Legislative Assembly for the ACT: 2008 Week 08 Hansard (Thursday, 7 August 2008) . . Page.. 3091 ..
This change is designed to ensure that one is not able to reduce duty payments by acquiring land in a piecemeal fashion using options contracts. This also seems to me to be a reasonable change.
There are other changes in this bill which seek to tighten up existing anti-avoidance measures. I will not go into these in detail since the Treasurer has already spoken about them and discussed them in his explanatory statement for the bill. None of these changes raise any huge red flags in my mind, although, as I will discuss in a moment, I always have some reservations over changes of this kind that have the effect of expanding the scope of taxation in the ACT.
I note from the explanatory statement for this bill that the proposed change aligns the ACT position more closely with other jurisdictions, particularly New South Wales and Victoria. Whilst uniformity between jurisdictions is valuable, I do not think that we should be tightening the noose of our tax laws just for the sake of more closely aligning ourselves with other jurisdictions. I do not know whether it is because of my early career in the Australian Taxation Office but I have always been comfortable with anti-avoidance measures which seek to ensure that transfers of property are treated according to their overall substance rather than the particular contractual form and mechanisms used for the exchange.
However, I also have some reservations about the changes in this bill that I would like to speak to. I often hear the Treasurer speak about how taxes in the ACT are roughly aligned with those in other jurisdictions. Whilst I have some issues with the Treasurer’s methodology in making this statement, it is certainly no great achievement to mimic other jurisdictions which are also heavily taxing their citizens.
In the ACT, the level of overall taxes, fees and fines has increased by more than 66 per cent since the Stanhope government came to power. In light of this massive increase, I do not think that we should look lightly at attempts to lower the threshold for duties payments or to aggregate separate purchases of land. We must be sure that the schemes in question are indeed analogous to more direct transfers of land and are indeed designed, in substance, to be a genuine transfer of land. This will ensure that anti-avoidance measures of this kind do not simply become another grab for revenue.
Despite some reservations, I will be supporting this bill. I believe that, overall, the changes appear reasonable within the context of current corporate practice. The changes seem to me to target instances where the substance of the transaction is a transfer of land which, if done directly, would be subject to duty. I do think that we need to be careful to watch this area with interest in order to ensure that problems do not arise with these provisions. In particular, we need to ensure that people are not unfairly targeted by duty provisions and transactions that should not be subject to such provisions. I will be supporting this bill.
DR FOSKEY (Molonglo) (5.46): I will be brief and I will be supporting this bill. It tightens up provisions relating to the transfer of land ownership by trusts. It has been very comprehensively described by Mr Mulcahy, by the Treasurer in his presentation speech and also by Mr Smyth. It includes careful transitional arrangements to provide for some degree of flexibility in order to avoid unintended consequences. I do not know whom the government consulted on this matter, but we were advised in the