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Wednesday, 24 June 1998
Page: 3951


Senator COLSTON —My question is directed to Senator Kemp, the Assistant Treasurer. Is the minister aware of concerns such as those raised by the Gold Coast City Council relating to the coalition's amendment of item 192 of the Sales Tax (Exemptions and Classifications) Act 1992? Is it correct that this amendment will significantly impact on the financial viability of many local councils' community based business activities? Further, is it also the case that ratepayers around the nation will be able to thank the coalition for increased fees for important community services such as public swimming pools, community halls, public sporting complexes and camping grounds that will result from this amendment? Is this an example of the government balancing its own budget by passing on additional costs to the community?


Senator KEMP (Assistant Treasurer) —Senator Colston, I am aware of the issue that you have raised in particular, because this is a matter that you have be concerned about on previous occasions. In fact, if I recall, you also wrote to me on this particular matter. Senator Colston referred to section 192. The exemption provided by section 192 was being used in an unintended manner, with some part of the benefits at least going to the private sector through the development and refurbishment of projects such as shopping centres, hotels, casinos and apartment blocks. The government is aware that a Senate select committee either had or is holding an inquiry into this amendment.

Senator Colston, the specific issue which you raise, and which I think you have raised with me by correspondence before, relates to the effect on local councils. The amendment contains two tests in relation to the use of property. The property must be occupied by what is termed an always exempt person or, alternatively, principally by a person who is providing services to an always exempt person. In the latter case, the property must be used principally for the provision of those services.

The amendment referred to by Senator Colston includes a list of the types of properties which will be excluded from exemption regardless of whether they will be able to satisfy either of those two tests. In relation to Senator Colston's comments regarding local council facilities, I can advise him that local council facilities such as swimming pools, community halls and such things as entertainment venues would continue to qualify for an exemption where they are operated by a local council. Where these facilities are controlled and operated by a private agent, exemption may still apply if the arrangement is such that the private agent is providing a service to the local council. As I said, this is a matter which Senator Colston has shown some particular interest in before, and I think that he will be pleased with the answer that I have given. I certainly hope he will be.