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Sales Tax (In Situ Pools) (Deficit Reduction) Bill 1993

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House: House of Representatives

Portfolio: Treasury


To increase the rates of sales tax as they relate to the tax on in situ pools imposed by the Sales Tax Imposition (In Situ Pools) Act 1992.


This Bill forms part of a package of eight Bills that replace the Taxation (Deficit Reduction) Bill 1993. The initiative follows debate on the constitutional validity of the original Bill, which contained amendments to a range of taxes. The change to the package of eight Bills was announced by the Treasurer on 21 September 1993 and followed the report of the Senate Standing Committee on Legal and Constitutional Affairs which found that there was a real risk that the High Court would find that the Bill, once it became an Act, would breach section 55 of the Constitution. 1

The package of Bills contains five sales tax Bills which reflect the nature of sales tax. Depending on the circumstance in which sales tax is imposed, the tax may be defined to be a customs duty, an excise duty or a tax.

To satisfy section 55 of the Constitution, there are three separate Bills imposing the change in sales tax. These are:

* Sales Tax (Customs) (Deficit Reduction) Bill 1993;

* Sales Tax (Excise) (Deficit Reduction) Bill 1993; and

* Sales Tax (General) (Deficit Reduction) Bill 1993.

In addition, the Sales Tax (In Situ Pools) (Deficit Reduction) Bill 1993 is necessary to amend the separate Act that imposes sales tax in respect of in situ pools. Again, this is necessary to prevent a possible challenge under section 55 of the Constitution.

Also refer to the Digests for the related Bills listed on the cover to this Digest.

Main Provisions

Rates of Sales Tax

Wholesale sales tax contributed $9440 million to consolidated revenue in 1992- 3 and is estimated to increase by 10.6% this year to $10 230 million. Currently, goods may fall into one of five categories for sales tax purposes, the may be exempt or taxed at 10%, 15%, 20% or 30%. The majority of goods are taxed at the general rate of 20%. (This Bill will introduce a new rate of 45% for part of the price of luxury cars - see above.) In the 1993- 94 Budget speech the Treasurer announced that the 10%, 15%, 20% and 30% rates would increase by 1% from 18 August 1993 and by a further 1% on 1 July 1995. The measures are estimated to raise an additional $435 million in 1993- 4, increasing to $1345 million in 1996- 7.

The increases in sales tax will be achieved by clauses 5 and 6 which will give effect to Schedules 1 and 2 of the Bill.

Sales Tax (In Situ Pools) (Deficit Reduction) Bill 1993


1. Senate Standing Committee on Legal and Constitutional Affairs, Constitutional Aspects of the Taxation (Deficit Reduction) Bill 1993, September 1993, p. 1.

C. Field (06 2772439)

Bills Digest Service 28 September 1993

Parliamentary Research Service

This Digest does not have any official legal status. Other sources should be consulted to determine the subsequent official status of the Bill.

Commonwealth of Australia 1993.

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Published by the Department of the Parliamentary Library, 1993.