Commonwealth Consolidated Acts

A NEW TAX SYSTEM (GOODS AND SERVICES TAX) ACT 1999 - SECT 38.450

  (1)   A supply by the Commonwealth, a State or a Territory of land on which there are no improvements is GST - free if:

  (a)   the supply is by way of lease (other than * long - term lease); and

  (b)   the lease is subject to conditions the satisfaction of which will entitle the * recipient of the supply to the grant of a freehold interest in the land or a long - term lease of the land.

  (2)   A supply consisting of the surrender, to the Commonwealth, a State or Territory, of a lease over land is GST - free if:

  (a)   the supplier acquired the land under a supply that:

  (i)   was GST - free under subsection   (1); or

  (ii)   if the supply was made before 1   July 2000--would have been GST - free under subsection   (1) if it had been made on or after that day; and

  (b)   solely or partly in return for the surrender of the lease, the Commonwealth, State or Territory makes a supply of the land to the supplier that is GST - free under section   38 - 445.