Commonwealth Numbered Regulations - Explanatory Statements

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MILITARY SUPERANNUATION AND BENEFITS AMENDMENT REGULATIONS 2000 (NO. 1) 2000 NO. 144

STATUTORY RULES 2000 NO. 144

Issued by the Authority of the Parliamentary Secretary to the Minister for Defence

Military Superannuation and Benefits Act 1991

Military Superannuation and Benefits Amendment Regulations 2000 (No. 1)

Section 52 of the Military Superannuation and Benefits Act 1991 (the Act) provides that the Governor-General may make regulations in relation to the Military Superannuation and Benefits Scheme. However, subsection 52(2) specifies that regulations may not be made unless the Board consents to them (paragraph 52(2)(b)) or they relate to employer contributions (paragraph 52(2)(b)).

The Military Superannuation and Benefits Act 1991 (the Act) sets up the Military Superannuation and Benefits Scheme. The Act sets up two entities, the Military Superannuation and Benefits Board and the Military Superannuation and Benefits Fund. Under Goods and Services Tax (GST) laws, superannuation funds and trustee boards are to be considered as separate entities.

The Military Superannuation and Benefits Board and Fund would not be subject to the GST because of subsection 24(1) of the Act. This subsection provides that the Board and Fund are not liable to taxation under a law of the Commonwealth (aside from some specified exceptions). However, the Act allows for regulations to be made to ensure that the Board and Fund may be subject to taxation under a specified law (subsection 24(3) refers). Thus, this section could be utilised to make the Board and Fund subject to the GST.

Section 177-5 of the A New Tax System (Goods and Services Tax) Act 1999 has scope to override the exempt status of the Boards but not the Funds. However, these regulations have been made to ensure that- the Military Superannuation Benefits Fund is subject to the GST and to put its application to the Board beyond doubt.

The application of the GST to the Military Superannuation and Benefits Fund and Board will be consistent with the Government's intention that the GST applies to all Commonwealth entities, superannuation funds and trustee boards.

The Regulations ensure that subsection 24(1) does not exempt the Military Superannuation Benefits Board and the Fund from GST laws. The relevant GST laws specified in the Statutory Rule are:

*       New Tax System (Goods and Services Tax) Act 1999

*       A New Tax System (Goods and Services Tax Transition) Act 1999

*       New Tax System (Goods and Services Tax) Regulations 1999

*       Part VI of the Taxation Administration Act 1953

The Military Superannuation and Benefits Board has consented to the making of these Regulations.

The Regulations commence on 1 July 2000.