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Indirect Tax Legislation Amendment Bill 2000

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M

1998-1999-2000

 

The Parliament of the

Commonwealth of Australia

 

HOUSE OF REPRESENTATIVES

 

 

 

Indirect Tax Legislation Amendment Bill 2000

 

 

(Amendments to be moved on behalf of the Government)

 

(1)     Clause 2, page 2 (lines 1 and 2), omit “Schedule 10 (other than item 1 of Schedule 10)”, substitute “Schedules 10 and 10A (other than item 5 of Schedule 10A),”.

[trading periods spanning midnight on 30 June 2000]

(2)     Clause 2, page 2 (line 4), after “10,”, insert “10A,”.

[GST religious groups]

(3)     Clause 2, page 2 (line 10), omit “14, 15 and 16”, substitute “13A to 16E”.

[phasing in of input tax credits on motor vehicles etc.]

(4)     Clause 2, page 2 (after line 17), at the end of the clause, add:

             (6)  Schedule 9A and item 5 of Schedule 10A commence immediately after the commencement of Part 3 of Schedule 1 to the A New Tax System (Indirect Tax and Consequential Amendments) Act (No. 2) 1999 .

             (7)  Item 16F of Schedule 11 commences immediately after the commencement of Part 2 of Schedule 11 to the A New Tax System (Indirect Tax and Consequential Amendments) Act (No. 2) 1999 .

[producer rebates; trading periods spanning midnight on 30 June 2000; motor homes and campervans]

(5)     Schedule 1, page 3 (after line 18), after item 1, insert:

1A  Section 9-39 (after table item 5)

Insert:

5A

GST religious groups

Division 49

[section 9-39—GST religious groups]

(6)     Schedule 1, page 3, after proposed new item 1A, insert:

1B  Section 11-99 (after table item 6)

Insert:

6A

GST religious groups

Division 49

[section 11-99—GST religious groups]

(7)     Schedule 1, page 3, after proposed new item 1B, insert:

1C  Section 17-99 (after table item 8)

Insert:

8A

GST religious groups

Division 49

[section 17-99—GST religious groups]

(8)     Schedule 1, page 3, after proposed new item 1C, insert:

1D  Section 19-99 (before table item 1)

Insert:

1A

GST religious groups

Division 49

[section 19-99—GST religious groups]

(9)     Schedule 1, page 3 (after line 24), after item 2, insert:

2A  Subsection 29-40(2)

Omit “or any * gift-deductible entity”, substitute “, any * gift-deductible entity or any * government school”.

[section 29-40—government schools]

(10)   Schedule 1, page 3, after proposed new item 2A, insert:

2B  Section 37-1 (after table item 15)

Insert:

15A

GST religious groups

Division 49

[section 37-1—GST religious groups]

(11)   Schedule 1, page 3, after proposed new item 2B, insert:

2C  Paragraphs 38-250(1)(a) and (2)(a)

Omit “or a * gift-deductible entity”, substitute “, a * gift-deductible entity or a * government school”.

[section 38-250—government schools]

(12)   Schedule 1, page 3, after proposed new item 2C, insert:

2D  Paragraph 38-255(a)

Omit “or a * gift-deductible entity”, substitute “, a * gift-deductible entity or a * government school”.

2E  Section 38-255

Omit “or gift-deductible entity” (wherever occurring), substitute “, gift-deductible entity or government school”.

[section 38-255—government schools]

(13)   Schedule 1, page 3, after proposed new item 2E, insert:

2F  Paragraph 38-270(a)

Omit “or a * gift-deductible entity”, substitute “, a * gift-deductible entity or a * government school”.

[section 38-270—government schools]

(14)   Schedule 1, page 3, after proposed new item 2F, insert:

2G  Paragraph 40-130(2)(a)

Repeal the paragraph.

[section 40-130—school tuckshops and canteens]

(15)   Schedule 1, item 3, page 4 (line 2), omit “or a * gift-deductible entity”, substitute “, a * gift-deductible entity or a * government school”.

[section 40-160—government schools]

(16)   Schedule 1, page 5 (after line 6), after item 4, insert:

4A  After Division 48

Insert:

Division 49 GST religious groups

Table of Subdivisions

49-A     Approval of GST religious groups

49-B      Consequences of approval of GST religious groups

49-C      Administrative matters

49-1   What this Division is about

Some registered charitable bodies can be approved as a GST religious group. Transactions between members of the group are then excluded from the GST.

Subdivision 49-A Approval of GST religious groups

49-5   Approval of GST religious groups

                   The Commissioner must approve 2 or more entities as a * GST religious group if:

                     (a)  the entities jointly apply, in the * approved form, for approval as a GST religious group; and

                     (b)  each of the entities * satisfies the membership requirements for that GST religious group; and

                     (c)  the application nominates one of the entities to be the * principal member for the group; and

                     (d)  the entity so nominated is an * Australian resident.

A group of entities that is so approved is a GST religious group .

Note:          Refusing an application for approval under this section is a reviewable GST decision (see Division 7 of Part VI of the Taxation Administration Act 1953 ).

49-10   Membership requirements of a GST religious group

                   An entity satisfies the membership requirements of a * GST religious group, or a proposed GST religious group, if:

                     (a)  the entity is * registered; and

                     (b)  the entity is endorsed as exempt from income tax under Subdivision 50-B of the * ITAA 1997; and

                     (c)  all the other members of the GST religious group or proposed GST religious group are so endorsed; and

                     (d)  the entity and all those other members are part of the same religious organisation; and

                     (e)  the entity is not a member of any other GST religious group.

Subdivision 49-B Consequences of approval of GST religious groups

49-30   Supplies between members of GST religious groups

             (1)  A supply that a * member of a * GST religious group makes to another member of the same GST religious group is treated as if it were not a * taxable supply.

             (2)  This section has effect despite section 9-5 (which is about what are taxable supplies).

49-35   Acquisitions between members of GST religious groups

             (1)  An acquisition that a * member of a * GST religious group makes from another member of the same GST religious group is treated as if it were not a * creditable acquisition.

             (2)  This section has effect despite section 11-5 (which is about what are creditable acquisitions).

49-40  Adjustment events

             (1)  An * adjustment event cannot arise in relation to:

                     (a)  a supply that a * member of a * GST religious group makes to another member of the same GST religious group; or

                     (b)  an acquisition that a member of a GST religious group makes from another member of the same GST religious group.

             (2)  This section has effect despite section 19-10 (which is about what are adjustment events).

49-45  Changes in the extent of creditable purpose

             (1)  An * adjustment cannot arise under Division 129 in relation to an acquisition that a * member of a * GST religious group makes from another member of the same GST religious group.

             (2)  This section has effect despite section 129-5 (which is about when adjustments can arise under Division 129).

49-50   GST religious groups treated as single entities for certain purposes

             (1)  Despite sections 49-35, 49-40 and 49-45, a * GST religious group is treated as a single entity, and not as a number of entities corresponding to the * members of the GST religious group, for the purposes of working out:

                     (a)  whether acquisitions or importations by a member are for a * creditable purpose; and

                     (b)  the amounts of any input tax credits to which the member is entitled; and

                     (c)  whether the member has any * adjustments; and

                     (d)  the amounts of any such adjustments.

             (2)  This section has effect despite section 11-25 (which is about the amount of input tax credits) and section 17-10 (which is about the effect of adjustments on net amounts).

Subdivision 49-C Administrative matters

49-70   Changing the membership etc. of GST religious groups

Changes made on application

             (1)  The Commissioner must, if the * principal member of a * GST religious group applies to the Commissioner in the * approved form, do one or more of these (as requested in the application):

                     (a)  approve, as an additional * member of the GST religious group, another entity that * satisfies the membership requirements for the GST religious group;

                     (b)  revoke the approval of one of the members of the GST religious group as a member of the group;

                     (c)  approve another member of the GST religious group to replace the applicant as the principal member of the group.

Note:          Refusing an application for approval or revocation under this subsection is a reviewable GST decision (see Division 7 of Part VI of the Taxation Administration Act 1953 ).

Changes made without application

             (2)  The Commissioner must revoke the approval of one of the * members of a * GST religious group if satisfied that the member does not * satisfy the membership requirements for the GST religious group.

Note:          Revoking under this subsection an approval under this Division is a reviewable GST decision (see Division 7 of Part VI of the Taxation Administration Act 1953 ).

49-75   Revoking the approval of GST religious groups

Revoking on application

             (1)  The Commissioner must, if the principal member of a * GST religious group applies to the Commissioner in the * approved form, revoke the approval of the group as a GST religious group.

Note:          Refusing an application for revocation under this subsection is a reviewable GST decision (see Division 7 of Part VI of the Taxation Administration Act 1953 ).

Revoking without application

             (2)  The Commissioner must revoke the approval of the * GST religious group if satisfied that none of its members, or only one of its members, * satisfies the membership requirements for that GST religious group.

Note:          Revoking under this subsection the approval of a GST group is a reviewable GST decision (see Division 7 of Part VI of the Taxation Administration Act 1953 ).

49-80   Notification by principal members

                   The principal member of a * GST religious group must notify the Commissioner of any circumstances under which the Commissioner must:

                     (a)  revoke the approval of one of the * members of the group under subsection 49-70(2); or

                     (b)  revoke the approval of the group under subsection 49-75(2).

The notification may (in appropriate cases) be in the form of an application under subsection 49-70(1) or 49-75(1). The notification, or application, must be given to the Commissioner within 21 days after the circumstances occurred.

49-85   Date of effect of approvals and revocations

             (1)  The Commissioner must decide the date of effect of any approval, or any revocation of an approval, under this Division.

             (2)  The date of effect may be the day of the decision, or a day before or after that day. However, it must be a day on which, for all the * members of the * GST religious group in question, a tax period begins.

Note:          Deciding under this section the date of effect of any approval, or any revocation of an approval, under this Division is a reviewable GST decision (see Division 7 of Part VI of the Taxation Administration Act 1953 ).

49-90   Notification by the Commissioner

                   The Commissioner must give notice of any decision that he or she makes under this Division:

                     (a)  if the decision relates to the approval of 2 or more entities as a * GST religious group—to the entity nominated in the application for approval to be the * principal member of the group; or

                     (b)  otherwise—to the principal member of the * GST religious group to which the decision relates.

[sections 49-1 to 49-90—GST religious groups]

(17)   Schedule 1, page 5, after proposed new item 4A, insert:

4B  Paragraph 63-5(2)(a)

Omit “or a * gift-deductible entity”, substitute “, a * gift-deductible entity or a * government school”.

[section 63-5—government schools]

(18)   Schedule 1, item 6, page 5 (line 25), after “charitable bodies”, insert “and government schools”.

[section 111-1—government schools]

(19)   Schedule 1, item 7, page 6 (lines 1 and 2), omit “or a * gift-deductible entity”, substitute “, a * gift-deductible entity or a * government school”.

[section 111-18—government schools]

(20)   Schedule 1, item 7, page 6 (line 5), omit “or gift-deductible entity”, substitute “, gift-deductible entity or government school”.

[section 111-18—government schools]

(21)   Schedule 1, item 7, page 6 (lines 6 and 7), omit “or gift-deductible entity”, substitute “, gift-deductible entity or government school”.

[section 111-18—government schools]

(22)   Schedule 1, item 7, page 6 (lines 8 and 9), omit “or gift-deductible entity”, substitute “, gift-deductible entity or government school”.

[section 111-18—government schools]

(23)   Schedule 1, page 6 (after line 11), after item 7, insert:

7A  Section 195-1 (note at the end of the definition of creditable acquisition )

After “sections”, insert “49-35,”.

[section 195-1—GST religious groups]

(24)   Schedule 1, page 6 (after line 14), after item 8, insert:

8A  Section 195-1

Insert:

government school means a * school that:

                     (a)  supplies any of these kinds of * education courses:

                              (i)  * pre-school courses;

                             (ii)  full-time * primary courses;

                            (iii)  full-time * secondary courses;

                            (whether or not the school supplies any other education courses); and

                     (b)  is conducted by or on behalf of an * Australian government agency;

and includes a proposed school that will meet the requirements of paragraphs (a) and (b) once it starts operation.

8B  Section 195-1

Insert:

GST religious group has the meaning given by section 49-5.

8C  Section 195-1 (definition of member )

Repeal the definition, substitute:

member means:

                     (a)  in relation to a * GST group—an entity, a * non-profit sub-entity or a * government related entity currently approved as one of the members of the group under section 48-5 or paragraph 48-70(1)(a); or

                     (b)  in relation to a * GST religious group—an entity currently approved as one of the members of the group under section 49-5 or paragraph 49-70(1)(a).

8D  Section 195-1

Insert:

principal member , for a * GST religious group, is the * member of the group nominated as mentioned in paragraph 49-5(c), or approved as a replacement principal member for the group under paragraph 49-70(1)(c).

8E  Section 195-1 (definition of satisfies the membership requirements )

Repeal the definition, substitute:

satisfies the membership requirements :

                     (a)  in relation to a * GST group—has the meaning given by section 48-10 or 149-25; or

                     (b)  in relation to a * GST religious group—has the meaning given by section 49-10.

8F  Section 195-1 (note at the end of the definition of taxable supply )

After “sections”, insert “49-30,”.

[section 195-1—government schools; GST religious groups]

(25)   Schedule 1, page 6 (after line 20), after item 10, insert:

10A  Subsection 62(2) (after table item 24)

Insert:

24A

refusing an application for approval

section 49-5

24B

refusing an application for approval or revocation

subsection 49-70(1)

24C

revoking an approval under Division 49

subsection 49-70(2)

24D

refusing an application for revocation

subsection 49-75(1)

24E

revoking the approval of a GST religious group

subsection 49-75(2)

24F

deciding the date of effect of any approval, or any revocation of an approval, under Division 49

section 49-85

[section 62—GST religious groups]

(26)   Schedule 2, page 8 (after line 5), after item 4, insert:

4A  Section 38-415

Repeal the section, substitute:

38-415   Supplies through inwards duty free shops

                   A supply is GST-free if the supply is a sale of * airport shop goods through an * inwards duty free shop to a * relevant traveller.

[section 38-415—inwards duty free shops]

(27)   Schedule 2, page 8 (after line 21), at the end of the Schedule, add:

8  Section 195-1 (paragraph (b) of the definition of relevant traveller )

Omit “imported or * excisable goods”, substitute “ * airport shop goods”.

[section 195-1—inwards duty free shops]

(28)   Schedule 3, item 7, page 10 (lines 4 to 7), omit the item.

[section 38-190—GST-free exports]

(29)   Schedule 3, item 11, page 10 (line 19), omit “not”.

[technical correction]

(30)   Schedule 5, page 20 (after line 16), after item 2, insert:

2A  Section 11-99 (after table item 3)

Insert:

3A

Financial supplies (acquisitions and importations to provide fringe benefits)

Division 71

[section 11-99—interaction with fringe benefits tax]

(31)   Schedule 5, item 4, page 20 (line 22), omit “acquisition”, substitute “importation”.

[section 15-10—financial supplies]

(32)   Schedule 5, item 4, page 20 (line 25), omit “acquisition”, substitute “importation”.

[section 15-10—financial supplies]

(33)   Schedule 5, page 20 (after line 28), after item 4, insert:

4A  Section 15-99 (before table item 1)

Insert:

1A

Financial supplies (acquisitions and importations to provide fringe benefits)

Division 71

[section 15-99—interaction with fringe benefits tax]

(34)   Schedule 5, page 20, after proposed new item 4A, insert:

4B  Section 37-1 (before table item 11)

Insert:

10B

Financial supplies (acquisitions and importations to provide fringe benefits)

Division 71

[section 37-1—interaction with fringe benefits tax]

(35)   Schedule 5, page 21 (after line 5), after item 5, insert:

5A  After Division 70

Insert:

Division 71 Financial supplies (acquisitions and importations to provide fringe benefits)

 

71-1   What this Division is about

Financial suppliers may not be entitled to input tax credits for acquisitions or importations they make to provide fringe benefits to their employees.

Note:          Under the Fringe Benefits Tax Assessment Act 1986 , a lower rate of fringe benefits tax is payable for providing fringe benefits without entitlement to input tax credits.

71-5  Acquisitions by financial suppliers to provide fringe benefits

             (1)  An acquisition that solely or partly relates to making * financial supplies is not a * creditable acquisition to the extent that you make the acquisition for the purpose of providing * fringe benefits.

             (2)  However, this section applies only if you * exceed the financial acquisitions threshold.

             (3)  This section has effect despite section 11-5 (which is about what is a creditable acquisition).

71-10  Importations by financial suppliers to provide fringe benefits

             (1)  An importation that solely or partly relates to making * financial supplies is not a * creditable importation to the extent that you make the importation for the purpose of providing * fringe benefits.

             (2)  However, this section applies only if you * exceed the financial acquisitions threshold.

             (3)  This section has effect despite section 15-5 (which is about what is a creditable importation).

[sections 71-1 to 71-10—interaction with fringe benefits tax]

(36)   Page 42 (after line 6), after Schedule 9, insert:

Schedule 9A Producer rebates under the wine equalisation tax

   

A New Tax System (Wine Equalisation Tax) Act 1999

1  At the end of section 17-1

Add “Producer rebates under Division 19 are a form of wine tax credit.”.

2  Section 17-5 (after table item CR8)

Insert:

CR9

* Producer rebate

You make an * assessable dealing in circumstances that entitle you to a * producer rebate under Division 19.

the amount of the * producer rebate under Division 19

immediately before the end of the financial year in which the * assessable dealing occurs

3  After Division 17

Insert:

Division 19 Producer rebates

   

19-1   What this Division is about

Wine producers are entitled to a rebate for certain retail sales and AOUs of wine. The rebate tapers off when these sales and AOUs exceed a particular value. The rebate is provided in the form of a wine tax credit.

Note:          Credit ground CR9 is producer rebates.

19-5   Entitlement to producer rebates

Retail sales

             (1)  You are entitled to a * producer rebate for * rebatable wine in respect of a * financial year if:

                     (a)  you are the * producer of the wine; and

                     (b)  you are liable to wine tax for a * retail sale of the wine during the financial year; and

                     (c)  the sale is from premises to which your * producer’s licence relates; and

                     (d)  the sale does not contravene the * State law or * Territory law under which the licence was issued, or any conditions to which the licence is subject.

             (2)  A sale of wine by mail order or on the Internet is taken to be a sale from particular premises for the purposes of paragraph (1)(c) if the wine is sold under the * producer’s licence to which those premises relate.

AOUs

             (3)  You are also entitled to a * producer rebate for * rebatable wine in respect of a * financial year if:

                     (a)  you are the * producer of the wine; and

                     (b)  you are liable to wine tax for an * AOU of the wine during the financial year.

Exceptions

             (4)  However, you are not entitled to the rebate for the wine if:

                     (a)  in the case of a * retail sale—you sell the wine in the course of providing, to the purchaser of the wine, other * food that is for consumption on the * premises from which it is supplied; or

                     (b)  in the case of a retail sale—the sale is by mail order or on the Internet and a commission is payable to a third party for the sale, or a third party deducts an amount as commission from the proceeds of the sale; or

                     (c)  in any case—in the * financial year in which the sale or * AOU occurs, your * annual rebatable turnover for the * producer’s licence under which the sale or AOU took place is more than $580,000.

19-10   Amount of producer rebates

             (1)  If the * annual rebatable turnover of a * producer of * rebatable wine for a particular * producer’s licence in a * financial year is $300,000 or less, the amount of the * producer rebates to which you are entitled in respect of that licence for that financial year is 14% of that turnover.

             (2)  If the * annual rebatable turnover of a * producer of * rebatable wine for a particular * producer’s licence in a * financial year is more than $30 0,0 00, the amount of the * producer rebates to which you are entitled in respect of that licence for that financial year is:

19-15   Estimating amounts of producer rebates for each tax period

             (1)  The Commissioner may determine in writing how a * producer of * rebatable wine may work out estimates of amounts of * producer rebates that the producer may claim for the producer’s * tax periods during a * financial year (other than the last tax period of a financial year).

             (2)  An amount worked out in accordance with the determination, for one of the * tax periods applying to you, is treated as an amount of a * wine tax credit:

                     (a)  to which you are entitled; and

                     (b)  that arises during that tax period (even though under section 17-5 it would arise at a later time).

             (3)  The amount of the * producer rebate to which you are entitled in respect of the * financial year is taken to be reduced by the sum of the amounts worked out under subsection (2) that you claim for * tax periods during the financial year.

             (4)  However, if the sum of the amounts worked out under subsection (2) that you claim for * tax periods during the * financial year exceeds the amount of the * producer rebate to which you are entitled in respect of the financial year:

                     (a)  you are liable to pay an amount equal to that excess; and

                     (b)  the amount is to be treated as if it were wine tax payable by you at the end of the financial year, and, for the purposes of Part 5, were attributable to the last tax period of the financial year.

19-20   Annual rebatable turnover

                   The * annual rebatable turnover of a * producer of * rebatable wine for a particular * producer’s licence in a * financial year is the sum of:

                     (a)  the * notional wholesale selling prices of all * retail sales of rebatable wine the producer makes in that financial year that are sales:

                              (i)  made under the licence; and

                             (ii)  to which subsection 19-5(1) applies; and

                     (b)  the notional wholesale selling prices of all * AOUs of rebatable wine the producer makes in that financial year that are AOUs:

                              (i)  made under the licence; and

                             (ii)  to which subsection 19-5(3) applies.

4  Section 33-1

Insert:

annual rebatable turnover has the meaning given by section 19-20.

5  Section 33-1

Insert:

financial year means a period of 12 months beginning on 1 July.

6  Section 33-1

Insert:

food has the meaning given by section 38-4 of the * GST Act.

7  Section 33-1

Insert:

ITAA 1997 means the Income Tax Assessment Act 1997 .

8  Section 33-1

Insert:

premises , in relation to a supply of * food (other than wine), has the meaning given by section 38-5 of the * GST Act.

9  Section 33-1

Insert:

producer , of * rebatable wine, means an entity that:

                     (a)  * manufactures the wine, or supplies to another entity the grapes, other fruit, vegetables or honey from which the wine is manufactured; and

                     (b)  holds a * producer’s licence.

10  Section 33-1

Insert:

producer rebate means a rebate to which a * producer of * rebatable wine is entitled under Division 19.

11  Section 33-1

Insert:

producer’s licence means a licence, issued under a * State law or a * Territory law, to make * retail sales of wine from particular premises:

                     (a)  as a wine producer or a vigneron; or

                     (b)  in a similar capacity determined in writing by the Commissioner.

12  Section 33-1

Insert:

rebatable wine means * grape wine, * grape wine products, * fruit or vegetable wine or * mead.

13  Section 33-1

Insert:

State law has the meaning given by section 995-1 of the * ITAA 1997.

14  Section 33-1

Insert:

Territory law has the meaning given by section 995-1 of the * ITAA 1997.

[sections 17-1 to 33-1—producer rebates]

(37)   Schedule 10, heading to the Schedule, page 43 (lines 2 and 3), omit the heading, substitute:

Schedule 10 Alcoholic beverages

   

[alcoholic beverages]

(38)   Schedule 10, page 43 (before line 5), before item 1, insert:

A New Tax System (Goods and Services Tax Transition) Act 1999

1A  After section 16A

Insert:

16AB   Special GST credit for certain alcoholic beverages on which duty has decreased

             (1)  This section applies to goods if:

                     (a)  you are entitled to a special credit under section 16 in respect of the goods; and

                     (b)  they are goods mentioned in subsection 15A(1) (alcoholic beverages) of the Sales Tax (Exemptions and Classifications) Act 1992 ; and

                     (c)  either:

                              (i)  an amount of excise duty or customs duty (the old duty amount ) in respect of the goods was paid before 1 July 2000; or

                             (ii)  the goods were delivered into home consumption before 1 July 2000 under a permission given under subsection 61C(1) of the Excise Act 1901 or granted under subsection 69(3) of the Customs Act 1901 , and an amount of excise duty or customs duty (the old duty amount ) was or is payable in respect of the goods; and

                     (d)  were excise duty or customs duty (whichever is applicable) instead to become payable on the goods immediately after 1 July 2000, the amount of that duty (the new duty amount ) would be less than the old duty amount.

             (2)  The amount of the special credit in respect of the goods is increased by an amount equal to the difference between the old duty amount and the new duty amount.

[section 16AB—alcoholic beverages]

(39)   Schedule 10, page 43, after proposed new item 1A, insert:

1B  Paragraph 16B(1)(d)

Omit “immediately after”, substitute “at the start of”.

[section 16B—alcoholic beverages]

(40)   Page 45, after Schedule 10, insert:

Schedule 10A —Trading periods spanning midnight on 30 June 2000

   

A New Tax System (End of Sales Tax) Act 1999

1  After subsection 3(1)

Insert:

          (1A)  However, if the assessable dealing is in respect of a supply to which section 6A of the A New Tax System (Goods and Services Tax Transition) Act 1999 applies, this section does not apply unless the time of dealing is after the end of the transition trading period (within the meaning of that section).

A New Tax System (Goods and Services Tax Transition) Act 1999

2  At the end of Part 1

Add:

6A  Trading periods spanning midnight on 30 June 2000

             (1)  Despite section 6, if:

                     (a)  an entity has chosen to apply this section; and

                     (b)  the entity makes a supply that, under section 6, would be taken to be made on 1 July 2000 but before:

                              (i)  6 am on that day; or

                             (ii)  if the entity has chosen to stop the application of this section at an earlier time on that day—the time so chosen; and

                     (c)  the part of the entity’s enterprise through which the supply is made was open for business both immediately before 1 July 2000 and immediately after 30 June 2000; and

                     (d)  that part of the entity’s enterprise remains open for business during 1 July 2000 until at least the time at which, under section 6, the supply would be taken to be made;

the supply, and the acquisition made by the recipient of the supply, is taken, for the purposes of this Act, to be made immediately before 1 July 2000.

             (2)  If an entity makes a supply to which subsection (1) applies, then, in relation to that supply:

                     (a)  section 12 has effect as if the reference in paragraph 12(1)(b) to a period that begins before 1 July 2000 and ends on or after 1 July 2000 were a reference to a period that begins before the end of the transition trading period and ends on or after the end of the transition trading period; and

                     (b)  Part 4 has effect as if references to having goods on hand at the start of 1 July 2000 were references to having goods on hand immediately after the end of the transition trading period; and

                     (c)  subsection 16(3A) has effect as if the reference to the amount of sales tax borne changing after 1 July 2000 were a reference to that amount changing after the end of the transition trading period; and

                     (d)  paragraph 17(1)(b) has effect as if the reference to applying the goods on or after 1 July 2000 were a reference to applying the goods after the end of the transition trading period; and

                     (e)  paragraph 17(3)(b) has effect as if the reference to ceasing to be registered on or after 1 July 2000 were a reference to ceasing to be registered after the end of the transition trading period; and

                      (f)  section 24 has effect as if:

                              (i)  the reference to making gambling supplies before 1 July 2000 were a reference to making gambling supplies before the end of the transition trading period; and

                             (ii)  the reference to a gambling event happening on or after 1 July 2000 were a reference to a gambling event happening on or after the end of the transition trading period; and

                            (iii)  the references to gambling events that happened before 1 July 2000 were references to gambling events that happened before the end of the transition trading period; and

                     (g)  section 24A has effect as if the references to vouchers supplied before, not redeemed before, or supplied after, 1 July 2000 were references to vouchers supplied before, not redeemed before, or supplied after, the end of the transition trading period (as the case requires).

             (3)  This section does not apply if, but for this section, the supply would be input taxed.

             (4)  In this section:

transition trading period means the period ending:

                     (a)  at the first time after 30 June 2000 that the part of the entity’s enterprise through which the supply in question was made was not open for business; or

                     (b)  at:

                              (i)  6 am on 1 July 2000; or

                             (ii)  if the entity has chosen to stop the application of this section at an earlier time on that day—the time so chosen;

whichever occurs sooner.

3  At the end of subsection 7(1)

Add:

Note:          GST may not apply to supplies during trading periods spanning midnight on 30 June 2000: see section 6A.

4  At the end of subsection 8(1)

Add:

Note 3:       Sales tax may still apply to supplies during trading periods spanning midnight on 30 June 2000: see section 6A.

A New Tax System (Wine Equalisation Tax and Luxury Car Tax Transition) Act 1999

5  After subsection 3(2)

Insert:

          (2A)  This section applies to wine that is the subject of a supply to which section 6A of the A New Tax System (Goods and Services Tax Transition) Act 1999 applies as if the reference in paragraph (1)(b) of this section to having wine on hand at the start of 1 July 2000 were a reference to having wine on hand immediately after the end of the transition trading period (within the meaning of that section).

[section 3, sections 6A to 8 and section 3—trading periods spanning midnight on 30 June 2000]

(41)   Schedule 11, page 46 (after line 11), after item 2, insert:

2A  Paragraph 38(2)(c)

After “all”, insert “or most of”.

2B  Subsection 38(3) (added by the A New Tax System (Indirect Tax and Consequential Amendments) Act (No. 2) 1999 )

Repeal the subsection, insert (after subsection (2)):

          (2A)  For the avoidance of doubt, the fact that activities of an entity are limited to making supplies to members of the entity does not prevent those activities:

                     (a)  being in the form of a * business within the meaning of paragraph (1)(a); or

                     (b)  being in the form of an adventure or concern in the nature of trade within the meaning of paragraph (1)(b).

Note:       In addition to making other changes, item 2B corrects the incorrect numbering and location of this subsection by the A New Tax System (Indirect Tax and Consequential Amendments) Act (No. 2) 1999 .

[section 38—partnerships; mutual organisations]

(42)   Schedule 11, page 46 (after line 22), after item 3, insert:

3A  Subsection 9-15(2B)

Omit “a body” (wherever occurring), substitute “an entity”.

[section 9-15—mutual organisations]

(43)   Schedule 11, page 46, after proposed new item 3A, insert:

3B  After paragraph 9-20(1)(d)

Insert:

                   (da)  by a trustee of a * complying superannuation fund or, if there is no trustee of the fund, by a person who manages the fund; or

3C  Paragraph 9-20(2)(c)

After “all”, insert “or most of”.

3D  Subsection 9-20(3)

Repeal the subsection, insert (after subsection (2)):

             (3)  For the avoidance of doubt, the fact that activities of an entity are limited to making supplies to members of the entity does not prevent those activities:

                     (a)  being in the form of a * business within the meaning of paragraph (1)(a); or

                     (b)  being in the form of an adventure or concern in the nature of trade within the meaning of paragraph (1)(b).

Note:       In addition to making other changes, item 3D corrects the incorrect location of this subsection by the A New Tax System (Indirect Tax and Consequential Amendments) Act (No. 2) 1999 .

[section 9-20—complying superannuation funds; partnerships; mutual organisations]

(44)   Schedule 11, page 46 (after line 24), after item 4, insert:

4A  Section 9-80

Omit “(worked out as if it were solely a taxable supply)”.

4B  At the end of section 9-80

Add:

             (2)  The value of the actual supply, for the purposes of subsection (1), is as follows:

where:

taxable proportion is the proportion of the value of the actual supply that represents the value of the * taxable supply (expressed as a number between 0 and 1).

[section 9-80—valuing mixed supplies]

(45)   Schedule 11, page 46, after proposed new item 4B, insert:

4C  Section 15-99 (after table item 2)

Insert:

2AA

Importations without entry for home consumption

Division 114

[section 15-99—imported goods supplied in bond]

(46)   Schedule 11, page 46, after proposed new item 4C, insert:

4D  Section 17-99 (after table item 4)

Insert:

4A

Distributions from deceased estates

Division 139

[section 17-99—deceased estates]

(47)   Schedule 11, page 46, after proposed new item 4D, insert:

4E  Section 29-39 (after table item 8)

Insert:

8A

Distributions from deceased estates

Division 139

[section 29-39—deceased estates]

(48)   Schedule 11, page 47 (after line 5), after item 6, insert:

6A  Section 37-1 (after table item 10)

Insert:

10A

Distributions from deceased estates

Division 139

[section 37-1—deceased estates]

(49)   Schedule 11, item 8, page 47 (line 15), omit “sale”, substitute “supply”.

[technical correction]

(50)   Schedule 11, page 47 (after line 19), after item 8, insert:

8A  Subsection 42-5(1B)

Repeal the subsection.

[section 42-5—reimported goods]

(51)   Schedule 11, page 47, after proposed new item 8A, insert:

8B  At the end of Division 42

Add:

42-10  Goods returned to Australia in an unaltered condition

                   An importation of goods is a non-taxable importation if:

                     (a)  the goods were exported from Australia and are returned to Australia, without having been subject to any treatment, industrial processing, repair, renovation, alteration or any other process since their export; and

                     (b)  the importer was not entitled to, and did not claim, a payment under Division 168 (about the tourist refund scheme) related to the export of the goods; and

                     (c)  the importer:

                              (i)  is the manufacturer of the goods; or

                             (ii)  has previously acquired the goods, and the supply by means of which the importer acquired the goods was a * taxable supply (or would have been a taxable supply but for section 66-45); or

                            (iii)  has previously imported the goods, and the previous importation was a * taxable importation in respect of which the GST was paid.

Note:          An importation covered by this section may also be duty-free under item 17 of Schedule 4 to the Customs Tariff Act 1995 .

[section 42-10—reimported goods]

(52)   Schedule 11, page 49, (after line 13), after item 11, insert:

11A  After subsection 111-5(3)

Insert:

          (3A)  If you are a * partnership, this section does not apply to your reimbursement of a partner for an expense he or she incurs if, even without this Division applying, you are entitled to an input tax credit arising from the incurring of the expense.

[section 111-5—reimbursement of partners]

(53)   Schedule 11, page 49, after proposed new item 11A, insert:

11B  At the end of Division 111

Add:

111-25  Employers paying work-related expenses of employees

                   If you make, or are liable to make, a payment on behalf of your employee for an expense that he or she incurs that is related directly to his or her activities as your employee, this Division applies to you as if you reimbursed your employee for the expense.

[section 111-25—employers paying work-related expenses of employees]

(54)   Schedule 11, page 49, after proposed new item 11B, insert:

11C  At the end of section 114-1

Add “An entity that enters for home consumption warehoused goods imported by someone else is entitled to any input tax credit for the importation.”.

[section 114-1—imported goods supplied in bond]

(55)   Schedule 11, page 49, after proposed new item 11C, insert:

11D  At the end of Division 114

Add:

114-25  Warehoused goods entered for home consumption by an entity other than the importer

             (1)  If you enter for home consumption (within the meaning of the Customs Act 1901 ) goods that are warehoused goods (within the meaning of that Act) and that were imported by another person:

                     (a)  you are treated, for the purposes of Division 15, as having imported the goods; and

                     (b)  the extent (if any) to which you entered the goods for home consumption for a * creditable purpose is treated as the extent (if any) to which you imported the goods for a creditable purpose.

             (2)  This section has effect despite Division 15 (which is about creditable importations).

[section 114-25—imported goods supplied in bond]

(56)   Schedule 11, page 49, after proposed new item 11D, insert:

11E  At the end of section 129-25

Add:

             (3)  This section does not apply to a disposal if this Division continues to apply to the acquisition or importation of the thing because of subsection 138-17(2).

[section 129-25—deceased estates]

(57)   Schedule 11, page 49, after proposed new item 11E, insert:

11F  After section 138-15

Insert:

138-17  Situations to which this Division does not apply

             (1)  This Division does not apply to anything included in the assets of an entity whose * registration is cancelled, to the extent that the thing relates to an * enterprise that the entity * carried on before the cancellation, if:

                     (a)  the cancellation arises as a result of the death of the entity, and the executor or trustee of the deceased estate:

                              (i)  is registered or is * required to be registered; and

                             (ii)  continues, immediately after the cancellation, to carry on that enterprise; or

                     (b)  the cancellation arises as a result of the executor or trustee of a deceased estate ceasing to carry on any enterprise, and one or more beneficiaries of the deceased estate:

                              (i)  are registered or is * required to be registered; and

                             (ii)  continue, immediately after the cancellation, to carry on the enterprise that the deceased had carried on.

             (2)  Division 129 (which is about changes in the extent of creditable purpose) continues to apply to the acquisition or importation of the thing immediately after the cancellation if:

                     (a)  Subdivision 129-A does not prevent an adjustment arising under that Division for the acquisition or importation; and

                     (b)  the cancellation occurs during an * adjustment period for the acquisition or importation.

             (3)  For the purposes of applying Division 129 to the acquisition or importation after the cancellation:

                     (a)  the entity * carrying on the * enterprise in question immediately after the cancellation is taken to have made the acquisition or importation at the time it was originally made; and

                     (b)  the extent (if any) to which the thing was originally acquired or imported for a * creditable purpose is taken to be the extent (if any) to which the entity acquired or imported the thing for a creditable purpose; and

                     (c)  any * application of the thing since the original acquisition or importation is taken to be an application of the thing by the entity.

[section 138-17—deceased estates]

(58)   Schedule 11, page 49, after proposed new item 11F, insert:

11G  Section 138-20

After “This Division”, insert “(except subsections 138-17(2)and (3))”.

[section 138-20—deceased estates]

(59)   Schedule 11, page 49, after proposed new item 11G, insert:

11H  After Division 138 of Part 2

Insert:

Division 139 —Distributions from deceased estates

 

139-1   What this Division is about

Distributions from deceased estates, for private consumption, that are not taxable supplies may involve disposing of assets that were acquired or imported in circumstances giving rise to entitlements to input tax credits. This Division provides for an increasing adjustment to cancel those input tax credits.

139-5   Adjustments for distributions from deceased estates

             (1)  You have an increasing adjustment if:

                     (a)  you are the executor or trustee of a deceased estate; and

                     (b)  you are * registered or * required to be registered; and

                     (c)  you supply an asset of the deceased estate to a beneficiary of the deceased estate; and

                     (d)  the supply is not a * taxable supply and is not a supply that is * GST-free or * input taxed; and

                     (e)  you were, or are, or the deceased person was, entitled to an input tax credit for the deceased person’s acquisition or importation of the asset.

Note:          Increasing adjustments increase your net amounts.

             (2)  The amount of the adjustment, for the asset, is as follows:

where:

applicable value is:

                     (a)  the * GST inclusive market value of the asset immediately before it is supplied; or

                     (b)  if you were, or are, or the deceased person was, entitled to an input tax credit for the deceased person acquiring the thing—the amount of the * consideration that you or the deceased person provided, or was liable to provide, for the acquisition of the thing, but only if the amount is less than that value; or

                     (c)  if you were, or are, or the deceased person was, entitled to an input tax credit for the deceased person importing the thing—the cost to you or the deceased person of acquiring or producing the thing (plus the GST paid on its importation), but only if the amount is less than that value.

             (3)  However, an * adjustment does not arise under this section in respect of the asset if:

                     (a)  the asset related to an * enterprise that the deceased person * carried on, and the beneficiary intends to continue to carry on that enterprise; or

                     (b)  there were one or more * adjustment periods for the deceased person’s acquisition or importation of the asset, and the last of those adjustment periods has ended before the cancellation of your * registration takes effect.

139-10  Attributing adjustments for distributions from deceased estates

             (1)  An * adjustment that you have under this Division is attributable to the tax period in which it arises.

             (2)  This section has effect despite section 29-20 (which is about attributing your adjustments).

139-15   Application of Division 129

                   This Division does not affect the operation of Division 129 (which is about changes in the extent of creditable purpose).

[sections 139-1 to 139-15—deceased estates]

(60)   Schedule 11, page 49 (after line 23), after item 12, insert:

12A  Section 195-1

Insert:

complying superannuation fund has the meaning given by section 995-1 of the * ITAA 1997.

12B  Section 195-1 (after table item 8 of the definition of increasing adjustment )

Insert:

 

8A

Section 139-5

Distributions from deceased estates

[section 195-1—complying superannuation funds; deceased estates]

(61)   Schedule 11, page 49 (after line 28), before item 14, insert:

13A  Section 5 (after table item 3)

Insert:

 

3AA

eligible short-term lease

Sales Tax Assessment Act 1992

[section 5—phasing in of input tax credits on motor vehicles etc.]

(62)   Schedule 11, page 50 (after line 10), after item 16, insert:

16A  Subsection 20(1)

Omit “or importation”, substitute “by way of purchase (including hire purchase), or importation,”.

16B  Paragraph 20(3A)(c)

Omit “subsection (2) or (3)”, substitute “subsection (2), (3) or (4B)”.

16C  After subsection 20(4)

Insert:

          (4A)  Paragraph (4)(c) does not apply to a dealing in respect of the acquisition or importation if the acquisition or importation is made with the intention of granting an eligible short-term lease in respect of the motor vehicle, trailer or body.

          (4B)  Neither subsection (2) nor subsection (3) applies if you make the acquisition or importation before 1 July 2002 with the intention of granting an eligible short-term lease. However, the amount of any input tax credit you are entitled to on the acquisition or importation is reduced by an amount equal to:

where:

exempt percentage is the exempt percentage specified in the agreement under subsection 15A(2) of the Sales Tax Assessment Act 1992 that applies to the eligible short-term lease in question.

original input tax credit is:

                     (a)  if you make the acquisition or importation before 1 July 2001—the amount that would (but for this section) be the amount of the input tax credit on the acquisition or importation; or

                     (b)  if you make the acquisition or importation on or after 1 July 2001 but before 1 July 2002—half that amount.

          (4C)  Agreements may be made under subsection 15A(2) of the Sales Tax Assessment Act 1992 , on or after 1 July 2000 but before 1 July 2002, as if:

                     (a)  sales tax had not been ended by the A New Tax System (End of Sales Tax) Act 1999 and by section 8 of this Act; and

                     (b)  the reference in subsection 15A(2) of the Sales Tax Assessment Act 1992 to a use of goods to satisfy one or more exemption Items were a reference to a use of goods that would have satisfied one or more exemption Items.

16D  Subsection 20(6)

Omit “this section”, substitute “subsection (3)”.

16E  At the end of section 20

Add:

             (7)  If an input tax credit to which you are entitled is reduced under subsection (4B), then, for the purposes of applying section 21-15 or 21-20 of the GST Act (where relevant), the amount of any adjustment under that section is reduced by the same proportion (before any application of Division 136 of that Act).

[section 20—phasing in of input tax credits on motor vehicles etc.]

(63)   Schedule 11, page 50, after proposed new item 16E, insert:

A New Tax System (Luxury Car Tax) Act 1999

16F  Section 27-1 (at the end of the definition of car )

Add:

               ; or (c)  a motor home, campervan or similar motor vehicle.

[section 27-1—motor homes and campervans]

(64)   Schedule 11, page 50, after proposed new item 16F, insert:

Customs Act 1901

16G  Subsection 71(2)

Omit “subsection (1)”, substitute “paragraph 68(1)(d), (e), (f) or (i)”.

[section 71—low value importations]

(65)   Schedule 11, page 50, after proposed new item 16G, insert:

16H  At the end of section 132

Add:

             (5)  The rate of any import duty on goods:

                     (a)  that are goods of a kind referred to in paragraph 68(1)(e); and

                     (b)  whose owner is not required by section 71 to provide information about them;

is the rate of duty in force at the time when the goods arrive in Australia.

[section 132—low value importations]

(66)   Schedule 11, page 50, after proposed new item 16H, insert:

16I  Subsection 132AA(1) (at the end of the table)

Add:

 

4

Goods of a kind referred to in paragraph 68(1)(e) that are not covered by item 3

Time of delivery of the goods into home consumption

[section 132AA—low value importations]