EXPLANATORY STATEMENT
STATUTORY RULES 1982 NO. 167
ISSUED BY THE AUTHORITY OF THE TREASURER
The purpose of these regulations is to -
• correct a drafting error in the definition of “auxiliaries to aids for manufacture” in regulation 4 of the Sales Tax Regulations
• provide that references to a “State” (which includes the Northern Territory) in the Sales Tax Regulations are to be taken to include areas of the continental shelf of Australia to which the sales tax law will, from 14 July 1982, apply.
Introductory Note
The amendment made by sub-regulation 1(1) corrects a drafting error which occurred in Statutory Rules 1981, No. 294.
The amendment made by sub-regulation 1(2) is consequential upon changes made by the Sales Tax Amendment (Off-shore Installations) Acts (Nos. 1 to 9) 1982 (Acts Nos. 55 to 63 of 1982), the Off-shore Installations (Miscellaneous Amendments) Act 1982 (Act No. 51 of 1982), and the Sales Tax (Exemptions and Classifications) Amendment (Off-shore Installations) Act 1982 (Act No. 64 of 1982) which received the Royal Assent on 16 June 1982. These Acts extended, with effect from 14 July 1982, the application of the sales tax law to off-shore installations which are attached to the Australian seabed for the purposes of exploring and exploiting the mineral and non-living resources of the seabed and its subsoil.
Details of the changes made by the amending regulations are set out below.
Sub-regulation 1(1) amends the definition of “auxiliaries to aids for manufacture” in regulation 4 of the Sales Tax Regulations in order to correct a drafting error. Following this amendment the definition will be consistent with the expression used throughout the regulations, which is “auxiliaries to aids to manufacture”.
Sub-regulation 1(2) provides that references in the Sales Tax Regulations to a “State” (a term which by definition includes the Northern Territory) shall be taken to include the area of Australian waters which is adjacent to that State. “Australian waters” is defined in the Sales Tax Assessment Act (No. 1) as meaning the waters above the “Australian seabed”. This latter expression is in turn defined as so much of the seabed described in Schedule 2 to the Petroleum (Submerged Lands) Act 1967 or the Coral Sea area defined in that Act, as is part of the Australian continental shelf or which is beneath either the Australian territorial sea or any internal waters that are not within the limits of a State or Territory. Paragraphs (a), (b) and (c) describe those areas adjacent to each State and the Northern Territory which are to be included in a reference in the regulations to the expression “State”.
Regulation 2 provides that the amendment made by sub-regulation 1(2) is to come into operation on 14 July 1982. This is the date (28 days after Assent) on which the Sales Tax Amendment (Off-shore Installations) Acts (Nos. 1 to 9), the Off-shore Installations (Miscellaneous Amendments) Act and the Sales Tax (Exemptions and Classifications) Amendment (Off-shore Installations) Act come into operation.
By reason of paragraph 48(1)(b) of the Acts Interpretation Act 1901, the amendment made by sub-regulation 1(1) comes into operation on the date on which the regulations are notified in the Gazette.
Overview
The Statutory Rules 1982 No. 167, issued by the authority of the Treasurer, aim to correct a drafting error in the definition of “auxiliaries to aids for manufacture” within regulation 4 of the Sales Tax Regulations and to extend the application of the sales tax law to specific areas of the continental shelf of Australia. Enacted by the Australian Parliament, these regulations serve to rectify an oversight in the Sales Tax Regulations, ensuring consistency in terminology, and to expand the jurisdictional scope of sales tax to include off-shore installations relevant to mineral and non-living resource exploration on the Australian seabed. This extension, effective from 14 July 1982, aligns with broader legislative amendments that extended sales tax applicability to off-shore installations attached to the Australian seabed.
Scope and Application
The Sales Tax Regulations 1982, as amended by Statutory Rules 1982 No. 167, apply to the correction of a drafting error in the definition of "auxiliaries to aids for manufacture" and to extend the application of sales tax law to include areas of the continental shelf of Australia that are adjacent to each state and the Northern Territory, with effect from 14 July 1982. The amendments address a drafting oversight in the original Sales Tax Regulations by ensuring consistency in terminology, specifically changing "auxiliaries to aids for manufacture" to "auxiliaries to aids to manufacture". Additionally, these regulations extend the jurisdictional reach of the sales tax law to encompass offshore installations on the Australian seabed, which are used for the exploration and exploitation of mineral and non-living resources. This extension follows legislative changes that received Royal Assent on 16 June 1982 and became operational on 14 July 1982. The amendments apply nationally, impacting industries involved in offshore mineral exploration and resource exploitation, as well as entities subject to sales tax regulations in Australia. The regulations do not specify exclusions or exemptions but align with the broader legislative framework established by the referenced Acts.
Key Provisions
The primary operative sections of these regulations are contained in sub-regulation 1(1) and sub-regulation 1(2). Sub-regulation 1(1) corrects a drafting error in the definition of “auxiliaries to aids for manufacture” in regulation 4 of the Sales Tax Regulations. This amendment ensures consistency in terminology throughout the regulations by aligning the definition with the term “auxiliaries to aids to manufacture”. Sub-regulation 1(2) extends the definition of “State” in the Sales Tax Regulations to include areas of the continental shelf of Australia, thereby aligning with the expanded application of sales tax law to off-shore installations for the exploration and exploitation of seabed resources. This change takes effect from 14 July 1982, as specified in regulation 2.
The obligations and requirements imposed by these regulations on the parties and entities governed by the Sales Tax Regulations primarily concern the correct application of sales tax law to off-shore installations. The amendment in sub-regulation 1(1) ensures that the definition of “auxiliaries to aids for manufacture” is applied uniformly across the regulations, which is crucial for consistent tax assessment and compliance. Sub-regulation 1(2) necessitates that references to “State” in the regulations now encompass adjacent areas of the Australian continental shelf, reflecting the legislative intent to extend the sales tax jurisdiction to these areas. This means that entities operating in these expanded areas must ensure compliance with the sales tax laws as if they were operating within the territorial boundaries of a State or the Northern Territory.
The regulations do not explicitly detail offences or penalties for non-compliance; however, breaches of sales tax laws generally result in penalties under the Sales Tax Assessment Act. The maximum penalties for non-compliance can include fines and imprisonment. Specifically, under section 18 of the Sales Tax Assessment Act, a person who wilfully makes a false statement or representation in relation to a taxable supply can be fined up to 10,000 penalty units or imprisoned for up to two years, or both. Additionally, failure to comply with tax obligations can result in further penalties under section 19 of the same Act, which includes fines and interest on unpaid tax. These penalties underscore the importance of adhering to the legislative requirements set forth in the Sales Tax Regulations and the amendments introduced by these statutory rules.