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2019-2020
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
RADIOCOMMUNICATIONS (RECEIVER LICENCE TAX) AMENDMENT BILL
2020
EXPLANATORY MEMORANDUM
(Circulated by authority of the Minister for Communications, Cyber Safety and the Arts
the Honourable Paul Fletcher MP)
RADIOCOMMUNICATIONS (RECEIVER LICENCE TAX) AMENDMENT
BILL 2020
OUTLINE
Amendments proposed in the associated Bill, the Radiocommunications Legislation
Amendment (Reform and Modernisation) Bill 2020, aim to increase investment certainty
through providing longer maximum licence terms for licences issued under the
Radiocommunications Act 1992 (the Radiocommunications Act), introducing a maximum
licence term of 20 years for apparatus licences and spectrum licences. Currently, a spectrum
licence issued under the Radiocommunications Act has a maximum term of 15 years and an
apparatus licence (transmitter or receiver licence) generally has a maximum term of 5 years.
Currently, the timeframes in which licensees pay for the value of the spectrum that they are
licensed to use varies between spectrum licences and apparatus licences. Spectrum licences
are subject to a spectrum access charge under the Radiocommunications Act. This spectrum
access charge must be paid at a time determined by the Australian Communications and
Media Authority (ACMA). For receiver licences, payments of tax are made under the
provisions of the Radiocommunications (Receiver Licence Tax) Act 1983 (the Act). Where a
receiver licence has a term greater than 12 months, the licensee is able to choose whether to
pay the applicable tax on the issue of the licence, or in annual instalments over the term of the
licence.
With the alignment of the maximum duration of spectrum licences and receiver licences,
different timing for the applicable charges and taxes has the potential to introduce
inefficiencies in the spectrum management framework by distorting demand between licence
types.
This Bill amends the Act to enable ACMA to determine whether, for a specified class of
licences with longer than 12 months duration, the tax imposed by the Act is imposed on the
issue of the licence for the full period the licence is in force, or whether it should be paid in
annual instalments. If a licence does not belong to a specified class determined by ACMA,
the current arrangements will continue to apply.
FINANCIAL IMPACT STATEMENT
It is anticipated that the Bill will have no financial impact.
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STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Radiocommunications (Receiver Licence Tax) Amendment Bill 2020
This Bill is compatible with the human rights and freedoms recognised or declared in the
international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny)
Act 2011.
Overview of the Bill
This Bill amends the Radiocommunications (Receiver Licence Tax) Act 1983 to enable the
Australian Communications and Media Authority (ACMA) to determine specified classes of
receiver licences where the licence holder will be required to pay the applicable licence tax
on the issue of the licence or by annual instalments, rather than the licensee having this
election.
This amendment is consequential to the amendments in the Radiocommunications
Legislation Amendment (Reform and Modernisation) Bill 2020, which increase the
maximum duration of receiver licences from 5 years to 20 years. By introducing the
possibility of long-term, high-value receiver licences, the amendments in this Bill are
necessary to avoid distorting demand between receiver licences and spectrum licences under
the Radiocommunications Act 1992, which would introduce inefficiencies into the spectrum
management framework.
Human rights implications
This Bill does not engage any of the applicable rights or freedoms. The human rights
implications of the reforms as a whole are discussed as part of the Statement of Compatibility
with Human Rights for the Radiocommunications Legislation Amendment (Reform and
Modernisation) Bill 2020.
Conclusion
This Bill is compatible with human rights as it does not raise any human rights issues.
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NOTES ON CLAUSES
Clause 1 - Short Title
This clause advises that the short title of the Act will be the Radiocommunications (Receiver
Licence Tax) Amendment Act 2020.
Clause 2 - Commencement
This clause provides that the Act will commence on a single day to be fixed by proclamation
by the Governor-General in Council. However, the Act will commence the day following the
expiry of a 6 month period from the day the Act receives the Royal Assent if the Act has not
commenced before that day.
Clause 3 - Schedules
This clause provides that the Schedules amend or repeal provisions of the legislation referred
to in the Schedule, as set out in the items of that Schedule.
SCHEDULE 1 - AMENDMENTS
PART 1 - AMENDMENTS
Radiocommunications (Receiver Licence Tax) Act 1983
Item 1 - After subsection 6(1)
This item inserts new subsections 6(1A), 6(1B), 6(1C), and 6(1D) into the Act. These
provisions enable the Australian Communications and Media Authority (ACMA) to
determine whether the licensee of a receiver licence of more than 12 months duration, where
an application is made, pays the applicable tax on the issue of the licence or in annual
instalments.
Subsection 6(1A) provides that for a receiver licence with a licence period greater than 12
months that is covered by a determination made by ACMA under subsection 6(1B), tax will
be imposed on the licensee on the issue of the licence for the full licence period.
Subsection 6(1B) provides ACMA with the power to determine classes of receiver licence for
the purposes of subsection 6(1A). These determinations will enable ACMA to specify matters
such as particular uses of the spectrum and particular durations of licences where the licensee
will be required to pay tax upfront. These determinations will be made by legislative
instrument, and thus subject to requirements such as the consultation, disallowance and
sunsetting provisions of the Legislation Act 2003.
Subsection 6(1C) provides that for a receiver licence with a licence period greater than 12
months that is covered by a determination made by ACMA under subsection 6(1D), tax will
be imposed in instalments, occurring on the issue of the licence and on each anniversary of
the licence coming into force.
Subsection 6(1D) provides ACMA with the power to determine classes of receiver licence for
the purposes of subsection 6(1C). These determinations will enable ACMA to specify matters
such as particular uses of the spectrum and particular durations of licences where the licensee
will be required to pay tax by instalment. These determinations will also be made by
legislative instrument.
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In each instance, the amount of tax payable will be calculable using the determinations made
by ACMA under section 7 of the Radiocommunications (Receiver Licence Tax) Act 1983 (the
Act).
Item 2 - Subsection 6(4)
Subsection 6(4) currently provides that a licensee must choose to either pay upfront or to pay
by annual instalments. This item repeals and substitutes this subsection, so that it provides
that this election must be made only in circumstances where the licence is not covered by a
determination under subsection 6(1B) or 6(1D), as these determinations would determine
whether payments are to be made upfront or by annual instalment.
PART 2 - APPLICATION PROVISION
Item 3 - Application - section 6 of the Radiocommunications (Receiver Licence Tax) Act
1983
This item provides that the amendments made by items 1 and 2 above only apply to receiver
licences where the application for the receiver licence is made after the commencement of
this item. This means that ACMA will be unable to alter the payment arrangements for
existing receiver licences and that determinations made under subsection 6(1B) and 6(1D)
will only apply to licences issued after the commencement of this item (including the renewal
of a licence).
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