We know that state government revenues must be falling when the
government is looking for new ways to increase its revenue base.
While the introduction of the GST was a bonanza for the Victorian
Government, it is clearly concerned about falling revenues given
the contents of the Duties Amendment Bill 2008.
When the GST was introduced a number of state taxes and duties
were abolished, including stamp duty on leases which ended in
Victoria some years ago. However, it now appears the government is
concerned that some property vendors and purchasers are avoiding
conveyancing duty by entering into long term leases with up front
payments, akin to a freehold value.
While this is a legitimate means of avoiding stamp duty, the
government now seeks to close the loophole and charge conveyancing
rate duty on leases where a premium or an amount is paid, other
It would now appear that if a long-term lease is granted and an
upfront payment is made, this would be caught by the new regime
once it becomes law and conveyancing rate duty will be charged.
These changes took effect from 21 November 2008, therefore new
leases entered into since this date which provide an upfront lump
sum payment are likely to be caught.
Perhaps more controversially, the Duties Amendment Bill 2008 now
requires that all stamp duty in Victoria be paid within 14 days,
rather than 3 months. This is impractical and at odds with the rest
of Australia which has a longer time to pay stamp duty. We
understand that various bodies are lobbying the Victorian
Government on this issue and we would expect that the 14 day period
will be extended.
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.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
Exemptions or concessions on stamp duty could apply when contemplating the purchase or transfer of NSW real estate.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).