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Radiocommunications (Receiver Licence Tax) Amendment Bill 2020

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2019-2020

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

HOUSE OF REPRESENTATIVES

 

 

RADIOCOMMUNICATIONS (Receiver licence tax) AMENDMENT BILL 2020

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

 

 

 

 

 

(Circulated by authority of the Minister for Communications, Cyber Safety and the Arts

the Honourable Paul Fletcher MP)

 



 

 



RADIOCOMMUNICATIONS (RECEIVER LICENCE TAX) AMENDMENT

BILL 2020

 

 

OUTLINE

Amendments proposed in the associated Bill, the Radiocommunications Legislation Amendment (Reform and Modernisation) Bill 2020, aim to increase investment certainty through providing longer maximum licence terms for licences issued under the Radiocommunications Act 1992 (the Radiocommunications Act), introducing a maximum licence term of 20 years for apparatus licences and spectrum licences. Currently, a spectrum licence issued under the Radiocommunications Act has a maximum term of 15 years and an apparatus licence (transmitter or receiver licence) generally has a maximum term of 5 years.

Currently, the timeframes in which licensees pay for the value of the spectrum that they are licensed to use varies between spectrum licences and apparatus licences. Spectrum licences are subject to a spectrum access charge under the Radiocommunications Act. This spectrum access charge must be paid at a time determined by the Australian Communications and Media Authority (ACMA). For receiver licences, payments of tax are made under the provisions of the Radiocommunications (Receiver Licence Tax) Act 1983 (the Act). Where a receiver licence has a term greater than 12 months, the licensee is able to choose whether to pay the applicable tax on the issue of the licence, or in annual instalments over the term of the licence.

With the alignment of the maximum duration of spectrum licences and receiver licences, different timing for the applicable charges and taxes has the potential to introduce inefficiencies in the spectrum management framework by distorting demand between licence types.

This Bill amends the Act to enable ACMA to determine whether, for a specified class of licences with longer than 12 months duration, the tax imposed by the Act is imposed on the issue of the licence for the full period the licence is in force, or whether it should be paid in annual instalments. If a licence does not belong to a specified class determined by ACMA, the current arrangements will continue to apply.

 

 

FINANCIAL IMPACT STATEMENT

 

It is anticipated that the Bill will have no financial impact.

 



 

STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

 

Radiocommunications (Receiver Licence Tax) Amendment Bill 2020

 

This Bill is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 .

 

Overview of the Bill

This Bill amends the Radiocommunications (Receiver Licence Tax) Act 1983 to enable the Australian Communications and Media Authority (ACMA) to determine specified classes of receiver licences where the licence holder will be required to pay the applicable licence tax on the issue of the licence or by annual instalments, rather than the licensee having this election.

This amendment is consequential to the amendments in the Radiocommunications Legislation Amendment (Reform and Modernisation) Bill 2020, which increase the maximum duration of receiver licences from 5 years to 20 years. By introducing the possibility of long-term, high-value receiver licences, the amendments in this Bill are necessary to avoid distorting demand between receiver licences and spectrum licences under the Radiocommunications Act 1992 , which would introduce inefficiencies into the spectrum management framework.

Human rights implications

This Bill does not engage any of the applicable rights or freedoms. The human rights implications of the reforms as a whole are discussed as part of the Statement of Compatibility with Human Rights for the Radiocommunications Legislation Amendment (Reform and Modernisation) Bill 2020.

Conclusion

This Bill is compatible with human rights as it does not raise any human rights issues.

 



 

NOTES ON CLAUSES

Clause 1 - Short Title

This clause advises that the short title of the Act will be the Radiocommunications (Receiver Licence Tax) Amendment Act 2020 .

Clause 2 - Commencement

This clause provides that the Act will commence on a single day to be fixed by proclamation by the Governor-General in Council. However, the Act will commence the day following the expiry of a 6 month period from the day the Act receives the Royal Assent if the Act has not commenced before that day.

Clause 3 - Schedules

This clause provides that the Schedules amend or repeal provisions of the legislation referred to in the Schedule, as set out in the items of that Schedule.

SCHEDULE 1 - AMENDMENTS

PART 1 - AMENDMENTS

Radiocommunications (Receiver Licence Tax) Act 1983

Item 1 - After subsection 6(1)

This item inserts new subsections 6(1A), 6(1B), 6(1C), and 6(1D) into the Act. These provisions enable the Australian Communications and Media Authority (ACMA) to determine whether the licensee of a receiver licence of more than 12 months duration, where an application is made, pays the applicable tax on the issue of the licence or in annual instalments.

Subsection 6(1A) provides that for a receiver licence with a licence period greater than 12 months that is covered by a determination made by ACMA under subsection 6(1B), tax will be imposed on the licensee on the issue of the licence for the full licence period.

Subsection 6(1B) provides ACMA with the power to determine classes of receiver licence for the purposes of subsection 6(1A). These determinations will enable ACMA to specify matters such as particular uses of the spectrum and particular durations of licences where the licensee will be required to pay tax upfront. These determinations will be made by legislative instrument, and thus subject to requirements such as the consultation, disallowance and sunsetting provisions of the Legislation Act 2003 .

Subsection 6(1C) provides that for a receiver licence with a licence period greater than 12 months that is covered by a determination made by ACMA under subsection 6(1D), tax will be imposed in instalments, occurring on the issue of the licence and on each anniversary of the licence coming into force.

Subsection 6(1D) provides ACMA with the power to determine classes of receiver licence for the purposes of subsection 6(1C). These determinations will enable ACMA to specify matters such as particular uses of the spectrum and particular durations of licences where the licensee will be required to pay tax by instalment. These determinations will also be made by legislative instrument.

In each instance, the amount of tax payable will be calculable using the determinations made by ACMA under section 7 of the Radiocommunications (Receiver Licence Tax) Act 1983 (the Act).

Item 2 - Subsection 6(4)

Subsection 6(4) currently provides that a licensee must choose to either pay upfront or to pay by annual instalments. This item repeals and substitutes this subsection, so that it provides that this election must be made only in circumstances where the licence is not covered by a determination under subsection 6(1B) or 6(1D), as these determinations would determine whether payments are to be made upfront or by annual instalment.

PART 2 - APPLICATION PROVISION

Item 3 - Application - section 6 of the Radiocommunications (Receiver Licence Tax) Act 1983

This item provides that the amendments made by items 1 and 2 above only apply to receiver licences where the application for the receiver licence is made after the commencement of this item. This means that ACMA will be unable to alter the payment arrangements for existing receiver licences and that determinations made under subsection 6(1B) and 6(1D) will only apply to licences issued after the commencement of this item (including the renewal of a licence).