On Wednesday 11 October, the Queensland Government
introduced the Revenue and Other Legislation Amendment Bill
2006 (Bill) into parliament. Among other proposals, the Bill
provides for the amendment of the Duties Act 2001
eliminates hire of goods duty and marketable security
duty and make consequential amendments, and
amends the mortgage duty provisions relating to security
over assets in more than one jurisdiction.
These changes relate to announcements that were made as part
of the Inter-Governmental Agreement (agreement). Under that
agreement, the states and territories agreed to eliminate
certain stamp duties in return for receiving the GST revenue
collected by the federal government.
Elimination of Hire of Goods Duty and Marketable
Queensland removed credit business duty and lease duty from
1 January 2006.
The Bill now gives effect to the abolition of hire duty and
marketable security duty, with effect from 1 January 2007.
Marketable security duty applies to transactions involving
shares in unlisted companies or units in public unit trusts.
This abolition does not affect the land-rich provisions or the
duty imposed in relation to private unit trusts.
A number of important consequential changes are included in
the Bill, affecting:
the land-rich provisions
corporate trustee duty, and
corporate reconstruction relief.
Queensland has also agreed to halve the duty payable on
transfers of non-realty business assets from 1 January 2010 and
eliminate it on 1 January 2012. This is still to be
Mortgage Duty Changes
As part of the stamp duties reduction process, Queensland
will halve its mortgage duty rate on 1 July 2008 and abolish
mortgage duty on 1 July 2009. For the other states:
New South Wales has agreed to halve mortgage duty from 1
January 2010 and abolish it from 1 January 2011
Western Australia halved its mortgage duty rate on 1 July
2006 and will abolish mortgage duty on 1 July 2008
South Australia will reduce the rate of mortgage duty by
a third on each of 1 July 2007 and 1 July 2008 and will
abolish the duty on 1 July 2009, and
Tasmania halved its rate of mortgage duty on 1 July 2006
and will abolish mortgage duty on 1 July 2007.
Currently each state has special provisions for calculating
the duty payable on mortgages or mortgage packages that secure
property in more than one jurisdiction. In each state, mortgage
duty is only payable on a proportion of the secured
The proportion is calculated by reference to the value of
secured property in the state. In New South Wales and South
Australia this is compared to the total value of secured
property situated anywhere in the world. The Tasmanian
calculation excludes property located in a territory or outside
Australia. Currently, Queensland and Western Australia exclude
property in Victoria, a territory or outside Australia, on the
basis that those jurisdictions do not impose mortgage duty.
The amendments in the Bill will also exclude Tasmanian
property from the calculation on or after 1 July 2007—the
date on which Tasmania abolishes mortgage duty. The effect of
this change is that Queensland takes some of the benefit from
the abolition of Tasmanian mortgage duty. This will prejudice
businesses that have assets located in both Queensland and
It is not known whether Western Australia proposes similar
changes, although their earlier schedule for abolition might
suggest they will not.
Other Mortgage Duty Changes
The Bill also introduces a number of anti-avoidance
provisions that relate to the abolition of mortgage duty in
Tasmania. These anti-avoidance provisions mirror provisions
introduced to deal with Victoria's abolition of mortgage
duty in 2004. One provision denies an exemption where the
commissioner considers that the proportion of Tasmanian
property secured by a collateral mortgage has been structured
to avoid Queensland mortgage duty. Another provision requires a
re-assessment of additional Queensland mortgage duty if any
Tasmanian duty on a mortgage is refunded.
These provisions apply from the abolition of Tasmanian
mortgage duty on 1 July 2007.
The constantly changing stamp duty landscape over the next
few years makes the right stamp duty advice critical. Freehills
has the largest team of dedicated stamp duty specialists in the
country, with extensive experience in all states and
The content of this article is intended to provide a
general guide to the subject matter. Specialist advice should
be sought about your specific circumstances.
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Exemptions or concessions on stamp duty could apply when contemplating the purchase or transfer of NSW real estate.
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