Wool Tax Regulations (Nos 1-5) (Amendment) 1993 No. 172
EXPLANATORY STATEMENT
STATUTORY RULES 1993 No. 172
ISSUED BY THE AUTHORITY OF THE ASSISTANT TREASURER
Wool Tax Act (Nos 1-5) 1964
Wool Tax Regulations (Nos 1-5) (Amendment)
These regulations will set the rate of wool tax for the financial year 1 July 1993 to 30 June 1994. The rate for shorn wool other than carpet wool will be reduced from 12% to 8.5% and the rate for carpet wool will remain at 4%.
Sections 6 of the Wool Tax Acts (Nos. 1-5) 1964 (the Acts) provides that the Governor-General may make regulations for the purposes of these Acts. The Wool Tax Acts impose a tax on the sale value of shorn wool produced in Australia. Each of the Wool Tax Acts imposes the tax on a particular dealing with wool. The dealings to which the Acts relate are sale by a wool broker, purchase by a registered wool dealer, purchase by a manufacturer, subjecting the wool to a process of manufacture and export. The need for five separate Acts arises from a Constitutional requirement that laws imposing taxes should deal with one subject of taxation only.
Under each Act, the Governor-General may, within certain limits, prescribe the rate of tax. The maximum rate for shorn wool other than carpet wool is 15% of the sale value of the wool and the maximum rate for carpet wool is 6% of the sale value of the wool. Neither rate can be less than 2.75%. The tax has three elements, a portion allocated to debt management purposes, a portion for marketing and promotion and a portion for wool research and development. Carpet wool does not bear the portion which relates to debt management.
Before making the regulations, the Governor-General is required to consider certain recommendations in relation to the setting of the rate. In the case of shorn wool other than carpet wool, these are the recommendations made by:
• the Australian Wool Realisation Commission (AWRC); and
• the last or special general meeting of wool tax payers held pursuant to the Australian Wool Corporation Act 1991; and
• the last annual general meeting of the Wool Research and Development Corporation (WRDC).
In the case of carpet wool, they are the recommendations made by:
• the last or special general meeting of wool tax payers held pursuant to the Australian Wool Corporation Act 1991; and
• the last annual general meeting of the WRDC.
The Governor-General is also required to consider any views in relation to the rate of wool tax expressed by the Wool Council of Australia to the Australian Wool Realisation Commission.
The Minister for Primary Industries and Energy has now received recommendations on the rate of wool tax on wool sold on and after 1 July 1993. The AWRC recommendation, which takes into account the views of the Wool Council of Australia, is for a rate of 4.5%. This is for the debt management component of the tax. The Australian Wool Corporation annual general meeting has recommended that the marketing and promotion component of the tax should be 3.5%. The WRDC has recommended that the component of the tax for research and development be .5%. These recommendations result in a total rate of 8.5% for shorn wool other than carpet wool.
With respect to carpet wool, the rates recommended are also 3.5% for marketing and promotion (the Australian Wool Corporation component) and 5% for research and development. This gives a total rate for carpet wool of 4%, unchanged since last year.
The Cabinet agreed with these recommendations.
Details of the proposed amendments to the Regulations are as follows:
Regulation 1 - provides that these regulations will commence on 1 July 1993.
Regulation 2 - provides for the amendment of the Regulations.
Regulation 3 - subregulations 3(1) and 3(3) provide that the Regulations will apply for the financial year commencing on 1 July 1993. Subregulation 3(2) provides that the rate for shorn wool other than carpet wool will be 8.5%.
Overview
The Wool Tax Regulations (Nos 1-5) (Amendment) 1993 No. 172, issued under the authority of the Assistant Treasurer, amends the rates of wool tax for the financial year from 1 July 1993 to 30 June 1994. Enacted by the Parliament, these regulations are a response to the need for a structured approach to taxing different types of shorn wool produced in Australia, as required by the Wool Tax Acts (Nos. 1-5) 1964. These Acts impose a tax on the sale value of shorn wool, distinguishing between different types of wool and aligning with constitutional requirements that tax laws focus on a single subject of taxation. The policy objective behind these amendments is to adjust tax rates based on recommendations from relevant industry bodies, ensuring a fair and balanced approach to taxation within the wool industry.
The regulations specifically reduce the tax rate for shorn wool other than carpet wool from 12% to 8.5% while maintaining the rate for carpet wool at 4%. This adjustment follows recommendations from the Australian Wool Realisation Commission, the Australian Wool Corporation, and the Wool Research and Development Corporation, as well as considering the views of the Wool Council of Australia. The new rates aim to balance the needs of debt management, marketing and promotion, and research and development within the industry, reflecting the Cabinet's approval of these recommendations.
Scope and Application
The Wool Tax Regulations (Nos 1-5) (Amendment) 1993 No. 172 applies to the imposition of a tax on the sale value of shorn wool produced in Australia, with the tax being levied on specific dealings with wool such as sale by a wool broker, purchase by a registered wool dealer, purchase by a manufacturer, and export. The Acts apply to entities and individuals involved in these transactions within Australia. The tax rates are set out in the regulations and are subject to recommendations from various bodies, including the Australian Wool Realisation Commission, the Australian Wool Corporation, and the Wool Research and Development Corporation. The amendments to the regulations, effective from 1 July 1993, reduce the rate for shorn wool other than carpet wool from 12% to 8.5% while maintaining the rate for carpet wool at 4%. The tax has components allocated to debt management, marketing and promotion, and wool research and development, with the rate varying depending on the type of wool.
Key Provisions
The main operative sections of the Wool Tax Regulations (Nos 1-5) (Amendment) 1993 No. 172 involve amendments to the tax rates for the financial year 1 July 1993 to 30 June 1994. Specifically, section 3(2) of Regulation 3 sets the rate for shorn wool other than carpet wool at 8.5%, and section 3(4) maintains the rate for carpet wool at 4%. These changes are made under the authority of section 6 of the Wool Tax Acts (Nos 1-5) 1964, which allows the Governor-General to make regulations for the purposes of these Acts. The Acts themselves impose a tax on the sale value of shorn wool produced in Australia, with the tax being levied on specific dealings such as sales by wool brokers and purchases by registered wool dealers or manufacturers.
The obligations imposed by the Wool Tax Acts and the subsequent regulations are primarily on those who deal in shorn wool, including brokers, dealers, and manufacturers. These parties must adhere to the prescribed tax rates and ensure that the appropriate amount of tax is paid on the sale value of the wool. Additionally, the regulations require the Governor-General to consider recommendations from various bodies before setting the tax rate, such as the Australian Wool Realisation Commission, the Australian Wool Corporation, and the Wool Research and Development Corporation. The Governor-General is also required to take into account any views expressed by the Wool Council of Australia.
Failure to comply with the provisions of the Wool Tax Acts and the regulations may result in various penalties and consequences. While the explanatory statement does not explicitly detail the specific offences or penalties, it is reasonable to infer that non-compliance could lead to civil or criminal consequences, including fines or other legal actions. The exact nature and severity of these consequences would typically be governed by other provisions within the Wool Tax Acts or related legislation. The maximum penalties, if applicable, would depend on the specific breach and relevant legal frameworks.