Victorian Bills Explanatory Memoranda Victorian Bills Explanatory Memoranda[Index] [Search] [Download] [Bill] [Help]
State Taxation Acts Amendment
Bill 2017
Introduction Print
EXPLANATORY MEMORANDUM
General
The Bill amends the Duties Act 2000--
• in relation to off-the-plan purchases, first home buyer
exemptions and concessions, and principal place of residence
concessions;
• to make further provision for transactions that are treated as
sub-sale arrangements and the imposition of duty on those
transactions;
• in relation to the requirements for the provision of information
for certain transactions and related offences;
• in relation to an exemption for the transfer of a principal place
of residence between domestic partners or spouses;
• in relation to certain landholders and the financial exchanges;
• to provide for an exemption from insurance duty for
agricultural insurance products; and
• to increase the rate of motor vehicle duty for new and near new
passenger vehicles.
The Bill amends the First Home Owner Grant Act 2000 to exempt
members of the Defence Force from the residence requirement and to
increase the first home owner grant to $20 000 for purchases of new homes in
regional Victoria.
The Bill amends the Land Tax Act 2005 to impose vacant residential land
tax.
581337 1 BILL LA INTRODUCTION 1/5/2017
The Bill amends the Payroll Tax Act 2007 to bring forward, by one year, the
annual threshold amounts and monthly base deductible amounts which were
to apply on and after the 2018 financial years; and provide for a lower rate of
payroll tax to be paid by certain Victorian regional employers in respect of
taxable wages those employers pay to their employees who perform their
services mainly in regional Victoria.
The Bill amends the Planning and Environment Act 1987 in relation to the
calculation of the metropolitan planning levy threshold.
The Bill amends the Taxation Administration Act 1997--
• in relation to the definition of a taxation law for the purposes of
that Act;
• in relation to offences relating to false and misleading
statements and omissions;
• to authorise the collection and disclosure of information about
transfers of interests in real property for the purposes of
reporting to the Commissioner of Taxation of the
Commonwealth;
• in relation to the disclosure of information by taxation officers
for verification purposes; and
• to enable vacant residential land tax to be administered in the
same way as other land taxes.
The Bill amends the Unclaimed Money Act 2008 in relation to offences
about the provision of false or misleading information.
The Bill amends the Valuation of Land Act 1960 to provide for general
valuations to be made annually and for the valuer-general to conduct all
valuations under that Act.
The Bill also makes consequential amendments to certain other Acts as a
result of the amendments made to the Valuation of Land Act 1960.
Clause Notes
Part 1--Preliminary
Part 1 of the Bill outlines the purposes of the Bill and contains the
commencement provisions and definitions.
Clause 1 outlines the purposes of the Bill.
Clause 2 provides the commencement dates for the Bill.
2
The Act (except Divisions 1 to 5 and 7 to 9 of Part 2 and Parts 3,
4, 5, 6, 7, 8 and 9) comes into operation on the day on which it
receives Royal Assent.
Division 1 of Part 2, which amends the Duties Act 2000 in
relation to off-the-plan purchases, first home buyer exemptions
and concessions, and principal place of concessions, comes into
operation on the day after the day on which this Act receives the
Royal Assent.
Division 2 of Part 2, which amends the Duties Act 2000 in
relation to the requirements for the provision of information for
certain transactions, comes into operation on the day after the day
on which this Act receives the Royal Assent.
Division 3 of Part 2, which amends the Duties Act 2000 to make
further provision for transactions that are treated as sub-sale
arrangements and the imposition of duty on those transactions,
comes into operation on the day after the day on which this Act
receives the Royal Assent.
Division 4 of Part 2, which amends the Duties Act 2000 in
relation to offences related to the provision of false or misleading
information, comes into operation on the day after the day on
which this Act receives the Royal Assent.
Division 5 of Part 2, which amends the Duties Act 2000 in
relation to an exemption for the transfer of a principal place of
residence between domestic partners or spouses, comes into
operation on 1 July 2017.
Division 6 of Part 2, which amends the Duties Act 2000 in
relation to certain landholders and financial exchanges, comes
into operation on the day on which this Act receives Royal
Assent.
Division 7 of Part 2, which amends the Duties Act 2000 to
provide for an exemption from insurance duty for agricultural
insurance products, comes into operation on 1 July 2017.
Division 8 of Part 2, which amends the Duties Act 2000 to
increase the rate of motor vehicle duty for new and near new
passenger vehicles, comes into operation on 1 July 2017.
3
Division 9 of Part 2, which amends the Duties Act 2000 to
provide transitional arrangements for off-the-plan purchases and
sub-sale transactions, comes into operation on the day after the
day on which this Act receives the Royal Assent.
Part 3, which amends the First Home Owner Grant Act 2000 to
exempt members of the Defence Force from the residence
requirement and increase the first home owner grant to $20 000
for purchases of new homes in regional Victoria, comes into
operation on the day after the day on which this Act receives the
Royal Assent.
Part 4, which amends the Land Tax Act 2005 to impose a vacant
residential land tax, comes into operation on 1 January 2018.
Part 5, which amends the Payroll Tax Act 2007 to bring
forward, by one year, the annual threshold amounts and monthly
base deductible amounts which were to apply on and after the
2018 financial years; and provide for a lower rate of payroll tax
to be paid by certain Victorian regional employers in respect of
taxable wages those employers pay to their employees who
perform their services mainly in regional Victoria, comes into
operation on the day after the day on which this Act receives the
Royal Assent.
Part 6, which amends the Planning and Environment Act 1987
in relation to the calculation of the metropolitan planning levy
threshold, comes into operation on the day after the day on which
this Act receives the Royal Assent.
Divisions 1 to 4 of Part 7, which amend the Taxation
Administration Act 1997 in relation to the definition of a
taxation law for the purposes of that Act; in relation to offences
relating to false and misleading statements and omissions; to
authorise the collection and disclosure of information about
transfers of interests in real property for the purposes of reporting
to the Commissioner of Taxation of the Commonwealth; and in
relation to the disclosure of information by taxation officers for
verification purposes, comes into operation on the day after the
day on which this Act receives the Royal Assent.
4
Division 5 of Part 7, which amends the Taxation
Administration Act 1997 to enable the vacant residential land
tax to be administered in the same way as other land taxes, comes
into operation on 1 January 2018.
Part 8, which amends the Unclaimed Money Act 2008 in
relation to offences for the provision of false or misleading
information, comes into operation on the day after the day on
which this Act receives the Royal Assent.
Part 9, which amends the Valuation of Land Act 1960 to
provide for general valuations to be made annually and for the
valuer-general to conduct all valuations under that Act, comes
into operation on 1 July 2018.
Part 2--Amendment of the Duties Act 2000
Part 2 of the Bill amends the Duties Act 2000 in relation to off-the-plan
purchases, first home buyer exemptions and concessions, and principal place
of residence concessions; to make further provision for transactions that are
treated as sub-sale arrangements and the imposition of duty on those
transactions; in relation to the requirements for the provision of information
for certain transactions and related offences; in relation to an exemption for
the transfer of a principal place of residence between domestic partners or
spouses; in relation to certain landholders and the financial exchanges; to
provide for an exemption from insurance duty for agricultural insurance
products; and to increase the rate of motor vehicle duty for new and near new
passenger vehicles.
Division 1--Off-the-plan purchases and principal place of
residence
Clause 3 inserts a new definition in section 3(1) of the Duties Act 2000 for
PPR transfer. This has been inserted as the off-the-plan
concession and refurbishment concession now refer to a PPR
transfer. The requirements for a PPR transfer are still set out in
section 57I.
Clause 4 amends section 21 of the Duties Act 2000.
Subclause (1) inserts a new section 21(2) into the Act. The new
section provides that the off-the-plan concession in section 21(3)
and refurbishment concession in section 21(4) are now only
relevant for the purpose of determining if a transfer meets the
dutiable value thresholds for a calculation of duty under
5
section 57J or first home buyer exemption or concession under
section 57JA. The concessions will no longer be available for
other purchases, such as purchases of investment properties.
Subclause (2) makes minor changes to sections 21(3) and (4) so
as to be consistent with new section 21(2).
Clause 5 amends the note at the foot of section 32B(6) of the Duties Act
2000 to reflect that the off-the-plan concession and refurbishment
concession are now only relevant for certain transfers.
Clause 6 amends section 32V of the Duties Act 2000.
Subclause (1) inserts new sections 32V(2A) and (2B) into the
sub-sale provisions in Part 4A of Chapter 2. These provisions
replicate what is provided for in section 21(2) but for a sub-sale
context. The provisions provide that the off-the-plan concession
in section 32V(3) and refurbishment concession in section 32(4)
are now only relevant for the purpose of determining if a
transaction under the sub-sale provisions meets the dutiable value
thresholds for a calculation of duty under section 57J or first
home buyer exemption or concession under section 57JA. The
concessions will no longer be available for other purchases, such
as purchases of investment properties.
Subclauses (2) and (3) make minor changes to sections 32V(3)
and (4) so as to be consistent with new section 32V(2A).
Clause 7 amends the heading to Division 4A of Part 5 of Chapter 2 of the
Duties Act 2000 as part of the changes that recast the off-the-
plan concession and refurbishment concession.
Clause 8 inserts a new definition in section 57G(1) of the Duties Act 2000
for PPR concessional rate. The definition is used in Division 4A
of Part 5 of Chapter 2 to ensure only transfers that have obtained
a benefit will trigger a residence requirement. Accordingly, if
there has been no adjustment to the consideration for the transfer
under sections 21(3) or (4) or sections 32V(3) or (4), and no
exemption or concession from duty applied under section 57JA
then there will be no residence requirement if the dutiable value
of the property the subject of the transfer is less than $130 001.
Clause 9 amends section 57I of the Duties Act 2000 by removing the
dutiable value threshold for a PPR transfer. The relevant
thresholds for a PPR transfer to obtain a duty calculation under
6
section 57J or duty exemption or concession under section 57JA
are set out in those sections.
Clause 10 amends section 57J of the Duties Act 2000.
Subclause (1) makes a minor amendment to the heading to
section 57J as part of the changes that recast the off-the-plan
concession and refurbishment concession.
Subclause (3) inserts rates of duty into the table in section 57J for
PPR transfers where the dutiable value of the dutiable property is
below $130 001. These rates are identical to the rates in section
28(1). They have been inserted into section 57J to ensure the off-
the-plan concession and refurbishment concession can apply
where as a result of applying either concession a dutiable value
below $130 001 is obtained. In such circumstances the transfer
will be subject to a residence requirement, on the basis there has
been an adjustment to the consideration for the transfer. Where
no adjustment to the consideration for the transfer is made but the
subject property has a dutiable value of below $130 001 the
transfer will not be subject to a residence requirement unless
there has been a concession or exemption from duty applied
under section 57JA.
Subclauses (2) and (4) make consequential amendments to
section 57J and the note in section 57J as a result of the insertion
of the new rates referred to above.
Clause 11 substitutes section 57JA of the Duties Act 2000 with a new
section 57JA and inserts new section 57JB.
The new section 57JA provides that a first home buyer who
purchases a property with a dutiable value below $600 000 will
be exempt from duty provided certain requirements are met. The
section also provides a concession for duty for a first home buyer
who purchases a property with a dutiable value between
$600 001 and $750 000. The section sets out a formula for the
concession calculation. The formula provides a greater
concession the closer the dutiable value of the property is to
$600 000 with the impact of the concession progressively
reducing as the dutiable value of the property approaches
$750 000. When determining the dutiable value of the subject
property for purpose of this section, the off-the-plan concession
and refurbishment concession in sections 21(3) and (4) and
sections 32V(3) and (4) can be applied.
7
New section 57JB sets out additional requirements that must be
met for an exemption or concession under section 57JA to be
applied. The requirements are that a first home owner grant
under the First Home Owner Grant Act 2000 is paid or payable
in respect of the transfer or would be paid or payable but for the
fact the home is not a new home or the threshold in section
13(1A) of the First Home Owner Grant Act 2000 is not met.
The requirements are the same as those that existed under the
previous first home buyer duty reduction with the exception that
the threshold in the First Home Owner Grant Act 2000 is no
longer applicable.
Clause 12 substitutes section 57K(1) of the Duties Act 2000 with a new
subsection. The former section 57K(1) contained a residence
requirement for a PPR transfer that obtained a concession under
section 57J or a duty reduction under section 57JA. The new
section 57K(1) makes a PPR transfer that obtains the benefit of
the off-the-plan concession or refurbishment concession in
sections 21(3) or (4) or sections 32V(3) or (4) also subject to the
residence requirement. This is as a result of the recasting of the
off-the-plan concession and refurbishment concession to only
apply to a PPR transfer that obtains a calculation of duty under
section 57J or a duty exemption or concession under section
57JA.
The concept of a PPR concessional rate is also used in the new
section 57K(1). A PPR concessional rate means a rate of duty
under section 57J where the dutiable value of the dutiable
property is more than $130 000. The concept is used in the new
section 57K(1) to ensure that only PPR transfers that have
obtained a benefit will be subject to a residence requirement.
Section 57J now includes rates of duty for transactions where the
dutiable property has a dutiable value below $130 001. These
rates are identical to the rates in section 28(1). They have been
inserted into section 57J to ensure the off-the-plan concession
and refurbishment concession can apply where as a result of
either concession a dutiable value below $130 001 is obtained.
In such circumstances the transfer will be subject to a residence
requirement, on the basis there has been an adjustment to the
consideration for the transfer--section 57K(1)(c). Where no
adjustment to the consideration for the transfer is made but the
subject property has a dutiable value of below $130 001 the
transfer will not be subject to residence requirement unless there
8
has been a concession or exemption from duty applied under
section 57JA.
Clause 13 substitutes section 57L(2) of the Duties Act 2000 with a new
subsection and subsection (2A). The provision applies where a
temporary absence has been approved but the residence
requirement has yet to be fully met. The new section ensures that
a transferee who has obtained the benefit of an off-the-plan
concession or refurbishment concession must repay that benefit,
as well as any benefit obtained under section 57J or 57JA, before
being entitled to any of these concessions for a new transfer.
Clause 14 substitutes sections 57M(1)(a) and 57M(4) of the Duties Act
2000.
These changes are a consequence of the off-the-plan concession
or refurbishment concession now being subject to the residence
requirement in section 57K.
Section 57M(1)(a) has been changed to provide that a transferee
who has obtained the benefit obtained of an off-the-plan
concession or refurbishment concession must repay that benefit if
the residence requirement in section 57K is not met. This is in
addition to any benefit obtained under section 57J or section
57JA.
Section 57M(4) has been changed to ensure that a transferee who
has obtained the benefit of an off-the-plan concession or
refurbishment concession but has not met the residence
requirement must repay that benefit, as well as any benefit
obtained under section 57J or 57JA, before being entitled to any
of these concessions for a new transfer.
Clause 15 substitutes section 57N(1) of the Duties Act 2000 with a new
subsection.
As a consequence of the off-the-plan concession or refurbishment
concession now being subject to the residence requirement in
section 57K, section 57N(1) has been changed to also require a
person who has obtained the off-the-plan concession or
refurbishment concession to notify the Commissioner if they
become aware of any circumstances that may result in the
residence requirement not being complied with.
9
The concept of a PPR concessional rate is also used in the new
section 57N(1). A PPR concessional rate means a rate of duty
under section 57J where the dutiable value of the dutiable
property is more than $130 000. The concept is used in the new
section 57N(1) as only PPR transfers that have obtained a benefit
are subject to a residence requirement and therefore the
notification requirement.
Clause 16 amends the heading to Division 5 of Part 5 of Chapter 2 of the
Duties Act 2000. The amendment is minor to ensure wording is
consistent across Division 5.
Clause 17 amends sections 60A(1)(b)(i), (2)(b)(i) and (3)(a) of the Duties
Act 2000 to reflect that section 57JA now applies as an
exemption or concession.
Division 2--Provision of information
Clause 18 amends section 21(4A) of the Duties Act 2000 which requires
certain documents, including a statutory declaration, to be lodged
with the Commissioner for the purposes of claiming an off-the-
plan or refurbishment concession.
Subclause (1) substitutes "information in the approved form
given" for "statutory declaration in the approved form" in section
21(4A)(c), (d) and (e). These amendments replace the current
statutory requirement for a transferor, transferee, or person who
issued the building permit to make a statutory declaration, with a
requirement to provide information in the approved form.
Subclause (2) inserts a note at the foot of section 21(4A) to
clarify that information may be given by means of electronic
communication in accordance with the Electronic Transactions
(Victoria) Act 2000.
Clause 19 substitutes "gives information" for "makes a statutory
declaration" in section 21B of the Duties Act 2000.
Clause 20 substitutes "gives information" for "makes a statutory
declaration" in section 21E(a) of the Duties Act 2000. This
clause also substitutes "information" for "statutory declaration"
in section 21E(b) of the Duties Act 2000.
These consequential amendments to sections 21B and 21E are
required to reflect the removal of "statutory declaration" in
sections 21(4A)(c), (d) and (e).
10
Clause 21 substitutes "information in the approved form given" for
"statutory declaration in the approved form" in section
32V(4A)(c), (d) and (e) of the Duties Act 2000. These
amendments replace the current statutory requirement for a
transferor, transferee, or person who issued the building permit
to make a statutory declaration, with a requirement to provide
information in the approved form.
Clause 21(2) inserts a note at the foot of section 32V(4A) of the
Duties Act 2000 to clarify that information may be given by
means of electronic communication in accordance with the
Electronic Transactions (Victoria) Act 2000.
Clause 21(3) substitutes "information given" for "a statutory
declaration made".
Clause 22 substitutes "information" for "a statutory declaration" in section
32X(2) and (3) of the Duties Act 2000. These amendments
replace the current statutory requirement for a transferor,
transferee, or person who issued the building permit to make a
statutory declaration, with a requirement to provide information
in the approved form.
Clause 22(2) inserts a note at the foot of section 32X of the
Duties Act 2000 to clarify that information may be given by
means of electronic communication in accordance with the
Electronic Transactions (Victoria) Act 2000.
Division 3--Sub-sale transactions
Clause 23 amends definitions in sections 32A(1) of the Duties Act 2000
which are specific to the sub-sale provisions in Part 4A of
Chapter 2.
Subclauses (1)(a), (1)(c), (1)(d) and (1)(e) amend the definitions
of first purchaser, subsequent purchaser, subsequent
transaction and transfer right as a consequence of new Division
3A being inserted into Part 4A.
Subclause (1)(b) inserts a new definition of specified Chapter 2
exemption. This definition is linked to related amendments that
will now restrict the Chapter 2 exemptions available to
transactions under the sub-sale provisions. The definition
provides that a specified Chapter 2 exemption is an exemption
under Chapter 2 other than an exemption under Division 1 or 2 of
Part 5 or an exemption under section 43.
11
Subclause (1)(f) amends the definition of transfer right with
respect to Division 4 by referring to section 32P(4). Section
32P(4) has been inserted to explain what is a transfer right in an
option arrangement context. A similar section is set out in new
Division 3A, being section 32O(4).
Subclause (2) repeals section 32A(2) as new provisions have
been inserted into each division dealing with partial transfer
rights, making the definition redundant.
Clause 24 inserts new sections 32C(5) and (6) into the Duties Act 2000.
Section 32C sets out how duty is charged under Division 2 of
Part 4A of Chapter 2 for transfers involving additional
consideration. New section 32C(5) provides for how duty is
charged where a partial transfer right is acquired. This section
introduces the concept of initial transaction and latter
transaction. Section 32C(6) provides that an initial transaction
can be the sale contract or, where there are serial subsequent
transactions, each subsequent transaction. Section 32C(6) also
provides that the latter transaction means a subsequent
transaction immediately following an initial transaction. Section
32C(5) provides that where a partial transfer right is acquired
under a latter transaction an adjustment is to be made to the duty
to be charged under the initial transaction. Two examples are
provided explaining how the new provisions work. Sections
32C(5) and (6) mirror new sections 32J(8) and (9) in Division 3,
new sections 32OA(4) and (5) in Division 3A and new sections
32Q(8) and (9) in Division 4.
Clause 25 amends section 32D of the Duties Act 2000 by deleting the
words "excluded costs or" in paragraph 32D(2)(a). As a result,
excluded costs are no longer relevant when determining the
dutiable value of a subsequent transaction under Division 2.
The concept of excluded costs will continue to be relevant to
determining if additional consideration has been given or agreed
to be given for the purpose of Division 2.
Clause 25 also repeals section 32D(3). The provision is no
longer relevant as the acquisition of a partial transfer right under
Division 2 will be considered under section 32C(5).
12
Clause 26 amends sections 32G(1) and (3) of the Duties Act 2000 to
substitute the words "this Chapter" with a "specified Chapter 2
exemption". The effect of this amendment is to restrict certain
Chapter 2 exemptions from applying to transactions under
Division 2. The amendment removes the availability of the
Trusts and Superannuation exemptions in Division 1 and 2 of
Part 5 of Chapter 2 and the Marriage and Domestic Relationships
exemption in section 43. These exemptions will continue to be
available after the property has been transferred to the transferee.
Further, the specific sub-sale exemption in section 32W for
transactions between relatives will continue to be available.
Clause 27 amends section 32J of the Duties Act 2000 by repealing section
32J(5)(c) and inserting new subsections (7), (8) and (9).
Subsection 32J(5)(c) currently provides that no duty is charged
under Division 3 on the dutiable value of a subsequent
transaction referred to in subsection 32J(1)(c) if duty is charged
on the subsequent transaction under Division 2 of Part 4A. This
will be provided for under new section 32J(7). Section 32J(7)
also provides that no duty is charged under Division 3 on the
final subsequent transaction referred to in section 32J(1)(b) if
duty was charged on the subsequent transaction under Division 2.
The provision ensures only one lot of duty is payable on a
subsequent transaction under Part 4A. The provision is not
intended to provide an exemption from duty and will only apply
if duty has been charged on the subsequent transaction under
Division 2.
Sections 32J(8) and (9) provide for how duty is charged under
Division 3 where a partial transfer right is acquired. The
provisions mirror new sections 32C(5) and (6) in Division 2, new
sections 32OA(4) and (5) in Division 3A and new sections
32Q(8) and (9) in Division 4.
Section 32J(8) introduces the concept of initial transaction and
latter transaction. Section 32J(9) provides that an initial
transaction can be the sale contract or, where there are serial
subsequent transactions, each subsequent transaction. Section
32J(8) also provides that the latter transaction means a
subsequent transaction immediately following an initial
transaction. Section 32C(5) provides that where a partial transfer
right is acquired under a latter transaction an adjustment is to be
13
made to the duty to be charged under the initial transaction. Two
examples are provided explaining how the new provisions work.
Clause 28 amends section 32K of the Duties Act 2000 by deleting the
words "excluded costs or" in paragraph 32K(2)(a). As a result,
excluded costs are no longer relevant when determining the
dutiable value of a subsequent transaction under Division 3.
Clause 28 also repeals section 32K(3). The provision is no
longer relevant as the acquisition of a partial transfer right under
Division 3 will be considered under section 32J(8).
Clause 29 amends sections 32N(1) and (3) of the Duties Act 2000 to
substitute the words "this Chapter" with a "specified Chapter 2
exemption". The effect of this amendment is to restrict certain
Chapter 2 exemptions from applying to transactions under
Division 3. The amendment removes the availability of the
Trusts and Superannuation exemptions in Division 1 and 2 of
Part 5 of Chapter 2 and the Marriage and Domestic Relationships
exemption in section 43. These exemptions will continue to be
available after the property has been transferred to the transferee.
Further, the specific sub-sale exemption for transaction between
relatives in section 32W will continue to be available
Clause 30 inserts new Division 3A into Part 4A of Chapter 2 of the Duties
Act 2000 covering sections 32O to 32OE.
New Division 3A treats transactions arising from arrangements
where additional consideration has been given to obtain or
assume a transfer right under an option as a sub-sale of land.
Division 3A applies similarly to how Division 4 applies but the
trigger for its application is additional consideration rather than
land development.
The acquisition of a transfer right for additional consideration is
the primary indicator of a sub-sale. Accordingly, Division 3A is
now the primary division that will apply where a transfer right is
obtained or assumed under an option arrangement with Division
4 complementing new Division 3A in the same way as Division 3
complements Division 2.
Section 32O sets out when Division 3A will apply. It requires a
subsequent purchaser or an associate of a subsequent purchaser to
give or agree to give additional consideration in order for the
subsequent purchaser to obtain or assume the transfer right from
a first purchaser, who has that transfer right under an option.
14
Option is defined under section 32A. Transfer right in this
context is also defined in section 32O(4) as a right or obligation
to enter into a contract of sale of a property or any part of a
property or the right or obligation to accept a transfer of the
property or any part of the property. The definitions of additional
consideration and parallel arrangement in Division 2 are
replicated in section 32O(4) of Division 3A.
Section 32OA(1) provides how duty is charged on a transfer to
which Division 3A applies. It provides that duty is not charged
in respect of the transfer from vendor to the transferee, but is
charged separately and distinctly on--
(a) the dutiable value of the option; and
(b) the dutiable value of the subsequent transaction by
which the final subsequent purchaser obtained or
assumed the transfer right; and
(c) if there are any other subsequent transactions, the
dutiable value of each of those transactions.
Section 32O(2) provides that the rate of duty is the rate set out in
Part 3 of Chapter 2.
Section 32O(3) provides that duty is not charged under Division
3A on the dutiable value of a subsequent transaction referred to
in section 32O(1)(b) or (c) (as the case requires) if duty was
charged on the subsequent transaction under Division 2 or 3.
This provision ensures only one lot of duty is payable on a
subsequent transaction under Part 4A. The provision is not
intended to provide an exemption from duty and will only apply
if duty has been charged on the subsequent transaction under
either Division 2 or 3.
Section 32OA(4) and (5) provide for how duty is charged under
Division 3A where a partial transfer right is acquired. The
provisions mirror the new sections 32C(5) and (6) in Division 2,
new sections 32J(7) and (8) in Division 3 and new sections
32Q(8) and (9) in Division 4.
Section 32OA(4) introduces the concept of initial transaction
and latter transaction. Section 32OA(5) provides that an initial
transaction can be an option or, where there are serial subsequent
transactions, each subsequent transaction. Section 32OA(5)
provides that the latter transaction means a subsequent
15
transaction immediately following an initial transaction. Section
32OA(4) provides that where a partial transfer right is acquired
under a latter transaction an adjustment is to be made to the duty
to be charged under the initial transaction. An example is
provided explaining how the provisions work for an option
arrangement.
Section 32OB sets out how the dutiable value of transactions
under Division 3A is determined. In each case, it is the higher of
the amount for which the property might reasonably have been
sold if it had been sold, free from encumbrances, in the open
market on the date on which the option was granted or
subsequent transaction was entered into (as the case requires)
and--
• for an option referred to in section 32OA(1)(a)--the
consideration that would need to be given to complete
the sale or transfer contemplated by the option
(including any consideration already given for the
option);
• for a subsequent transaction--the consideration given or
agreed to be given by the subsequent purchaser or an
associate of the subsequent purchaser in order for the
subsequent purchaser to obtain or assume the transfer
right. This includes--
• any consideration given or agreed to be given to
obtain or assume the transfer right under the
option; and
• any consideration given or agreed to be given to
complete the sale or transfer contemplated by the
option.
The concept of 'excluded costs' is not relevant in determining
dutiable value for the purpose of Division 3A, but is relevant in
determining whether a subsequent purchaser or an associate has
provided additional consideration to trigger the application of the
division.
Section 32OC provides that a liability charged by Division 3A
arises when the transfer occurs.
Section 32OD(1) sets out who is liable to pay the duty charged
by Division 3A. Section 32OD(2) further provides the transferee
who pays duty payable under Division 3A by another person with
16
the right to recover the amount of that duty as a debt due to the
transferee from the other person.
Section 32OE provides that all Chapter 2 concessions and
specified Chapter 2 exemptions are available to transactions
under Division 3A, as is the case with Division 2, 3 and 4. A
specified Chapter 2 exemption is a Chapter 2 exemption other
than the Trusts and Superannuation exemptions in Division 1 and
2 of Part 5 of Chapter 2 and the Marriage and Domestic
Relationships exemption in section 43.
Clause 31 amends the heading to Division 4 of Part 4A of the Duties Act
2000. This amendment is required as with the insertion of
Division 3A into the Act there are now two divisions concerning
transfers resulting from options.
Clause 32 amends section 32P of the Duties Act 2000.
Subclause (1) amends paragraph 32P(1)(b) to reflect that what is
a transfer right for Division 4 is now provided for in section
32P(4), with section 32P(4) inserted by subclause (3).
Subclause (1) also makes a minor amendment to subsection
32P(1)(b)(iii).
Subclause (2) makes minor amendments to section 32P(2) and
(3) to ensure that the wording is consistent across Division 4.
Clause 33 amends section 32Q of the Duties Act 2000.
Subclauses (1) and (3) make minor amendments to section
32Q(1)(b) and section 32Q(5) respectively to ensure the wording
is consistent across Division 4.
Subclause (2) inserts new a provision that provides the option is
not to be charged with duty if duty is charged on the option under
Division 3A. This is consistent with Division 3A now being the
primary division to apply where a transfer right is obtained or
assumed under an option arrangement with Division 4
complementing new Division 3A in the same way as Division 3
complements Division 2.
17
Subclause (3) also repeals subsection 32Q(5)(c) which currently
provides that no duty is charged under Division 4 on the dutiable
value of a subsequent transaction referred to in subsection
32Q(1)(c) if duty is charged on the subsequent traction under
Division 2 or 3 of Part 4A. This will be provided for under new
section 32Q(7) which is inserted by subclause (4). The new
section has been extended to also refer to Division 3A. Further,
section 32Q(7) also provides that no duty is charged under
Division 4 on the final subsequent transaction referred to in
section 32Q(1)(b) if duty was charged on the subsequent
transaction under Division 2, 3 or 3A. Section 32Q(7) ensures
only one lot of duty is payable on a subsequent transaction under
Part 4A. The provision is not intended to provide an exemption
from duty and will only apply if duty has been charged on the
subsequent transaction under Division 2, 3 or 3A.
Subclause (4) also inserts new sections 32Q(8) and (9). Section
32Q(8) and (9) provide for how duty is charged under Division 4
where a partial transfer right is acquired. The provisions mirror
the new sections 32C(5) and (6) in Division 2, new sections
32J(7) and (8) in Division 3 and new sections 32OA(4) and (5) in
Division 3A.
Section 32Q(8) introduces the concept of initial transaction and
latter transaction. Section 32Q(9) provides that an initial
transaction can be the sale contract or, where there are serial
subsequent transactions, each subsequent transaction. Section
32Q(9) provides that the latter transaction means a subsequent
transaction immediately following an initial transaction. Section
32Q(8) provides that where a partial transfer right is acquired
under a latter transaction an adjustment is to be made to the duty
to be charged under the initial transaction. An example is
provided explaining how the provisions work for an option
arrangement.
Clause 34 amends section 32R of the Duties Act 2000.
Subclause (1) makes a minor amendment to section 32R(2)(a) to
ensure the wording is consistent across Division 4. It also
removes the reference to 'excluded costs' in the section. As a
result, excluded costs are no longer relevant when determining
the dutiable value of a subsequent transaction under Division 4.
18
Subclause (2) repeals section 32R(3). The provision is no longer
relevant as the acquisition of a partial transfer right under
Division 4 will be considered under section 32Q(8).
Clause 35 amends section 32T(1)(c) of the Duties Act 2000 to ensure the
wording is consistent across Division 4.
Clause 36 amends sections 32U(1) and (3) of the Duties Act 2000 to
substitute the words "this Chapter" with "a specified Chapter 2
exemption". The effect of this amendment is to restrict certain
Chapter 2 exemptions from applying to transactions under
Division 4. The amendment removes the availability of the
Trusts and Superannuation exemptions in Division 1 and 2 of
Part 5 of Chapter 2 and the Marriage and Domestic Relationships
exemption in section 43. These exemptions will continue to be
available after the property has been transferred to the transferee.
Further, the specific sub-sale exemption in section 32W for
transactions between relatives will continue to be available.
Clause 37 amends section 32V of the Duties Act 2000. The amendments
are minor and made to ensure the wording is consistent across
Division 4.
Division 4--Offences
Clause 38 amends section 24(6) of the Duties Act 2000.
Subclause (1) increases the statutory maximum penalty in section
24(6) to 600 penalty units for a body corporate or 120 penalty
units in any other case.
Subclause (2) inserts new subsection (6A) to provide that a
person does not commit an offence against section 24(6) if the
person has a reasonable excuse for a failure to disclose details in
accordance with that section.
Clause 39 substitutes the "misleading information" offence in section
69D(2) of the Duties Act 2000 to apply to the provision of false
or misleading information, and to omissions made, without
reasonable excuse; to increase the statutory maximum penalty to
600 penalty units for a body corporate or 120 penalty units in any
other case; and for criminal liability to extend to officers of a
body corporate for a failure to exercise due diligence in
accordance with section 130B of the Taxation Administration
Act 1997.
19
Clause 40 amends the "misleading information" offence in section 89O(2)
of the Duties Act 2000 to apply to the provision of false or
misleading information, and to omissions made, without
reasonable excuse and to increase the statutory maximum penalty
to 600 penalty units for a body corporate or 120 penalty units in
any other case. Criminal liability extends to officers of a body
corporate for a failure to exercise due diligence in accordance
with section 130B of the Taxation Administration Act 1997.
Division 5--Marriage and domestic relationships exemption
Clause 41 substitutes section 43 and inserts new sections 43A to 43D of the
Duties Act 2000 in relation to an exemption for the transfer of a
principal place of residence between domestic partners or
spouses.
New section 43(1) and (2) provides that no duty is chargeable
under Chapter 2 in respect of a transfer of dutiable property from
one person to another person, or from two persons to one of
them, or from one person to themselves and another person if--
• the persons are spouses or domestic partners of each
other; and
• no other person takes or is entitled to take an interest in
the property under the transfer; and
• there is no consideration for the transfer; and
• the property is residential property.
New section 43A(1) and (2) provides that the exemption in
section 43 is subject to the requirement that at least one of the
persons to the marriage or domestic relationship occupy the land
as their principal place of residence for a continuous period of at
least 12 months commencing within the 12 month period
immediately after the transfer.
New section 43B(1) provides that the Commissioner may, if
there are good reasons to do so--
• reduce the required period of residence; or
• determine that a temporary absence from residence does
not break the continuity of residence; or
• extend the period in which residency must begin.
20
New section 43B(2) provides that if the Commissioner
determines that a temporary absence from residence does not
break the continuity of residence, the person who received an
exemption under section 43 is not entitled to an exemption under
that section in respect of any other transfer during the period of
temporary absence unless the person pays duty on the original
transfer, subject to any other exemption or concession.
New section 43B(3) states that if a person who is occupying the
land as their place of residence, or is temporarily absent from the
land in accordance with section 43B(1), dies, the requirement in
section 43A is taken to have been complied with.
New section 43C(1) and (2) provide that the Commissioner may
reassess duty if the residence requirement is not met with the
liability for duty arising when the required period of residence for
the transfer is not complied with.
New section 43C(3) provides that the Commissioner is
authorised to reassess duty if more than 5 years have passed since
the initial assessment was made.
New section 43C(4) states that if the residence period has not
been complied with, the person who received the exemption is
not entitled to an exemption under section 43 in respect of any
other transfer until the person has paid duty for which the person
is liable because of this section.
New section 43D(1) and (2) requires that a person who has
received the duty exemption under section 43 must notify the
Commissioner in writing within 30 days after becoming aware of
any circumstances that may result in the residence requirement
not being complied with. However, such a failure to notify does
not affect the Commissioner's power to reassess duty under
section 43C or exercise a discretion under section 43B.
Division 6--Financial exchanges
Clause 42 amends section 3(1) of the Duties Act 2000 to provide that the
London Stock Exchange and the New York Stock Exchange are
recognised as acceptable exchanges for listed company and listed
trust status. The London Stock Exchange and the New York
Stock Exchange are two of the largest and most reputable
exchanges in the world. They had ceased being members of the
World Federation of Exchanges for reasons other than not
meeting the criteria for membership. As a result of the
21
amendments, the definitions of listed company and listed trust in
section 3(1) now specifically refer to the London Stock Exchange
and the New York Stock Exchange. Further, as part of these
amendments a transitional provision has been inserted so that the
definitions are taken to have always included a reference to the
London Stock Exchange and the New York Stock Exchange--
see clause 44, which inserts new clause 40 of Schedule 2.
Clause 43 inserts section 71(5) of the Duties Act 2000. It provides that a
landholder that is a private company or private unit trust scheme
is taken to be a listed company or public unit trust scheme if
certain requirements are satisfied. The requirements are that all
the shares in the company or units in the unit trust scheme have
been quoted on an exchange that has ceased to be a member
exchange of the World Federation of Exchanges and the
Commissioner is satisfied it is appropriate for the landholder to
be treated as a listed company or public unit trust scheme. The
provision is intended to address the situation where a reputable
exchange ceases to be a member of the World Federation of
Exchanges for reasons other than not meeting the membership
criteria, such as when the London Stock Exchange ceased
membership of the World Federation Exchanges. The provision
enables a company or unit trust scheme listed on such an
exchange to be treated as a listed company or public unit trust
scheme for the purpose of the landholder provisions, thus
preventing the conversion of the company or unit trust scheme to
private for those provisions. The 12 month requirement for the
shares or units to be quoted on the exchange ensures that the
provision cannot be used to circumvent section 88 of the Act.
Clause 44 inserts new clause 40 of Schedule 2 of the Duties Act 2000.
Clause 40 provides specific arrangements for the amendments to
the listed company and listed trust definitions in section 3(1). It
provides that the definitions are taken to have always included a
reference to the London Stock Exchange and the New York
Stock Exchange. This ensures a landholder that has all shares or
units quoted on the London Stock Exchange or New York Stock
Exchange prior to the amendments to the listed company and
listed trust definitions will not convert from private to public but
will always be considered to have been a listed company or listed
trust.
22
Division 7--General insurance
Clause 45 substitutes section 196(e) of the Duties Act 2000 with a new
paragraph (e).
Section 196(e) provides an exemption from insurance duty.
Previously section 196(e) only exempted insurance against
damage by hail to cereal or fruit crops. The new section expands
the exemption. The new section provides an exemption for crop
insurance covering all crops of grain, fruit, vegetables or other
plants. The section also now provides an exemption for livestock
insurance and insurance covering the breakdown of or physical
damage to agricultural machinery.
Division 8--Motor vehicle duty
Clause 46 amends sections 218 of the Duties Act 2000 so that the motor
vehicle duty rate that applies to new and near new motor vehicles
is the same rate that applies for used vehicles, being $8.40 per
$200 or part thereof.
Division 9--Transitional arrangements
Clause 47 inserts new clauses 41 to 42 in Schedule 2 of the Duties Act
2000.
Clause 41 sets out transitional arrangements for the application of
new Division 3A of Part 4A of Chapter 2. Division 3A treats
transactions arising from arrangements where additional
consideration has been given to obtain or assume a transfer right
under an option as a sub-sale of land. Clause 41 provides that the
division does not apply to a transfer of dutiable property resulting
from an option that was granted before the commencement of
Division 3A.
Clause 42 sets out transitional arrangements for the recasting of
the off-the-plan concession and refurbishment concession and the
changes that apply to principal place of residence and first home
purchases. Clause 42 provides that the new provisions apply to
transfers arising from a contract of sale entered on or after 1 July
2017. Where a contract of sale is entered into prior to 1 July
2017 and a nomination of a substitute purchaser occurs after 1
July 2017 the new provisions will not apply to the subsequent
transfer.
23
Part 3--Amendment of the First Home Owner Grant Act 2000
Part 3 of the Bill amends the First Home Owner Grant Act 2000 to exempt
permanent members of the Defence Force from the residence requirement.
Part 3 of the Bill also increases the rate of the first home owner grant to
$20 000 for eligible transactions to purchase a new home on land which will
be situated wholly in regional Victoria.
Clause 48 inserts new section 12(4) and (5) of the First Home Owner
Grant 2000 in relation to the residence requirement.
New section 12(4) provides that an applicant is exempted from
compliance with the residence requirement if, at the time of
completion of the eligible transaction, the applicant is a member
of the Defence Force and is enrolled on the register of electors.
If an application is made by joint applicants, at least one of the
applicants must be a member of the Defence Force and each of
the applicants is enrolled on the register of electors.
New section 12(5) provides that member of the Defence Force
means a member of the Permanent Forces within the meaning of
the Defence Act 1903 of the Commonwealth. The register of
electors has the same meaning as in the Electoral Act 2002.
Clause 49 inserts new section 18(1B) and (1C) and substitutes section
18(4C) of the First Home Owner Grant 2000 in relation to the
amount of the grant.
New section 18(1B) provides that, if the commencement date of
an eligible transaction is on or after 1 July 2017 and before 1 July
2020 and the conditions in section 18(1C) are satisfied, the first
home owner grant amount is the lesser of the consideration for
the eligible transaction or $20 000.
New section 18(1C) provides the conditions for the first home
owner grant amount in section 18(1B): that the eligible
transaction is a contract for the purchase of a new home and the
land on which the new home will be situated is wholly in
regional Victoria.
Substituted section 18(4C)(a) provides that where the
Commissioner is satisfied that a contract that formed the basis of
the eligible transaction replaces a contract made before 1 July
2013 for a contract for the purchase of the same home or a
comprehensive home building contract to build the same home or
24
a substantially similar home, then the amount of the grant is that
stated in section 18(1).
Substituted section 18(4C)(b) provides that where the
Commissioner is satisfied that a contract that formed the basis of
the eligible transaction replaces a contract made on or after 1 July
2013 and before 1 July 2017 for a contract for the purchase of the
same home or a comprehensive home building contract to build
the same home or a substantially similar home, then the amount
of the grant is that stated in section 18(1A).
Part 4--Amendment of Land Tax Act 2005
Part 4 of the Bill amends the Land Tax Act 2005 to introduce vacant
residential land tax, which imposes tax on residential land that is unoccupied
for a period of 6 months or more in a year, at a rate of 1% of the capital
improved value of the land.
Clause 50 inserts new definitions of capital improved value, commercial
residential premises, vacant residential land tax and VRT land
in section 3(1) of the Land Tax Act 2005.
Capital improved value is defined as having the same meaning as
in the Valuation of Land Act 1960.
Commercial residential premises is defined as having the same
meaning as in the A New Tax System (Goods and Services Tax)
Act 1999 of the Commonwealth.
Vacant residential land tax is defined to mean land tax imposed
under the new Division 6 of Part 2 of the Land Tax Act 2005.
VRT land is defined to mean taxable land that is residential (as
defined in new section 34B), vacant (as defined in new section
34C) and within the specific geographic area (as defined in new
section 34D).
This clause also moves the existing definitions of residential care
facility, retirement village and supported residential service to
section 3(1) of the Land Tax Act 2005.
Clause 51 amends the note to section 7 of the Land Tax Act 2005, which
sets out the types of land tax imposed under the Land Tax Act
2005.
25
Clause 52 amends section 19 of the Land Tax Act 2005 to specify that for
the purpose of calculating vacant residential land tax, the taxable
value of land is an amount equal to the capital improved value of
the land at the relevant date. The relevant date is defined in
section 19(2) of the Land Tax Act 2005.
Clause 53 inserts a new Division 6 into Part 2 of the Land Tax Act 2005,
which comprises new sections 34A to 34G.
New section 34A imposes vacant residential land tax on taxable
land that is residential land which is vacant and within the
specified geographic area, noting that there are certain
exemptions provided for under Division 9 of Part 4 of the Land
Tax Act 2005.
New section 34B specifies that for the purposes of the new
Division, residential land is land that is capable of being used
solely or primarily for residential purposes. It also provides that
residential land includes land that was capable of being used
solely or primarily for residential purposes and on which a
residence is being constructed or renovated that will be capable
of being used for residential purposes on completion. Section
34B(3) clarifies that residential land does not include commercial
residential premises, residential care facilities, supported
residential services or retirement villages.
New section 34C(1) sets out that residential land is vacant in a
tax year if it has not been used and occupied in the previous year
for a period of more than 6 months, whether continuously or in
aggregate. The use and occupation must either be as the
principal place of residence of the land owner or the owner's
permitted occupant, or alternatively the land must be occupied by
a natural person under a genuine lease or short-term letting
arrangement. The lease may be either a long-term lease or a
number of short-term leases or letting arrangements.
New section 34C(2) provides that residential land on which a
residence is being constructed or renovated will be considered
vacant in a tax year if at the end of the year preceding the tax
year, more than two years had elapsed since the construction or
renovation commenced. However, if the Commissioner is
satisfied that there is an acceptable reason for the construction or
renovation not being completed by the end of the year preceding
the tax year, the land will not be considered vacant.
26
New section 34C(4) provides that the date on which construction
or renovation commences is the date of issue of the building
permit for the construction or renovation.
New section 34C(5) defines a permitted occupant to mean a
person (other than a tenant) who uses and occupies the residential
land with the permission of the owner.
New section 34D provides that the specified geographic area is
the area comprising 16 municipal council districts which are
listed in new Schedule 2A to the Land Tax Act 2005 (inserted
by clause 66).
New section 34E provides that the owner of residential land that
is vacant and within the specified geographic area is liable to pay
vacant residential land tax. An owner of land is defined in
section 10 of the Land Tax Act 2005, but for the purposes of the
vacant residential land tax, a mortgagee in possession or a holder
of a beneficial interest in a trust who is deemed to be an owner of
land under the Land Tax Act 2005 is not liable to pay vacant
residential land tax.
New section 34F specifies that vacant residential land tax must
be paid before the date specified in a notice of assessment, which
must not be less than 14 days after the notice is served on a
taxpayer.
New section 34G requires an owner of vacant residential land to
notify the Commissioner of such by 15 January in each tax year
and provide any information that the Commissioner requests in
the form determined by the Commissioner.
Clause 54 amends section 35 of the Land Tax Act 2005 to provide that the
rate of vacant residential land tax is 1% of the taxable value of
the land (and notes that for the purposes of assessing vacant
residential land tax, the taxable value of land is the capital
improved value of the land).
Clause 55 amends section 37 of the Land Tax Act 2005 to provide that it
does not apply to vacant residential land tax.
Clause 56 inserts new section 37A into the Land Tax Act 2005 which
provides that a taxpayer is to be assessed for vacant residential
land tax on a single holding basis; that is, an owner of vacant
residential land is to be assessed as if the vacant residential land
is the only land owned by the taxpayer.
27
Clause 57 amends section 38 of the Land Tax Act 2005 to provide that it
does not apply to vacant residential land tax.
Clause 58 inserts new section 38A into the Land Tax Act 2005 which
provides that joint owners of land are to be jointly assessed for
vacant residential land tax as if the vacant residential land was
owned by a single person. There will be no secondary individual
assessments issued to each of the joint owners.
Clause 59 amends section 42 of the Land Tax Act 2005 to provide that it
does not apply to vacant residential land tax.
Clause 60 amends section 46 of the Land Tax Act 2005 to provide that
where it is necessary to assess vacant residential land tax on a
part of land, vacant residential land tax attributable to that part is
the proportion of vacant residential land tax, assessed on the
taxable value of the whole of the land, that the taxable value of
the part bears to the taxable value of the whole land.
Clause 61 amends section 50 of the Land Tax Act 2005 to provide that
where a corporation is liable to pay vacant residential land tax,
that corporation will not be grouped with other related
corporations and will be assessed individually for the purpose of
paying vacant residential land tax.
Clause 62 makes a consequential amendment to section 56(1A)(b)(ii) of the
Land Tax Act 2005, as a result of the definition of residential
care facility and supported residential service being moved to
section 3(1) of the of the Land Tax Act 2005.
Clause 63 makes a consequential amendment to section 78(3) of the Land
Tax Act 2005, as a result of the definition of retirement village
being moved to section 3(1) of the of the Land Tax Act 2005 .
Clause 64 makes a consequential amendment to section 78A(8) of the Land
Tax Act 2005, as a result of the definitions of residential care
facility, retirement village and supported residential service
being moved to section 3(1) of the of the Land Tax Act 2005.
Clause 65 inserts a new Division 9 into Part 4 of the Land Tax Act 2005,
which comprises new sections 88A to 88D.
Section 88A provides an exemption from vacant residential land
tax for land that is used and occupied as a holiday home for at
least 4 weeks in the year preceding the tax year, on the condition
28
that the owner of the land for which the exemption is being
sought also used and occupied other land in Australia as their
principal place of residence in the year preceding the tax year. In
addition, the Commissioner must be satisfied that the residential
land for which the exemption is being sought is a genuine holiday
home. The Commissioner will have regard to the location of the
purported holiday home, the distance between the owner's
principal place of residence and the purported holiday home and
the nature and frequency of the use of the purported holiday
home. An owner may only claim an exemption in respect of one
holiday home in a tax year.
Section 88B provides an exemption from vacant residential land
tax for land that is used and occupied for the purpose of attending
the owner's place of employment or business for an aggregate
period of at least 140 days in the year preceding the tax year, on
the condition that the owner of the land for which the exemption
is being sought also used and occupied other land in Australia as
their principal place of residence in the year preceding the tax
year. The owner's place of employment or business must be
within the specified geographic area as defined in section 34D of
the Land Tax Act 2005.
Section 88C provides an exemption from vacant residential land
tax for land that has changed ownership in the year preceding the
tax year.
Section 88D provides an exemption from vacant residential land
tax for land that becomes residential land during the year
preceding the tax year.
Clause 66 inserts Schedule 2A into the Land Tax Act 2005. Schedule 2A
sets out the 16 local municipal Council areas within which
residential land that is vacant is subject to the vacant residential
land tax.
Clause 67 inserts new clause 16 in Schedule 3 to the Land Tax Act 2005 to
provide for transitional arrangements for the introductory year of
the vacant residential land tax.
New clause 16 provides that for the 2018 tax year, all residential
land within the specified geographic area will be considered
occupied for the first 4 months of the 2017 calendar year, being
the year preceding the 2018 tax year.
29
New clause 16(2) and 16(3) provide that where a residence is
being constructed or renovated on land on 1 January 2018, for
which a building permit was issued before 31 December 2017,
for the purpose of determining whether the residential land is
vacant under section 34C(2), the construction or renovation will
be taken to have commenced on 31 December 2017.
Part 5--Amendment of Payroll Tax Act 2007
Part 5 of the Bill amends the Payroll Tax Act 2007 to insert new definitions
of a regional employee, a regional employer, and regional Victoria and to
provide a reduced rate of payroll tax of 3*65% for a regional employer.
Part 5 also brings forward the previously enacted increases to the annual
threshold amount and monthly base deductable amount.
Clause 68 inserts new definitions of regional employee, regional employer,
and regional Victoria in section 3 of the Payroll Tax Act 2007.
Regional employee is defined as being an employee of a regional
employer who, in a month, performs services for the employer
mainly in regional Victoria.
Regional employer has the meaning given in new section 3A.
Regional Victoria is defined as having the same meaning as it
has in section 18(8) of the First Home Owner Grant Act 2000
(FHOG Act). The FHOG Act defines regional Victoria as the
municipal councils set out in Schedule 1 of that Act (which lists
48 rural based municipal councils) and the alpine resorts within
the meaning of the Alpine Resorts Act 1983.
These definitions are necessary to define the employers that are
eligible for the reduced rate of payroll tax of 3*65%.
Clause 69 inserts new section 3A into the Payroll Tax Act 2007 to define a
regional employer. A regional employer is an employer who has
an ABN and a registered business address located in regional
Victoria or an employer whose principal place of business is
located in regional Victoria (if that employer does not have an
ABN) and who meets the specified requirements.
30
The specified requirements are that--
• at least 85% of the total taxable Victorian wages paid or
payable by the employer to the employer's employees
during a month are paid or payable to the employer's
regional employees (monthly rate reduction threshold);
and
• for a financial year, at least 85% of the total taxable
Victorian wages paid or payable by the employer to the
employer's employees are paid or payable to the
employer's regional employees during that year (annual
rate reduction threshold).
For the purposes of determining the annual rate reduction
threshold, it is not necessary that the employer met the monthly
rate reduction threshold each month.
For example, a regional based employer pays total taxable wages
each month of $100 000. The employer paid wages to its
regional employees during a financial year as follows--$90 000
for each of the months July to October, $80 000 for each of the
months November to February and $90 000 for each of the
months March to June.
The employer meets the monthly rate threshold deduction for the
months of July to October and March to June (as it meets the
85% requirement) but not for the months November to February.
For the purposes of determining the annual rate reduction
threshold, the wages paid to its regional employees during the
months November to February are taken into account even
though the employer did not meet the monthly rate reduction
threshold in those months. The total taxable wages paid or
payable by the employer to its regional employees during the
year is $1 040 000. As this amount represents 86*67% of its total
taxable wages for the financial year, the employer meets the 85%
test and will pay payroll tax on its total taxable wages for the
financial year at the rate for regional employers.
Clause 70 inserts new section 12A into the Payroll Tax Act 2007 which
provides for additional matters for determining whether an
employer is a regional employer.
Subclause (1) provides that these additional matters do not limit
Division 2, which set out which wages are taxable in Victoria.
31
Subclause (2) provides that--
• if an employer carries on a business under a trust, the
employer's registered business address is the trust's
registered business address or, if the trust does not have
an ABN, the trustee's registered business address, where
the trustee has an ABN; and
• if an employer based in Victoria has registered business
addresses located in and outside regional Victoria at the
same point in time, the location where that employer is
based is made by reference to where the employer's
principal place of business is located.
Subclause (3) provides that--
• the location at which the employer is based is to be
determined by reference to the state of affairs existing
during the month in which the relevant wages are paid
or payable; and
• if more than one location in Victoria would qualify as a
location at which the employer is based during a month,
the location is to be determined by reference to the state
of affairs existing on the last day of that month.
Clause 71 amends the definition of "R" and the definition of threshold
amount in clause 1 of Schedule 1 to the Payroll Tax Act 2007.
The term "R" in Schedule 1 specifies the rate of payroll tax for
the relevant financial year. This clause amends "R" to provide
that the rate for the financial year commencing on 1 July 2017 or
any subsequent financial year is 3*65% in the case of a regional
employer and 4*85% for all other employers.
The threshold amount is used to determine the amount that is
deducted from the total taxable wages for a financial year to
calculate the wages that are subject to payroll tax. The increase
to the threshold amounts are being brought forward so that the
threshold amount for the financial year commencing on 1 July
2017 is $625 000 and for the financial year commencing on 1
July 2018 and each subsequent financial year is $650 000.
32
Clause 72 inserts definitions of D, JTW, P e , P re , R e and R re in clause 7 of
Schedule 1 to the Payroll Tax Act 2007.
D is the deductible amount determined in accordance with new
clause 7A of Schedule 1.
JTW represents the total taxable wages paid or payable during
the relevant financial year by the employers covered by the return
(as members of a group) where an approval under section 87(2) is
in force.
P e is that part of the JTW that is attributable to all employers who
are not regional employers.
P re is that part of the JTW that is attributable to all regional
employers.
R e is the percentage specified in paragraph (e)(ii) of the
definition of R.
R re is the percentage specified in paragraph (e)(i) of the
definition of R.
These new definitions are necessary in order to calculate the
payroll tax payable for groups with a designated group employer,
where an approval under section 87(2) is in force, which may
include a regional employer.
Clause 73 inserts new clause 7A in Schedule 1 to the Payroll Tax Act
2007, which contains the formula for calculating the deductible
amount (D) for groups with a designated group employer. This
simplifies the formulas used in new clauses 9 and 9A of the
Schedule for calculating the payroll tax for groups where an
approval under section 87(2) is in force.
Clause 74 substitutes clause 9 and insets new clauses 9A and 9B in
Schedule 1 to the Payroll Tax Act 2007. These clauses contain
the formulas for calculating the amount of payroll tax payable for
the financial year for groups with a designated group employer
paying wages over the threshold.
The substituted clause 9 specifies the amount of payroll tax
payable for groups where an approval under section 87(2) is in
force for the designated group employer of the group to lodge a
joint return covering the specified members, where the members
covered by the return are either all regional employers or not. In
the case where all members covered by the return are regional
33
employers, the payroll tax payable is assessed at the rate for
regional employers. Otherwise the payroll tax is assessed at the
rate for employers who are not regional employers. The payroll
tax payable by members of the group not covered by the return is
assessed at the applicable rate (3*65% in the case of a regional
employer and 4*85% in any other case).
New clause 9A specifies the amount of payroll tax payable for
groups where an approval under section 87(2) is in force for the
designated group employer of the group to lodge a joint return
covering the specified members, where at least one, but not all of
the members covered by the return, is a regional employer.
The payroll tax payable is calculated at the rate for regional
employers based on the proportion of the total taxable wages paid
or payable by the members covered by the return (after
subtracting the relevant deduction) that is attributable to the
members who are regional employers plus at the rate for
employers who are not regional employers on the proportion of
the total taxable wages paid or payable by the members covered
by the return (after subtracting the relevant deduction) that is
attributable to the members who not are regional employers.
For example, a group consists of 3 employers who have been
given approval to lodge a joint return. Employer 1 paid wages of
$400 000 for the financial year, Employer 2 (who is a regional
employer) paid wages of $300 000 and Employer 3 paid wages of
$200 000. The total wages paid by the three group employers for
the financial year is $900 000. The deduction amount for the
financial year is $600 000. Therefore, the wages liable to
payroll tax are $300 000. One-third of the total taxable wages is
paid by the regional employer (Employer 2). Therefore, one-
third of the wages liable to payroll tax ($100 000) is assessed at
the regional employer tax rate of 3*65% and the remaining two-
thirds ($200 000) is assessed at the tax rate of 4*85%.
New clause 9B specifies the amount of payroll tax payable for
groups where an approval under section 87(2) is in not force.
The designated group employer must pay payroll tax on its total
taxable wages, less the deduction amount. The other members of
the group must pay payroll tax on their total taxable wages. The
rate of tax depends on whether or not the member is a regional
employer. If the member is a regional employer, the tax is
assessed at the rate of 3*65%. If the member is not a regional
employer, the tax is assessed at the rate of 4*85%.
34
Clause 75 amends clause 1A of Schedule 2 to the Payroll Tax Act 2007
(which sets out the base deductible amount used for the purposes
of calculating the monthly payroll tax payable by an employer).
This clause brings forward the increases to the base deductible
amount.
This clause provides that the base deductible amount for a month
in a financial year commencing on 1 July 2017 is $52 083 and for
a month in a financial year commencing on 1 July 2018 and each
subsequent financial year is $54 166.
Clause 76 amends clause 2(d) of Schedule 2 to the Payroll Tax Act 2007,
which specifies the rate of payroll tax for wages paid or payable
on or after 1 July 2014.
This clause provides that the rate of payroll tax is--
• on or after 1 July 2017, 3*65% in the case of a regional
employer; and
• on or after 1 July 2014, 4*85% for all other employers
(as is currently the case).
Clause 77 substitutes clause 8 and inserts new clauses 8A and 8B of
Schedule 2 to the Payroll Tax Act 2007.
Clause 8 currently specifies the amount of payroll tax to be paid
each month by employers that are a member of a group. Clause
8(1) specifies the monthly payroll tax to be paid where approval
under section 87(2) has been given for group members to lodge a
joint return. Clause 8(2) specifies the monthly payroll tax to be
paid where approval has not been given for members to lodge a
joint return.
The substituted clause 8 and new clause 8A deal with members
that have been given approval to lodge a joint return. The
substituted clause 8 specifies the monthly payroll tax to be paid
in the case where--
• all the members covered by the joint return are regional
employers, in which case the applicable rate of payroll
tax is 3*65%; or
• none of the members covered by the joint return are
regional employers, in which case the applicable rate of
payroll tax is 4*85%.
35
New clause 8A specifies the monthly payroll tax to be paid where
at least one, but not all of the members covered by the joint
return, is a regional employer. The payroll tax payable for the
month is calculated at the rate for regional employers on the
proportion of the total taxable wages paid or payable by the
members covered by the return (after subtracting the monthly
deduction amount) that is attributable to the regional employers
plus at the rate for employers who are not regional employers on
the proportion of the total taxable wages paid or payable by the
members covered by the return (after subtracting the monthly
deduction amount) that is attributable to the members who are
not regional employers.
For example, 3 employers are members of a group and approval
has been given for them to lodge a joint return. Employer 1 paid
wages of $40 000 for the month, Employer 2 (who is a regional
employer) paid wages of $30 000 and Employer 3 paid wages of
$20 000. The total wages paid by the 3 group employers for the
month is $90 000. The monthly deduction amount is $50 000.
Therefore payroll tax is payable on the net taxable wages of
$40 000.
One-third of the total taxable wages is paid by the regional
employer (Employer 2). Therefore, one-third of the net taxable
wages ($13 333) is assessed at the regional employer tax rate of
3*65% and the remaining two-thirds ($26 667) is assessed at the
tax rate of 4*85%.
New clause 8B specifies the monthly payroll tax to be paid by
members of a group where approval has not been given to lodge
a joint return. Each member is required to lodge their own return
and pay payroll tax at the applicable rate. If the member is a
regional employer, it will pay at the rate of 3*65%, if the member
is not a regional employer, it will pay at the rate of 4*85%.
Clause 78 makes consequential amendments to the variable "R" in the
formulas set out in clauses 4 and 12 of Schedule 2 to the Payroll
Tax Act 2007. The variable "R" in those formulas is the rate of
payroll tax referred to in clause 2 of Schedule 2. The amendment
inserts the word "applicable" before "rate".
These amendments are necessary so that "R" refers to the
applicable rate in clause 2 of Schedule 2 (3*65% in the case of a
qualifying regional employer and 4*85% in all other cases).
36
Part 6--Amendment of Planning and Environment Act 1987
Part 6 of the Bill amends the Planning and Environment Act 1987 to
provide for the rounding of the CPI adjusted metropolitan planning levy
threshold amount to the nearest $1000.
Clause 79 inserts new section 96R(1A) into the Planning and
Environment Act 1987, which provides that the CPI adjusted
metropolitan planning levy threshold amount determined under
section 96R(1) is to be rounded up or down to the nearest $1000
(and if the amount to be rounded is $500, it is to be rounded up).
Part 7--Amendment of Taxation Administration Act 1997
Part 7 of the Bill amends the Taxation Administration Act 1997 in relation
to the definition of a taxation law for the purposes of that Act; in relation to
offences relating to false and misleading statements and omissions; to
authorise the collection and disclosure of information about transfers of
interests in real property for the purposes of reporting to the Commissioner of
Taxation of the Commonwealth; in relation to the disclosure of information
by taxation officers for verification purposes; and to enable the vacant
residential land tax to be administered in the same way as other land taxes.
Division 1--Meaning of taxation laws
Clause 80 amends section 4 of the Taxation Administration Act 1997.
Subclause (1) inserts new subsection (cab) after section 4(1)(ca)
to make Part 6 of the Livestock Disease Control Act 1994 and
any regulations made under that Act a taxation law so that the
data provided for the administration of livestock duty can also be
used for the administration of Victoria's taxation laws generally.
Subclause (2) repeals section 4(2) of the Taxation
Administration Act 1997. This has the effect of removing the
current restrictions in respect of Part 6 of the Livestock Disease
Control Act 1994.
Division 2--Record keeping and general offences
Clause 81 amends section 10 of the Taxation Administration Act 1997.
Subclause (1) increases the statutory maximum penalty for the
offence in section 10(1) to 600 penalty units for a body corporate
or 120 penalty units in any other case.
37
Subclause (2) inserts new subsection (1A) after section 10(1) to
provide that a person does not commit an offence against section
10(1) if the person has a reasonable excuse for failing to ensure
the information required by that section was included in the
instrument or a statement provided together with the instrument
prior to the payment of tax.
Subclause (3) increases the statutory maximum penalty for the
offence in section 10(2) to 600 penalty units for a body corporate
and 120 penalty units in any other case.
Subclause 4 inserts new subsection (2A) after section 10(2) to
provide that a person does not commit an offence against section
10(2) if the person has a reasonable excuse for failing to ensure
the information required by that section was included in the
return.
Clause 82 amends section 52(1) of the Taxation Administration Act 1997
to increase the statutory maximum penalty for the offence to
1200 penalty units for a body corporate or 240 penalty units in
any other case.
Clause 83 amends section 57 of the Taxation Administration Act 1997.
Subclause (1) amends section 57(1) to provide that a person must
not, without reasonable excuse, make statements or give
information to tax officers that is false or misleading in a material
particular.
Subclause (2) increases the statutory maximum penalty for the
offence in section 57(1) to 600 penalty units for a body corporate
or 120 penalty units in any other case.
Subclause (3) repeals section 57(2) to remove the current
provision for where a person did not know that a statement or
information was false or misleading in a material particular.
Clause 84 amends the offence in section 58 of the Taxation
Administration Act 1997 to increase the statutory maximum
penalty to 1200 penalty units for a body corporate or 240 penalty
units in any other case.
Clause 85 amends section 130A of the Taxation Administration Act 1997
to remove the reference to section 69D(2) of the Duties Act
2000. This amendment is made as a consequence of the
38
amendment to section 69D(2) of the Duties Act 2000 made by
clause 39 of the amending Bill.
Clause 86 amends section 130B of the Taxation Administration Act 1997
to insert a reference to section 69D(2) of the Duties Act 2000.
This amendment is made as a consequence of the amendment to
section 69D(2) of the Duties Act 2000 made by clause 39 of the
amending Bill.
Division 3--Reportable information
Clause 87 amends section 3(1) of the Taxation Administration Act 1997
to insert the definition of reportable information.
Clause 88 inserts new Division 2B into Part 9 of the Taxation
Administration Act 1997 which authorises the Commissioner
of State Revenue to collect reportable information for the
purposes of reporting to the Commissioner of Taxation of the
Commonwealth pursuant to section 396-55 of Schedule 1 to the
Taxation Administration Act 1953 of the Commonwealth and for
taxation law purposes.
New section 90F sets out the relationship with other laws.
Subsection (1) of new section 90F of the Taxation
Administration Act 1997 provides that nothing in that Act or
any other Act or law prevents the collection or disclosure of
reportable information in accordance with the new Division 2B.
Subsection (2) provides that nothing in the new Division 2B
prevents the collection or disclosure of reportable information in
accordance with any other provisions of the Taxation
Administration Act 1997 or any other Act or law.
New section 90G provides for the collection and disclosure of
reportable information.
Subsection (1) provides that the Commissioner of State Revenue
may collect reportable information for--
• the purposes of disclosing it to the Commissioner of
Taxation of the Commonwealth;
• the purposes of the administration or execution of a
taxation law.
39
Subsection (2) provides that the Commissioner may disclose
reportable information to the Commissioner of Taxation of the
Commonwealth.
New section 90H sets out how reportable information may be
collected.
Subsection (1) enables the Commissioner to collect reportable
information by requiring a person providing information for the
purposes of a function carried out under a taxation law to provide
the reportable information.
Subsection (2) provides that, without limiting subsection (1), the
Commissioner may require reportable information to be provided
in connection with the lodgment of an instrument, return or form
or the making of an application under a taxation law.
Subsection (3) makes it clear that nothing in the new section 90H
limits the circumstances in which the Commissioner may collect
reportable information.
Division 4--Data matching amendments
Clause 89 Subclause (1) inserts new paragraph (ba) into section 92(1) of the
Taxation Administration Act 1997. The new paragraph
provides that a tax officer may disclose information obtained
under or in relation to the administration of a taxation law to a
public service body for the purpose of verifying the information.
The recipient public service body would not be entitled to retain
or use that information for their own statutory purposes. This
amendment is not intended to expand the list of authorised
recipients in section 92(1)(e) who are authorised to use
information received from the State Revenue Office for the
purposes of the laws administered by those authorised recipients.
Subclause (2)(a) inserts a new definition of public service body
into section 92(2) of the Taxation Administration Act 1997.
The new definition is required as a consequence of inserting
new paragraph (ba) into section 92(1)(b) of the Taxation
Administration Act 1997.
Subclause (2)(b) substitutes "use;" for "use" in the definition of
Landata as a consequence of the insertion of the new definition
of public service body.
40
Division 5--Consequential amendments on imposition of vacant
residential land tax
Clause 90 inserts paragraph (aa) into the definition of notification default in
section 3(1) of the Taxation Administration Act 1997 to
provide a failure to lodge a notice under section 34G of the Land
Tax Act 2005 is a notification default.
Clause 91 amends section 30(2A) of the Taxation Administration Act
1997 to insert a reference to section 34G of the Land Tax Act
2005. Section 30(2A) provides for the increase in penalty tax in
relation to notification defaults.
Clause 92 inserts a new subsection (7) into section 135 of the Taxation
Administration Act 1997 to provide that it is the intention of
sections 5, 12(4), 18(1), 96(2) and 100(4) of the Taxation
Administration Act 1997, as those sections apply after the
commencement of section 92 of the State Taxation Acts
Amendment Act 2017, to alter or vary section 85 of the
Constitution Act 1975.
This amendment ensures the jurisdiction of the Supreme Court is
limited in relation to the administration of vacant residential land
tax in the same way as it is in relation to other forms of land tax.
Part 8--Amendment of Unclaimed Money Act 2008
Part 8 of the Bill amends the Unclaimed Money Act 2008 to update offence
provisions for giving false or misleading information.
Clause 93 amends section 25 of the Unclaimed Money Act 2008.
Section 25 is amended to provide that a person must not without
reasonable excuse, make the declarations or statements or give
the information that is false or misleading to an authorised
person.
Section 25 is also amended so that the offence now extends to
omitting from a declaration or statement or information given to
an authorised person any matter or thing without which the
declaration, statement information is false or misleading in a
material particular.
Subclause (2) increases the statutory penalty for the offence in
section 25 to 600 penalty units for a body corporate or 120
penalty units for a natural person.
41
Subclause (3) amends the note at the foot of section 25 to refer to
"Section 26B" instead of "Section 26A".
The amendments to section 25 of the Unclaimed Money Act
2008 replicate the structure and penalty of the proposed new
claims offence, provide for reasonable excuse, extend criminal
liability to an officer of a body corporate where the body
corporate has committed the offence, and increase the statutory
maximum penalty.
Clause 94 repeals section 26A(2)(g) of the Unclaimed Money Act 2008,
which provides for the current accessorial liability of officers of
body corporate.
Clause 95 inserts paragraphs (ba) and (bb) into section 26B(2) of the
Unclaimed Money Act 2008 to provide that where a body
corporate commits an offence against section 25 or the proposed
new section 33A, criminal liability extends to an officer of the
body corporate for a failure to exercise due diligence.
Clause 96 inserts new subsection (1A) into section 33 of the Unclaimed
Money Act 2008 to provide that an application under section 33
must be in writing in the form approved by the Registrar of
Unclaimed Money, contain the information required by the
Registrar, and be accompanied by any document required by the
Registrar.
Clause 97 inserts new section 33A of the Unclaimed Money Act 2008.
New section 33A is an offence prohibiting the making of a
declaration or statement that is false or misleading in a material
particular, giving information that is false or misleading in a
material particular or omitting from a declaration, statement or
information given to the Registrar any matter or thing without
which the declaration, statement or information is false or
misleading in a material particular. This offence applies to a
person making an application for an amount of unclaimed money
under section 33(1) of the Unclaimed Money Act 2008.
The new offence only applies if a person does not have a
reasonable excuse. Criminal liability extends to officers of a
body corporate for failure to exercise due diligence under section
26B of the Unclaimed Money Act 2008. The new offence sets
out a maximum statutory penalty of 600 penalty units for a body
corporate and 120 penalty units for a natural person.
42
Part 9--Amendment of Valuation of Land Act 1960 and
other Acts
Part 9 of the Bill amends the Valuation of Land Act 1960 to centralise
the valuation function under the management of the valuer-general. The
amendments will give effect to the valuer-general being the sole valuation
authority who will conduct annual general valuations and supplementary
valuations of all lands, including transmission easements in Victoria for a
rating authority. Councils and collection agencies will no longer be
valuation authorities and councils will no longer be required to nominate
the valuer-general as their valuation authority. There are also consequential
amendments to the Land Tax Act 2005, Local Government Act 1989,
Co-operative Housing Societies Act 1958 and Water Act 1989 to give
effect to these changes.
Division 1--Amendment of Valuation of Land Act 1960
Clause 98 amends the relevant definitions in section 2(1) of the Valuation
of Land Act 1960.
Paragraph (a) repeals the definition of collection agency general
valuation as it is no longer required.
Paragraph (b) repeals the definition of council general valuation
as councils will no longer conduct a general valuation.
Paragraph (c) substitutes the definition of general valuation to
mean a valuation of all rateable land under Part II and all non-
rateable leviable land under Part IIA of the Valuation of Land
Act 1960.
Paragraph (d) amends the definition of notice of valuation to
omit reference to section 15(2)(a) as that section is repealed.
Paragraph (e) repeals the definition of relevant municipal district
as this definition is no longer required.
Paragraph (f) substitutes the definition of valuation authority, in
relation to a municipal district, to recognise the valuer-general as
the sole valuation authority.
Paragraph (g) repeals the definition of valuation authority, in
relation to non-rateable leviable land, as it is no longer required.
Paragraph (h) amends the definition of valuation record to
substitute the reference to "section 7C;" with "section 7C.".
This is consequential on the repeal of the definition of valuer-
general general valuation.
43
Paragraph (i) repeals the definition of valuer-general general
valuation as this category of general valuation will no longer
apply.
Clause 99 amends section 3(5) of the Valuation of Land Act 1960 to allow
the Chief Executive Officer of a council to request the valuer-
general, the deputy valuer-general or any valuer nominated by
the valuer-general to make valuations of land after payment of
the relevant fees.
Clause 100 amends section 3A(1) of the Valuation of Land Act 1960 to
omit reference to the Local Government Act 1989 as councils
will no longer conduct general valuations and will neither appoint
nor employ any valuer pursuant to the Local Government Act
1989.
Clause 101 amends section 5(1)(ab) of the Valuation of Land Act 1960 to
remove the requirement for a council or collection agency to
nominate the valuer-general to cause general valuations and
supplementary valuations as it is not necessary to do so.
Clause 102 amends section 5AA(1) of the Valuation of Land Act 1960 to
omit the word "biennial". This amendment is to give effect to the
change from a biennial to annual general valuations and to ensure
that the valuer-general must prepare the Valuation Best Practice
Specifications Guidelines at the commencement of every annual
valuation.
Clause 103 amends section 5B(2)(a) of the Valuation of Land Act 1960 to
give effect to the change from a biennial to an annual general
valuation so that the valuation of each transmission easement is
to be made as at 1 January in each calendar year. This clause
also repeals section 5B(2A) as the Minister is no longer required
to direct a general valuation under that section.
Clause 104 substitutes section 6(1) of the Valuation of Land Act 1960 to
recognise the role of the valuer-general as the sole valuation
authority. This amendment further provides that if the valuation
authority (the valuer-general) causes a general valuation to be
made, the valuation authority must give a notice within a month
of that decision to each rating authority interested in the valuation
of land in the area for which the valuation is being made.
44
Subclause (2) amends section 6(2) of the Valuation of Land Act
1960 to require a rating authority that requires a general valuation
to give a notice to the valuer-general upon receipt of a notice
given under section 6(1).
Subclause (3) repeals sections 6(3) and 6(4) of the Valuation of
Land Act 1960 as it is no longer necessary to refer to a council
general valuation.
Subclause (4) amends section 6(5) to clarify that any additional
costs incurred by a valuation authority in complying with a
requirement of a rating authority made pursuant to section 6(2)
must be met by the authority making the requirement.
Clause 105 repeals sections 7, 7AA, 7AB and 7AC of the Valuation of Land
Act 1960 as they relate to council general valuations or collection
agency general valuations which no longer apply.
Clause 106 amends section 7AD of the Valuation of Land Act 1960 to
remove the reference to a "valuer-general" general valuation as
this category of general valuation no longer applies.
Clause 107 repeals sections 7AE of the Valuation of Land Act 1960 as this
section relates to a council general valuation or collection agency
general valuation which no longer applies.
Clause 108 amends section 7AF of the Valuation of Land Act 1960 to
recognise the role of the valuer-general as the sole valuation
authority and to allow the Minister to declare that a general
valuation is generally true and correct.
Clause 109 amends section 7AH of the Valuation of Land Act 1960 to omit
the reference to section 7AG so that valuations given to councils
are taken to be made for rating purposes.
Clause 110 repeals sections 7A and 7B of the Valuation of Land Act 1960
as they no longer apply.
Clause 111 substitutes section 7C(1) of the Valuation of Land Act 1960.
This amendment ensures that the valuer-general maintains
valuation records for all general valuations and supplementary
valuations. Further, the amendment is necessary to remove the
references to the categories of general valuations which no longer
apply.
45
Clause 112 amends section 8AA(1A)(a) of the Valuation of Land Act 1960
to insert the words "the use of". This amendment ensures that a
council that uses the general valuation carried out by the valuer-
general pays a fee for a copy of the whole or part of the valuation
for use of the valuation.
Clause 113 repeals sections 9 of the Valuation of Land Act 1960 as a
council will no longer be a valuation authority.
Clause 114 substitutes section 10 of the Valuation of Land Act 1960 to
reflect that the valuer-general is the valuation authority in respect
of the municipal districts of all councils.
Clause 115 amends section 11 of the Valuation of Land Act 1960 to provide
that a general valuation is to be made every year and returned to
the valuer-general at a specified date. The general valuation is to
be provided to the council in the area for which the valuation of
land is made.
Clause 116 repeals sections 12 of the Valuation of Land Act 1960 as there
is no requirement for the Minister to direct a general valuation to
be made as at and returned before the dates other those specified
in section 11.
Clause 117 substitutes the heading in section 13DA of the Valuation of
Land Act 1960 with "Valuations for the purposes of the Local
Government Act 1989" as the reference to "council valuations'
in the heading is no longer relevant.
Subclause (2) repeals sections 13DA(3) of the Valuation of
Land Act 1960 as a council will no longer be a valuation
authority.
Clause 118 repeals sections 13DD and 13DE of the Valuation of Land Act
1960 as they no longer apply.
Clause 119 repeals section 13DF(3A) of the Valuation of Land Act 1960.
This provision no longer applies since a council can no longer
cause a supplementary valuation to be made.
Subclause (2) amends section 13DF(9) to remove the reference to
section 13DF(3A) as this section is repealed.
46
Clause 120 substitutes section 13DFA and 13DFB of the Valuation of Land
Act 1960.
New section 13DFA of the Valuation of Land Act 1960
provides that on being satisfied that a supplementary valuation
(made under section 13DF) is generally true and correct, the
valuer-general may certify the supplementary valuation.
New section 13DFB of the Valuation of Land Act 1960 allows
the valuer-general to cause a supplementary valuation under
section 13DF to be made if requested by a council.
Subsection (2) requires a request made by a council under
subsection (1) to be made to the valuer-general in writing and
accompanied by a report of the valuation data in the form
prescribed by the Valuation Best Practice Specifications
Guidelines.
Clause 121 repeals section 13DJ of the Valuation of Land Act 1960. This
section allows a person to apply to a council for a copy of the
most recent valuation of any rateable land in the Council's
municipal district. This section no longer applies as the valuer-
general is the valuation authority and maintains the valuation
records.
Clause 122 amends section 13E of the of the Valuation of Land Act 1960 to
remove the reference to "by a collection agency" as the collection
agency will no longer conduct a general valuation of non-rateable
leviable land.
Clause 123 repeals sections 13F of the Valuation of Land Act 1960 as a
collection agency will no longer be a valuation authority.
Clause 124 substitutes section 13G of the Valuation of Land Act 1960.
New section 13G provides that the valuer-general is the valuation
authority in respect of non-rateable leviable land not located in a
municipal district.
Clause 125 amends the heading in section 13H of the Valuation of Land
Act 1960 to substitute the words 'two years" with "each year" to
give effect to the change to an annual general valuation of non-
rateable leviable land. This amendment also clarifies that a
general valuation of non-rateable leviable land is to be made
every year and returned to the valuer-general at a specified date.
The general valuation is to be provided to the relevant collection
agency.
47
Clause 126 repeals sections 13I of the Valuation of Land Act 1960 as the
Minister is no longer required to direct a general valuation of
non-rateable leviable land to be made.
Clause 127 substitutes the heading in section 13J of the Valuation of Land
Act 1960 with "Valuation for the purposes of the Fire Services
Property Levy Act 2012" as the reference to "council valuations'
in the existing heading is not relevant.
Subclause (2) repeals sections 13J(3) of the Valuation of Land
Act 1960 as a council is no longer a valuation authority.
Clause 128 repeals section 13L(4) of the Valuation of Land Act 1960. This
provision no longer applies since a council will no longer be able
to cause a supplementary valuation to be made.
Clause 129 substitutes section 13M of the Valuation of Land Act 1960 to
provide that on being satisfied that a supplementary valuation
made under section 13L is generally true and correct, the valuer-
general may certify the supplementary valuation.
Clause 130 substitutes the words "on behalf of" with "if requested by" in
the heading in section 13N of the Valuation of Land Act 1960.
Subclause (2) amends section 13N(1) to refer to the valuer-
general as the valuation authority for the purposes of a
supplementary valuation made under section 13L.
Clause 131 repeals sections 13O and 13P of the Valuation of Land Act
1960 as they no longer apply.
Clause 132 amends section 15(1) of the Valuation of Land Act 1960 to
remove the words "that is not also a rating authority" to reflect
that the valuer-general is not a rating authority for the purposes of
the Valuation of Land Act 1960.
Subclause (2) repeals section 15(2) of the Valuation of Land
Act 1960 as council being a rating authority can no longer cause
a general valuation or supplementary valuation to be made.
Subclause (3) amends section 15(8) to remove the reference to
section 15(2)(b) as section 15(2) is repealed.
48
Division 3--Objections
Clause 133 repeals section 19 of the Valuation of Land Act 1960. As the
general valuation of land is to be made each year, the valuations
will be used for each rating or taxing year. If a person is
aggrieved by that valuation, they may object to that valuation
used in that year. Consequently, section 19 no longer applies to
prevent a further objection by that person to the same valuation
within 12 months.
Clause 134 repeals section 21(2) of the Valuation of Land Act 1960.
This section no longer applies as a council will no longer be a
valuation authority that caused a general valuation to be made.
Subclause (2) amends section 21(2A) to remove the reference to
subsection (2) as that subsection is repealed.
Subclause (3) substitutes the word "valuation" with "rating" in
section 21(3)(b)(ii) to allow a valuer of the valuer-general to give
a copy of the valuer's recommendation to a rating authority.
Subclause (4) amends section 21(5) to substitute the words "the
valuation authority and any other" with the words "and any".
This amendment is necessary because the valuer-general as a
valuation authority decides on the objection and there is no
requirement for the valuer-general to give a written notice of his
or her decision to himself or herself.
Clause 135 substitutes the words ", valuer or valuer-general (as the case
requires) with "or valuer (as the case requires)" in section
26(2)(g) of the Valuation of Land Act 1960. Section 26(2) sets
out the factors that the Victorian Civil and Administrative
Tribunal or Court must take into consideration in determining
any questions concerning costs orders made on a review or
appeal. One of these factors is stated in section 26(2)(g) which
relates to an excessively high value contended by the valuation
authority, valuer or valuer-general. As the valuer-general will be
the sole valuation authority, this provision is amended to remove
the reference to the valuer-general to avoid duplication.
Clause 136 inserts a new section 35 into the Valuation of Land Act 1960 to
provide for transitional arrangements.
Subclause (1) provides for the continuation of Division 3 of
Part III to apply to an objection to a general valuation or
supplementary valuation if the general valuation or
49
supplementary valuation was returned before the commencement
of Part 9 of the State Taxation Acts Amendment Act 2017.
Subclause (2) provides for the continuation of Division 4 of Part
III to apply to a review of a decision on an objection to a general
valuation or supplementary valuation if the general valuation or
supplementary valuation was returned before the commencement
of Part 9 of the State Taxation Acts Amendment Act 2017.
Subclause (3) provides for the continuation of Division 4 of Part
III to apply to a matter under section 22 that is treated as an
appeal to the Supreme Court under Part III if it is in respect of a
general valuation or supplementary valuation that was returned
before the commencement of Part 9 of the State Taxation Acts
Amendment Act 2017.
Division 2--Consequential amendments to other Acts
Clause 137 amends the Co-operative Housing Societies Act 1958.
Subclause (1) inserts a definition of valuer in the Co-operative
Housing Societies Act 1958. The term "valuer" is defined to
mean a person who holds the qualifications or experience
specified under section 13DA(2) of the Valuation of Land Act
1960.
Subclause (2) repeals the definition of valuator as it no longer
applies.
Subclause (3) inserts a new heading "Valuations of property to
be made by valuers" to section 58.
Subclause (4)(a), (d) and (e) substitutes "valuator" with "valuer"
in subsections (2), (5) and (6) to align with terminology used in
the Valuation of Land Act 1960.
Subclause (4)(b) substitutes "valuator's" with "valuer's" in
subsection (3) for consistency of wording in section 58.
Subclause (4)(c) substitutes "valuators" with "valuer's" in
subsection (4) for consistency of wording in section 58.
Clause 138 amends the definition of general valuation in section 3(1) of the
Land Tax Act 2005 by removing the words "made under section
11(a), 12, 13H(a) or 13I of that Act".
50
Clause 139 repeals section 21A of the Land Tax Act 2005. A general
valuation is conducted annually and the site value valuation will
be used for assessing land tax for each tax year. This section is
no longer required to prevent a retrospective application to the
previous tax year assessment of a site value that has been reduced
by a successful objection to the current tax year assessment.
Clause 140 amends the Local Government Act 1989.
Subclause (1) inserts a new provision in section 157 of the Local
Government Act 1989 to make it a requirement for councils to
use the valuations as returned by the valuation authority for the
purpose of calculating the site value, net annual value and capital
improved value of rateable land.
Clause 141 amends the Water Act 1989.
Subclause (1) substitutes "municipal valuation" with "general
valuation" in section 262(1)(a) to align with the terminology used
in the Valuation of Land Act 1960.
Subclause (2) inserts a new definition of general valuation in
section 262(4) which has the same meaning as in the Valuation
of Land Act 1960.
Part 10--Repeal of amending Act
Clause 142 repeals this Act as of 1 July 2019, but does not affect the
continuing operation of the amendments made by it.
51