Commonwealth Consolidated Acts

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

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

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

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

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

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

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

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

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