax Sharing) Amendment Act 1980 amends the Local Government (Personal Income Tax Sharing) Act 1976, primarily adjusting the percentage of personal income tax that is to be shared with local government. This Act applies to the Commonwealth of Australia and pertains to the calculation and distribution of personal income tax revenue between the federal government and local councils. It specifically modifies the base figure used in the Principal Act from 1.75% to 2%, effective from the year commencing 1 July 1980. The geographic reach of this amendment is national, as it concerns the sharing of federal tax revenue with local governments across the entire country. There are no specific exclusions or exemptions outlined in the Act, and its application is directly governed by the changes to the Principal Act without the need for subordinate instruments. This amendment aims to ensure that local governments receive an updated proportion of personal income tax, reflecting changes in fiscal arrangements or policy objectives.

Key Provisions

The Local Government (Personal Income Tax Sharing) Amendment Act 1980 (sections 1-3) amends the Local Government (Personal Income Tax Sharing) Act 1976. Specifically, it modifies the base figure used in the calculation of the amount of personal income tax shared with local governments. Under section 3(1) of the Principal Act, the term "base figure" is amended by changing the percentage from 1.75% to 2%, effective from the year commencing 1 July 1980. This amendment introduces certain obligations on the parties involved, primarily the Commonwealth and local governments. The revised base figure (section 3(2)) requires that local governments and the Commonwealth recalculate the amount of personal income tax to be shared according to the new percentage. This recalculation is to be applied from the commencement of the financial year on 1 July 1980 onwards. Local governments must ensure that their financial planning and budgeting processes incorporate this change, while the Commonwealth is obligated to adjust the tax distribution mechanism to reflect the new base figure. Breaches of the obligations set out in the Act, such as failure by local governments to adjust their calculations according to the amended base figure, could lead to administrative and possibly financial repercussions. The Act does not explicitly state penalties for non-compliance, but it is reasonable to infer that there could be consequences under the broader local government financial regulations or specific administrative law provisions. The lack of explicit penalties in this Act might suggest that oversight and enforcement would rely on the general compliance frameworks governing local government financial management in Australia.