Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
 Download Current HansardDownload Current Hansard   

Previous Fragment    Next Fragment
Monday, 2 December 1985
Page: 2675


Senator GARETH EVANS (Minister for Resources and Energy)(4.01) —I move:

That the Bills be now read a second time.

I seek leave to have the second reading speeches incorporated in Hansard.

Leave granted.

The speeches read as follows-

SALES TAX (EXEMPTIONS AND CLASSIFICATIONS) AMENDMENT BILL (No. 2) 1985

This is the first of four Bills to amend the sales tax law.

The Bills give effect to a decision announced on 5 September 1984 approving in principle the provision of inwards duty free shopping facilities at Australia's international airports.

My colleague, the Minister for Science, in his capacity as Minister Assisting the Minister for Industry, Technology and Commerce, introduced complementary customs and excise amendments in another place on 13 November 1985.

This Bill is one element in the legislative framework to provide exemptions from sales tax on a restricted range of goods purchased from on-airport inwards duty free shops by persons arriving in Australia on international flights.

Inwards duty free shops will be warehouses licensed under the Customs Act and authorised to sell spirituous liquors, tobacco products and perfume to passengers and crew arriving on international flights after disembarkation, but before reaching the customs barrier.

The establishment of inwards duty free shopping facilities at international airports will provide a convenient alternative to overseas or in-flight purchases of tax and duty free spirituous liquor, tobacco products and perfume.

The provision of these facilities at airports is expected to increase airport concession revenues by about $5 million in a full year.

Of the goods to be sold by inwards duty free shops, tobacco, cigarettes and cigars are presently unconditionally exempt from sales tax, but spirituous liquor is taxed at the rate of 20%, and perfume at the rate of 32.5% (to be reduced to 30% from 20 September 1985 under Bills currently before the Parliament).

However, passengers and crew arriving on international flights are eligible for a sales tax exemption on certain goods imported by them, including one litre of potable alcoholic liquor and perfume to the extent to which it is not in commercial quantities.

Mr President, I should emphasise that the amendments contained in this Bill will not increase the level of sales tax concessions available to persons arriving from overseas.

The limits I have described will continue but will apply to the aggregate of specified goods, whether purchased by the passenger overseas, in-flight or from an inwards duty free shop on arrival.

There is, therefore, no cost of this measure in terms of revenue forgone.

To enable inwards duty free shops to acquire their supplies free of sales tax, a further provision in the Bill will exempt from tax purchases of spirituous liquor and perfume for re-sale through such shops to passengers and crew arriving in Australia on international flights.

I commend the Bill to the Senate.

SALES TAX ASSESSMENT BILL (No. 11) 1985

This Bill, together with its two related taxing Bills, completes the sales tax package for the establishment of inwards duty free shopping facilities at international airports.

As I explained a moment ago, inwards duty free shops will be accessible to passengers or crew arriving on international flights before reaching the customs barrier.

These people will be able to purchase spirituous liquor, tobacco products and perfume.

In the hands of passengers and crew such goods will be exempt from sales tax if, together with similar goods imported by them, the total quantity falls within the prescribed limits I mentioned earlier.

Mr President, the purpose of this Bill is twofold.

First, to apply the sales tax law to Australian manufactured goods purchased from inwards duty free shops by disembarking passengers and crew where those goods together with goods imported are in excess of the prescribed limits.

The Bill is limited to Australian manufactured goods for the reason that the existing sales tax law will apply to imported goods purchased from an inwards duty free shop and entered for home consumption by international travellers.

Secondly, this Bill will extend the sales tax law to Australian manufactured goods dealt with, otherwise then by way of sales to disembarking passengers and crew, by the proprietor of an inwards duty free shop who is not registered for sales tax purposes.

In situations where goods are sold to other persons or applied by the shop proprietor to his or her own use, the Bill will provide that sales tax is immediately payable by the proprietor on the goods.

If such dealings occur where the proprietor is registered or required to be registered for sales tax purposes, the existing sales tax law, in conjunction with amendments of the Sales Tax (Exemptions and Classifications) Act just introduced, will ensure that an appropriate amount of sales tax becomes payable.

Finally, Mr President, I mention that, if sales tax payable under this measure is not paid on demand, the particular goods may, as can now occur under the customs law where customs duty is not paid, be seized by customs' officers, unless security for payment of the tax is given.

In the event that the sales tax remains unpaid, the goods will be forfeited to the Crown.

I commend the Bill to the Senate.

SALES TAX BILL (No. 11A) 1985

This is the first of the two taxing Bills that I mentioned in introducing the Sales Tax Assessment Bill (No. 11) 1985.

It is a requirement of the Constitution that a law imposing taxation shall deal only with one subject of taxation and that laws imposing customs duties and laws imposing excise duties deal only with those duties.

This Bill will, respecting that requirement of the Constitution, formally impose sales tax payable under the proposed Sales Tax Assessment Act (No. 11) on goods dealt with in a taxable manner, in cases where that sales tax is technically a duty or excise.

This Bill will impose sales tax at the same rate as those to be imposed by a series of sales tax Bills currently before the Parliament.

An exception to this is that the Bill does not impose tax on motor vehicles covered by the Fourth or Fifth Schedule to the Sales Tax (Exemptions and Classifications) Act as goods of that kind cannot be sold through inwards duty free shops.

I commend the Bill to the Senate.

SALES TAX BILL (No. 11B) 1985

This is the second taxing Bill associated with the introduction of inwards duty free shopping facilities at international airports.

By this Bill sales tax will be formally imposed on goods dealt with in a taxable manner where the tax is neither a duty of excise nor a duty of customs.

In other respects, this Bill is identical in effect with the Sales Tax Bill (No. 11A) 1985.

It is not necessary to impose sales tax where the tax is technically a duty of customs as the existing sales tax law does so in relation to dealings with imported goods.

An explanatory memorandum providing a detailed explanation of the provisions of each of the four Bills I have just introduced is being circulated to honourable senators.

I commend this Bill to the Senate.

Debate (on motion by Senator Sheil) adjourned.