Issued by authority of the Minister for Revenue
and Assistant Treasurer

Commonwealth Places (Mirror Taxes) Act 1998

Commonwealth Places (Mirror Taxes) Amendment Regulations 2005 (No. 1)

Subsection 25(1) of the Commonwealth Places (Mirror Taxes) Act 1998 (the MTA) provides that the Governor-General may make regulations prescribing matters required or permitted by the MTA to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to the MTA.

The Regulations update references to State tax legislation so that the relevant State tax laws can operate in respect of Commonwealth places. 

The MTA provides a framework for the imposition of taxes, which mirror certain State taxes, on businesses operating in Commonwealth places in the States.  Examples of Commonwealth places are Commonwealth airports and post offices.  The revenue is collected by the States on behalf of the Commonwealth and appropriated back to the States.  The MTA was enacted in response to the High Court decision in Allders International Pty Ltd v Commissioner of State Revenue (Victoria) (1996) 186 CLR 630, in which the High Court held that the imposition of stamp duty on a lease covering part of a Commonwealth place was invalid because the Commonwealth has the exclusive power to make laws with respect to Commonwealth places (paragraph 52(i) of the Constitution).  The decision meant that other State taxes may similarly be invalid in relation to Commonwealth places.

The relevant State taxes are listed in Schedule 1 of the MTA and can also be prescribed by the Commonwealth Places (Mirror Taxes) Regulations 2000 (the principal Regulations). 

The State tax laws, which the MTA and the principal Regulations apply, remain the same in substance but the references to the State legislation have been updated to reflect newer versions or the repeal of State tax legislation. 

The Regulations would ensure the continued operation of the existing scheme and, therefore, should not increase compliance costs for taxpayers or administration costs for the States.  The new versions of the Western Australian tax legislation which are prescribed are the Debits Tax Act 2002, Debits Tax Assessment Act 2002, Pay-roll Tax Act 2002, Pay-roll Tax Assessment Act 2002, Land Tax Act 2002, Land Tax Assessment Act 2002 and Taxation Administration Act 2003 (schedule 2).  The Tasmanian Debits Duties Act 2001(schedule 3) and Land and Income Taxation Act 1910 (schedule 1) have now been repealed and therefore, will not be listed in the Regulations.    

To increase the readability of the Regulations, the Regulations amend the listing to a table format. 

Taxpayers, operating in Commonwealth places in the relevant States, have not been consulted on the changes as the Regulations do not substantially alter existing arrangements.  In such circumstances, paragraph 18(2)(a) of the Legislative Instruments Act 2003 provides an exception to the need for consultation with affected persons in the making of regulations. 

Consultation has been undertaken with the relevant State Revenue Offices and State Treasuries in listing or repealing the State tax legislation.

The Act specifies no conditions that need to be satisfied before the power to make the Regulations may be exercised.

The Regulations are a legislative instrument for the purposes of the Legislative Instruments Act 2003.

The Regulations commence, or are taken to have commenced, as follows:

(a)    Regulations 1, 2, and 3 and Schedule 1 -- on 1 January 2001;

(b)   Schedule 2 -- on 1 July 2003; and

(c)    Schedule 3 -- on 1 July 2005.

The formatting change, as contained in Schedule 4, commences the day after the Regulations are registered. 

The Regulations are retrospective, reflecting the dates on which the relevant State legislation was enacted or repealed.  This ensures that the current version of the State legislation is applied under the MTA.  Subsection 25(2) of the MTA provides an exemption to the prohibition on retrospective regulations in subsection 48(2) of the Acts Interpretation Act 1901.  The ability to make retrospective regulations has been preserved by subsection 4(3) of the Legislative Instruments (Transitional Provisions and Consequential Amendments) Act 2003, notwithstanding the repeal of subsection 48(2) of the Acts Interpretation Act 1901.