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Radiocommunications (Transmitter Licence Tax) Amendment Bill 2002

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2002

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

 

 

 

 

 

 

RADIOCOMMUNICATIONS (TRANSMITTER LICENCE TAX) AMENDMENT BILL 2002

 

 

 

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

 

 

 

(Circulated by authority of the Minister for

Communications,  Information Technology and the Arts,

Senator the Hon. Richard Alston)

 

 

 



 

RADIOCOMMUNICATIONS (TRANSMITTER LICENCE TAX) AMENDMENT BILL 2002

 

OUTLINE

 

The Radiocommunications (Transmitter Licence Tax) Amendment Bill 200 2 (the Bill) provides for the correction of an anomaly in the Radiocommunications (Transmitter Licence Tax) Act 1983 (the Act) in relation to the imposition of tax on a transmitter licence which does not involve a person applying for the licence.

 

Commercial and community broadcasters are required to hold a licence under both the Broadcasting Services Act 1992 (BSA) and the Radiocommunications Act 1992 .  The broadcasting licence provides the mechanism to control the content of the broadcast and a radiocommunications licence or transmitter licence the technical provision for delivery of the medium.

 

If a broadcasting licence is allocated to a person under Part 4 (commercial television and radio broadcasting licences) or Part 6 (community broadcasting licences) of the BSA, the Australian Communications Authority (ACA) must issue to that person a transmitter licence under section 102 of the Radiocommunications Act for transmitting the broadcasting service.  This occurs by virtue of the combined operation of section 42 of the BSA and paragraphs 7(1)(f) and 8(1)(f) of Schedule 2 to the BSA, and section 102 of the Radiocommunications Act.  Section 42 of the BSA provides that each commercial television broadcasting licence and each commercial radio broadcasting licence is subject to the conditions set out in Parts 3 and 4 respectively of Schedule 2 of the BSA.  Paragraph 7(1)(f) in Part 3 of Schedule 2 provides that a commercial television broadcasting licensee is required to keep in a force a licence under the Radiocommunications Act which allows the licensee to provide that broadcasting service.  Similarly, under paragraph 8(1)(f) in Part 4 of Schedule 2 of the BSA a commercial radio broadcasting licensee is required to keep in force a licence under the Radiocommunications Act which allows the licensee to provide that broadcasting service.

 

Commercial broadcasters pay a substantial annual fee for a broadcasting service licence based on the revenue generated by their activities (see section 5 of the Television Licence Fees Act 1964 and section 5 of the Radio Licence Fees Act 1964 ). 

 

Tax is imposed for transmitter licences issued under the Radiocommunications Act under the Radiocommunications (Transmitter Licence Tax) Act 1983 (the Act).  Subsection 6(1) of the Act provides that tax is imposed on the issue of a transmitter licence that is issued for a period not exceeding 12 months.  Where a transmitter licence is issued for a period exceeding 12 months, subsection 6(4) of the Act provides that the person applying for the transmitter licence may choose to pay the licence tax by instalments (by making an election to do so under subsection 6(3) of the Act) or on the issue of the licence (by making an election to do so under subsection 6(2) of the Act).

 

This ability to pay licence tax by instalments was introduced by way of amendments to section 6 of the Act in 1996 (by item 2 of Schedule 1 to the Radiocommunications (Transmitter Licence Tax) Amendment Act 1995 ).  Prior to this, tax was imposed on the grant of a transmitter licence.  These amendments have given rise to an anomaly in the imposition of transmitter licence taxes on licences which do not involve a person applying for the licence.  The wording of subsections 6(2), 6(3), 6(4) and 6(5) of the Act gives rise to difficulties in applying the Act to a transmitter licence issued to commercial and community broadcasters under section 102 of the Radiocommunications Act.  The difficulties arise because subsections 6(2), 6(3), 6(4) and 6(5) of the Act refer to a person ‘applying for a transmitter licence’.  However, licences issued under section 102 of the Radiocommunications Act are issued automatically, not upon application.

 

The same difficulties also apply to the imposition of taxes on transmitter licences issued to national and commercial broadcasters under sections 100B and 102A of the Radiocommunications Act to enable the broadcasters to transmit their television services in digital mode. 

 

Section 100B requires the ACA to issue a National Broadcasting Service (NBS) transmitter licence that authorises the operation of a specified radiocommunications transmitter for transmitting the NBS concerned in digital mode where, under a digital conversion scheme in force under clause 19 of Schedule 4 to the BSA, the ACA is required to issue an NBS transmitter licence to a national broadcaster (ie. the ABC and the SBS).  Similarly, section 102A requires the ACA to issue a transmitter licence that authorises the operation of a specified radiocommunications transmitter for transmitting the broadcasting service concerned in digital mode where, under a digital conversion scheme in force under clause 6 of Schedule 4 to the BSA the ACA is required to issue a transmitter licence to a person who holds a commercial television broadcasting licence.  Like section 102 transmitter licences, these licences do not involve a person applying for a licence.  The ACA is required to issue these licences in certain circumstances.

 

The Bill is therefore a technical measure to correct the anomaly described above and will clarify the power to impose transmitter licence tax on transmitter licences regardless of whether the person has applied for a transmitter licence or not.  The Bill also validates the imposition of the transmitter licence tax on licences which are affected by the anomaly and will enable the continued imposition of the transmitter licence tax under the Act.

The Interactive Gambling Bill 2001 (the Bill) provides for

 

 

[to be completed]

 

[CHECK: The Government does not propose to mandate any particular technological solutions to filtering overseas sourced material.  Rather, the industry will be asked in the first instance to propose appropriate procedures they would follow in preventing access to prohibited sites.  These procedures would take account of technical limitations and cost considerations.  However, if the industry is unable or unwilling to develop such procedures itself, or if the procedures are deficient, the ABA will have the ability to make a mandatory industry standard.  The Minister will also have the ability to direct the ABA to determine an industry standard if an ABA request to a relevant industry body or association to make an industry code is not complied with.  In any event, service providers will only be required to prevent access to material hosted on their service that has been subject to a complaint and when subsequently notified by the ABA.  The primary responsibility for material hosted in Australia will rest with the content providers.]

 

 

FINANCIAL IMPACT STATEMENT

 

The Bill is not expected to have any financial impact on Commonwealth expenditure or revenue.

 



ABBREVIATIONS

 

 

The following abbreviations are used in this explanatory memorandum:

 

AAT:                                       Administrative Appeals Tribunal [check]

 

ACA:                                      Australian Communications Authority

 

Act:                                         Radiocommunications (Transmitter Licence Tax) Act 1983

 

Bill:                                         Radiocommunications (Transmitter Licence Tax) Amendment Bill 2002

 

BSA:                                       Broadcasting Services Act 1992

 

Radiocommunications Act:    Radiocommunications Act 1992

 

 

 

 



NOTES ON CLAUSES

 

Part 1--Introduction

 

Clause 1 - Short title

 

Clause 1 provides that the Bill, when enacted, may be cited as the Radiocommunications (Transmitter Licence Tax) Amendment Act 2002 .

 

Clause 2 - Commencement

 

Clause 2 provides that each provision of the Bill (specified in column 1 of the table in clause 2) will commence on the day or at the time specified in column 2 of the table in clause 2 .   The table in clause 2 provides that item 1 of Schedule 1 to the Bill will be taken to commence on 29 March 1996 and that item 2 of Schedule 1 commences on the day on which the Bill receives the Royal Assent.  Clauses 1 to 3 of the Bill, and anything not in items 1 and 2 of Schedule 1 to the Bill, commence on day on which the Bill receives the Royal Assent.  

 

Clause 3 - Schedule(s)

 

Clause 3 provides that the Bill amends each Act as specified in a Schedule to the Bill.  There is one Schedule to the Bill.  This Schedule (Schedule 1) provides for amendments to the Radiocommunications (Transmitter Licence Tax) Act 1983 .

 

Schedule 1 - Radiocommunications (Transmitter Licence Tax) Act 1983

 

Item 1 A - At the end of section 6

 

Proposed item 1 provides for the addition of a number of subsections to section 6 of the Act.  The effect of these additional subsections will be that a person issued with a transmitter licence for more than 12 months under section 100B, 102 or 102A of the Radiocommunications Act will be required to elect, prior to being issued with the transmitter licence, whether the transmitter licence tax in respect of the period of the licence will be paid upon issue of the licence or by instalments.

 

Proposed subsection 6(9) requires that before a person is issued with a transmitter licence for a period exceeding twelve months under section 100B, 102 or 102A of the Radiocommunications Act, the person must elect in writing (in a form approved by the ACA) whether proposed subsection (7) or proposed subsection (8) is to apply in respect of the transmitter licence.  If a person elects that proposed subsection (7) will apply, tax will be imposed upon the issue of the licence for the period the licence is in force.  If a person elects that proposed subsection (8) will apply to the licence, tax will be imposed on the issue of the licence and on each anniversary of the day the licence came into force occurring during the period the licence is in force.  Proposed subsection (8) operates subject to proposed subsections (11) and (12) (which are detailed below). 

 

Proposed subsection (10) provides that if the person does not make an election under proposed subsection (9) before the transmitter licence is issued, the person will be taken to have elected, before the licence is issued, that proposed subsection (8) applies in respect of the licence.  This would result in the transmitter licence tax being payable by instalments. 

 

Proposed subsection (11) provides that if:

 

a)       the holder of a transmitter licence elects, before the licence is issued, that proposed subsection (8) will apply; and

 

b)       subsequently notifies the ACA that proposed subsection (11) is to apply (provided that the notice to the ACA is at least 21 days before the next anniversary of the day that the licence came into force that is more than 12 months before the end of the period that the licence is in force),

 

proposed subsection (8) will cease to apply and tax will be imposed on the holding of the licence on the anniversary. 

 

Proposed subsection (11) would also apply where the holder of a transmitter licence is deemed to have elected (under proposed subsection (10)) that proposed subsection (8) apply.  This effectively provides a mechanism whereby the holder of a licence may choose to pay tax with respect to the remainder of the period of the licence upfront at any time during the period of the licence, provided the holder of the licence chooses to do so at least 21 days before the anniversary of the issue of the licence and there is more than 12 months before the period of the licence expires.

 

Proposed subsection (12) provides that if a licensee has elected that proposed subsection (8) will apply, before a licence is issued, and the licensee fails to pay an instalment within 60 days after the anniversary of the issue of the licence, proposed subsection (8) will cease to apply. Proposed subsection (12) would also apply where the holder of a transmitter licence is deemed to have elected (under proposed subsection (10)) that proposed subsection (8) apply.  This effectively means that, if an instalment is not paid within 60 days after the anniversary of the issue of the licence, the right to pay by instalments will be lost and the full tax for the period of the licence will become payable.

 

Item 2 - Transitional - deeming provisions for the transition from tax purportedly imposed on issued licences to tax actually imposed

 

The transitional provisions apply to an “issued licence”.  An “issued licence” is a transmitter licence issued for a period of more than 12 months under section 100B, 102 or 102A of the Radiocommunications Act 1992 before proposed item 2 commenced (proposed subitem (1)).

 

The transitional provisions ensure that the transmitter licence tax is payable in respect of transmitter licences issued before the commencement of proposed item 2 but which did not involve a person applying for a licence.  The purpose of the transitional provisions is to correct the anomaly that has existed since 29 March 1996 (discussed in the outline) by providing that elections that were purportedly made by persons who were issued with a licence (but who did not apply for the licence) are legally valid elections.

 

Proposed paragraph (a) of subitem 2(2) provides that where a person (before the commencement of proposed item 2) purportedly elected that subsection 6(2) of the Act apply to an issued licence, the person will be taken to have elected at that time that proposed subsection 6(7) apply to the licence.  This ensures that the election made by the person that the tax on the licence be paid in a lump sum is legally valid.

 

Similarly, proposed paragraph (b) of subitem 2(2) provides that where a person (before the commencement of proposed item 2) purportedly elected that subsection 6(3) of the Act apply to an issued licence, the person will be taken to have elected at that time that proposed subsection 6(8) apply to the licence.  This ensures that the election made by the person that the tax on the licence be paid by instalments is legally valid.

 

Proposed subitem 2(3) provides that a person who (before proposed item 2 commenced) paid an amount that purported to be an amount imposed by subsection 6(2), (3), (5) or (6) of the Act in respect of an issued licence is taken to have paid the equivalent tax imposed on the licence by proposed subsection 6(7), (8), (11) or (12).

 

Proposed subitem 2(4) provides that where a person (before the commencement of proposed item 2) purportedly notified the ACA that subsection 6(5) of the Act apply to an issued licence, the person will be taken to have notified the ACA at that time that proposed subsection 6(11) apply to the licence.

 

Proposed subitem 2(5) relates to determinations made under section 7 of the Act.  Section 7 of the Act provides that the amount of tax payable in respect; of the issue of a transmitter licence, the anniversary of a transmitter licence coming into force or on the holding of a transmitter licence, is of an amount that the ACA determines.  Such a determination is a disallowable instrument (see subsection 7(4) of the Act).  Proposed subitem 2(5) provides that any reference to subsection 6(2) of the Act in such a determination will be taken to include a reference to proposed subsection 6(7).  Similarly, proposed subitem 2(5) provides that any references to subsections 6(3), 6(5) and 6(6) of the Act in such a determination will be taken to include a reference to proposed subsections 6(8), 6(11) and 6(12) respectively.  Proposed subitem 2(5) is necessary to ensure that the current anomaly (discussed in the outline) is corrected by including references to proposed subsections 6(8), 6(11) and 6(12) in determinations by the ACA of the amount of tax applying to a transmitter licence that were made prior to the correction of the anomaly.