Sales Tax (No. 6) Amendment Act 1985

Overview

The Sales Tax (No. 6) Amendment Act 1985 was enacted to address specific shortcomings and update the existing Sales Tax Act (No. 6) 1930. The Act was passed by the Queen, and the Senate and the House of Representatives of the Commonwealth of Australia on 5 December 1985. Its primary objective was to revise the rates of sales tax on imported goods and those applied to the taxpayer’s own use, effective from 20 September 1985. This amendment sought to streamline the tax imposition process and ensure clarity and fairness in the application of sales tax across various categories of goods.

Scope and Application

The Sales Tax (No. 6) Amendment Act 1985 amends the Sales Tax Act (No. 6) 1930 by imposing sales tax on the sale value of goods imported into Australia and sold or applied to the taxpayer’s own use by a taxpayer on or after the Act's commencement date of 20 September 1985. This Act applies to taxpayers who import goods into Australia and either sell them or use them for their own purposes. It specifies the rates of sales tax applicable to various categories of goods, distinguishing between those covered by different schedules in the Sales Tax (Exemptions and Classifications) Act 1935 and those not covered by these schedules. The tax rates are set at 20%, 10%, or 30% depending on the classification of the goods, with a default rate of 20% for goods not explicitly exempted or classified. This Act has a national reach as it applies across Australia, and it effectively updates and replaces previous provisions of the Principal Act with new rates and application rules. Any sales tax imposed before the Act's commencement continues as if the old provisions had not been repealed, ensuring continuity in tax obligations for affected transactions.

Key Provisions

The Sales Tax (No. 6) Amendment Act 1985 makes several key changes to the Sales Tax Act (No. 6) 1930, which is referred to as the Principal Act. The most notable changes relate to the imposition of sales tax on imported goods sold or used by a taxpayer. Under section 3, sales tax is imposed at the rates specified in section 4 on the sale value of goods imported into Australia by a taxpayer and sold or applied to the taxpayer's own use on or after 20 September 1985. Section 4 specifies the rates of sales tax, which vary depending on the classification of the goods. For example, goods covered by the Fourth or Fifth Schedule to the Sales Tax (Exemptions and Classifications) Act 1935 are subject to a 20% sales tax, while goods covered by the Third or Sixth Schedule are subject to a 10% sales tax. Goods not covered by any of the schedules and on which sales tax is not exempted by the Sales Tax (Exemptions and Classifications) Act 1935 are subject to a 20% sales tax. The Act imposes obligations on taxpayers who import goods into Australia and sell or use those goods on or after 20 September 1985. Taxpayers must calculate and remit the applicable sales tax to the relevant tax authority. The rates of sales tax are determined by the classification of the goods, as specified in the Sales Tax (Exemptions and Classifications) Act 1935. Taxpayers must ensure that they are aware of the correct classification of the goods they import and apply the appropriate sales tax rate. Failure to do so may result in penalties or other consequences. The Act also provides for offences, penalties, and consequences for breach. While the specific penalties are not stated in the text provided, it is likely that the Act includes provisions for fines, imprisonment, or other penalties for non-compliance. The maximum penalties would depend on the severity of the breach and the discretion of the relevant tax authority or court. It is important for taxpayers to ensure that they comply with the requirements of the Act to avoid any potential penalties or consequences.