This Digest was prepared for debate. It reflects the legislation as
introduced and does not canvass subsequent amendments. This Digest
does not have any official legal status. Other sources should be
consulted to determine the subsequent official status of the
Sales Tax Assessment Amendment Bill 1997
Date Introduced: 28 August 1997
House: House of Representatives
Commencement: With effect from 6 August 1997
The Bill makes consequential amendments to the Sales Tax
Assessment Act 1992 resulting from the Government's decision
to increase rates of sales tax on alcoholic beverages.
The present Bill forms part of a package of nine proposed laws.
This package collectively constitutes the Commonwealth's
legislative response to a unanimous request from the State and
Territory Governments to protect their revenues following the High
Court's decisions in Ha & Another v State of New South
Wales & Others and Walter Hammond & Associates Pty
Limited v State of New South Wales and Others.
A detailed 'background' is provided in the Bills Digest for the
Franchise Fees Windfall Tax (Collection) Bill 1997.
The proposed changes will operate to protect the interests of
some small businesses.
An unintended consequence of the Government's package designed
to safeguard State and Territory revenues is that raising sales tax
rates will push some businesses with relatively small turnovers
over current compliance thresholds under the Sales Tax
Assessment Act 1992. Had States and Territory taxes been able
to continue collecting their (notional) portion of alcohol taxes
separately from the Commonwealth, this problem would not have
As noted in the Explanatory Memorandum, section 29 of
the Sales Tax Assessment Act 1992 exempts firms from sales
tax where their annual liability is $10 000 or less.
Item 1 of Schedule 1 seeks to maintain the real
value of the current exemption from sales tax of businesses such as
small wineries. The mechanism for achieving this end (ie
maintaining the status quo) is to exclude sales tax raised as part
of the Commonwealth's post Ha and Hammond safety
net proposals from the calculation of sales tax liability for the
purposes of the small business exemption.
Item 4 of Schedule 1 seeks to maintain existing
arrangements in relation to the quarterly payment of sales tax.
Under section 62 of the Sales Tax Assessment Act 1992,
businesses with an annual sales tax liability of less than $ 57 571
presently need not remit sales tax to the Australian Taxation
Office on a monthly basis, but may do so quarterly.The amendment
will exclude the Commonwealth's post Ha and
Hammond 15% tax increase on alcoholic drinks from
calculations for the purposes of the section 62 threshold.
2 September 1997
Bills Digest Service
Information and Research Services
This Digest does not have any official legal status. Other
sources should be consulted to determine whether the Bill has been
enacted and, if so, whether the subsequent Act reflects further
IRS staff are available to discuss the paper's contents
with Senators and Members and their staff but not with members of
© Commonwealth of Australia 1997
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Published by the Department of the Parliamentary Library,
This page was prepared by the Parliamentary Library,
Commonwealth of Australia
Last updated: 3 September 1997
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