Bills Digest No. 87  1999-2000 A New Tax System (Indirect Tax and Consequential Amendments) Bill (No. 2) 1999


Numerical Index | Alphabetical Index

WARNING:
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 Bill.

CONTENTS

Passage History
Purpose
Background
Main Provisions
Endnotes
Contact Officer and Copyright Details

Passage History

A New Tax System (Indirect Tax and Consequential Amendments) Bill (No. 2) 1999

Date Introduced: 21 October 1999

House: House of Representatives

Portfolio: Treasury

Commencement: Royal Assent, except for items in the Schedules which commence on 1 July 2000.

Purpose

The purpose of this Bill is to make consequential amendments to the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) and related indirect tax legislation that originated from a consultation process that commenced following the passage of the GST Act. The Bill makes minor policy and technical amendments to the following legislation:

  • The GST Act, A New Tax System (Luxury Car Tax) Act 1999 (LCT Act), and A New Tax System (Wine Equalisation Tax) Act 1999 (WET Act) in respect of a number of areas including GST-free supplies, payments made to local government bodies and second-hand goods
  • The GST Act and the A New Tax System (Goods and Services Tax Transition) Act 1999 (GST Transition Act) in relation to the treatment of insurance
  • The GST Transition Act in relation to certain rights granted for life, certain long term leases entered into between 2 December 1998 and 1 July 2000 and provides a special credit for certain alcoholic beverages and certain petroleum products
  • The A New Tax System (Commonwealth-State Financial Arrangements) Act 1999 (CSFA Act) regarding the calculation of GST revenue to be distributed to the States and Territories
  • The A New Tax System (Australian Business Number) Act 1999 (ABN Act) to ensure that overseas businesses that are required to register for GST purposes are able to obtain an ABN
  • The Consular Privileges and Immunities Act 1972 (CP&I Act), the Diplomatic Privileges and Immunities Act 1967 (DP&I Act), the International Organisations (Privileges and Immunities) Act 1963 (IO(P&I) Act), and the Overseas Missions (Privileges and Immunities) Act 1995 (OM(P&I) Act) to provide for a number of indirect taxation concessions for diplomatic missions, consular posts, overseas missions, international organisations and their officials, and international organisations in Australia, and
  • The Petroleum Resource Rent Tax Assessment Act 1987 (PRRTA Act) to exclude GST from the tax base for calculating the petroleum resource rent tax (PRRT).

Background

This section provides a summary of the events leading up to the introduction of the GST, a brief explanation of the operation of the GST and the rationale for this Bill.

Recent History

On 13 August 1998 the Federal Government released proposals for reform of the Australian tax system(1) (ANTS) of which, a goods and services tax (GST) was the centrepiece.

The tax reform plan proposed to:

  • Introduce a GST which eliminates sales tax and a range of nine other indirect taxes
  • Change Commonwealth-State financial relations by providing States and Territories with an independent revenue base
  • Implement significant changes to individual marginal tax rates
  • Implement a major rationalisation of family assistance
  • Replace the various existing taxation payment and reporting systems of company tax, provisional tax, PAYE,(2) PPS(3) and RPS(4) by one quarterly tax payment system, PAYG.(5)
  • Introduce a new universal business number system
  • Move toward an entity taxation system which is directed toward the elimination of tax advantages between different business structures, and
  • Simplify the imputation system and introduce refunds for excess franking credits.

On 25 November 1998, the Senate referred issues relating to the GST and the new tax system to a Select Committee and three of its Reference Committees.(6) In February 1999 the Senate Select Committee produced its First Report.(7) The three Reference Committees produced their reports in March 1999.(8) In April 1999 the Senate Select Committee released its second report(9) and shortly thereafter, its report on Commonwealth-State financial arrangements, luxury car tax and wine equalisation tax.(10)

The Government did not, however, possess sufficient numbers in the Senate to pass its tax reform plan without the support of either the Independents or the Australian Democrats. On 14 May 1999 independent Senator Brian Harradine announced that he would not support the GST. The Government elected to negotiate with the Australian Democrats to secure its passage through the Senate.

On 28 May 1999 the Prime Minister announced that an agreement had been concluded between the Government and the Australian Democrats on the GST and ANTS. The agreement retained the GST rate at 10 per cent to apply from 1 July 2000, but included changes to the GST, the State taxation and funding arrangements, compensation, the planned income tax cuts and introduced new environmental measures.

The ANTS legislation as amended, some 39 Bills, was passed by both Houses on or before 30 June 1999 and received Royal Assent on 8 July 1999 except for the Bills relating to the Commonwealth-State financial arrangements, which received Royal Assent on 10 September 1999.

GST Overview

The GST is a broad-based indirect tax on final private consumption in Australia. It taxes the consumption of most goods, services and any other things, including things imported into Australia, but not consumption outside Australia. The GST rate is 10 per cent, and commences on 1 July 2000.

The GST is based on the Value Added Tax (VAT) system, which has been adopted by nearly all OECD countries and more than 80 others around the world. The GST concept of taxing final private consumption is achieved by:

  • imposing tax on supplies made by entities registered for GST purposes, and
  • allowing those entities to claim a full credit for any GST they have paid on business purchases (or inputs). Such credits will be known as input tax credits.

Consistent with other GST and VAT regimes, there will be two types of non-taxable supplies, 'GST-free' and 'input taxed', known in most other countries with a GST or VAT as 'zero rated' and 'exempt' respectively.

GST-free supplies will not be taxed and input tax credits will be allowed on things acquired to make the supply. The main activities that will be GST-free include exports, certain expenditure by tourists, health and medical care, education, childcare, charitable activities and religious services.

Input taxed supplies will similarly not be taxed, however no input tax credits will be allowed on things acquired to make the supply. The main activities that will be input taxed are financial services and residential rents.

With any new legislative regime, such as the GST, it is reasonable to expect that there will be a period of 'bedding down' the legislation, and for minor amendments to be made to remove legislative anomalies and oversights. This has been noted in the press:

It will take more than 10,000 amendments to optimise the legislation. But this is nothing to be embarrassed about. The legislation is deficient in a lot of respects, but only after business applies GST will many of the abnormalities start to pop up. ...We are already experiencing a lot of difficulty about how the tax will apply in different circumstances. There are many faults in the GST legislation; it would be amazing if we got it right the first time.(11)

This Bill goes part of the way to removing some of the 'abnormalities', oversights and unintended consequences of the GST legislation.

Main Provisions

Schedule 1-Indirect Tax Acts

Items 1 to 15 amend the GST Act to ensure that payments made to local governments that are specifically covered by an appropriation are not subject to GST.

Item 16 amends the GST Act to ensure that the precious metals provisions contained in the GST Act better reflect the way precious metal industry operates.

Items 17 and 18 amends the method of determining what is a financial supply by removing that method from the GST Act and providing for that method to be provided for in regulations.

Division 48 of the GST Act provides special rules that enable certain companies and non-profit associations to form a GST group. A GST group is effectively treated as a single entity and as such supplies and acquisitions made wholly within a GST group are taken out of the GST system. When a member of a GST group ceases to be a member of the GST group, it was intended that the exiting member would become responsible for accounting for all of its own adjustments, including those relating to transactions made to entities outside the group during the time it was a member of the group. The GST Act, as currently drafted, does not enable this to occur. Item 20 proposes that the GST Act provide for this situation.

The GST Act provides for the claiming of input tax credits for acquiring second hand goods. Item 23 provides that input tax credits for acquisitions of second-hand goods from unregistered suppliers can only be claimed where those goods are acquired as trading stock (excluding materials used in manufacture). Items 25 and 26 eliminate the administrative burden of tracing supplies of small items of trading stock back to the acquisition of those items by ensuring that for acquisitions of $300 or less, the amount of input tax credit is not linked to the subsequent supply. Item 27 proposes that a second-hand goods trader can elect to claim some input credits later than otherwise entitled if it is convenient for them to do so.

Item 30 provides a global accounting method for acquisitions of second-hand goods that are divided for re-supply. The global method is likely to be used when more than one supply can be made from the one acquisition (for example, a motor vehicle purchased by a wrecker for dismantling). In these cases, a matching of the credit on the acquisition with the GST on the subsequent supplies was considered by the Government to be impractical, thereby justifying this amendment.

Insurance

Schedule 2 makes numerous amendments to the GST Act regarding the application of GST to insurance contracts, schemes, claims excesses and subrogation.(12)

Item 31 intends to ensures that when calculating GST, the value of State stamp duties on insurance premiums are not included in the calculation.

Item 35 provides that a supply that an insurer makes in settling a claim is not a taxable supply. This ensures that when as a consequence of paying a claim, an insurer engages a builder directly to supply building services to the insurer to rebuild the insured person's property, the services would not attract GST.

Item 36 intends to have the effect that if an insurer has made a claim in exercising its rights of subrogation and a third party makes a payment, a supply or both in settlement of that insurance claim, it is consideration for a supply made by the insurer.

Insured entities can have a GST liability on an insurance settlement that is proportional to the input tax credit they were entitled to on the premiums paid for the relevant policy. For example, if an insured entity acquired a policy 60 per cent for a creditable purpose and 40 per cent for a private purpose, it would be entitled to an input tax credit equal to 60 per cent of 1/11 of the price of the policy. If an insured entity has a settlement under that policy it is liable for 1/11 of the GST inclusive value of the settlement, where it should only be liable to GST of 60 per cent of 1/11 of the GST inclusive value of the settlement.

Item 37 intends to ensure that the insured's GST liability on a settlement is proportional to the input tax credit it was entitled to on the premium.

Item 39 intends to ensure that where an insurance excess is paid only to the insurer (and not, for example, used by the insurer to pay for the repair of the insured's damaged property), the excess is not subject to GST.

Item 41 intends to provide that if an insurer has made a claim in exercising its rights of subrogation and a third party makes a payment, a supply or both in settlement of that claim, it is consideration for an acquisition made by the third party. It is consideration for a creditable acquisition if:

  • the third party is registered or required to be registered
  • has made the settlement for a creditable purpose, and
  • the settlement was consideration for a taxable supply made by the insurer.

The GST Act enables tax invoices to be issued by an agent of an entity that makes a taxable supply (eg an insurance agent). As insurance brokers are generally not acting as agents of the insurer when they arrange an insurance policy, they are not able to issue tax invoices in relation to the supply of that policy. This has the result that whilst the broker generally issues all other documents to the insured in relation to that policy, they cannot issue the tax invoice. Item 50 amends the GST Act to permit insurance brokers to issue tax invoices on behalf of the insurer.

Item 42 deals with statutory compensation schemes. Some statutory compensation schemes do not fall within the existing definition of insurance in the GST Act, while other statutory compensation schemes are insurance and are covered. For example, some workers' compensation schemes are within the definition of insurance and others are not. The Government argues that the intention is to treat such statutory compensation schemes similarly. Item 42 also ensures that GST is calculated on the stamp duty exclusive value of the premium of a statutory scheme. This is achieved by excluding the amount of any stamp duty payable under a State law or Territory law in respect of the premium. This amendment is similar to the amendment being made by item 31. Item 42 also ensures that if there is a judgment or order of the court in relation to an insurance claim the outcome for GST purposes is the same as if the settlement had been made without the intervention of the court.

Under workers' compensation and CTP(13) schemes it is common for beneficiaries to receive regular payments under the scheme. The GST Act could raise a GST liability every time a payment is made (eg fortnightly) to the injured employee. Proposed amendments should allow the insurer a decreasing adjustment to, in effect, decrease the entitlement on settlement by the amount of GST liability.

The Bill also makes amendments to ensure that telecommunications services that are used or enjoyed in Australia are subject to GST regardless of whether the supplier is in Australia or offshore. Item 43 provides an additional criterion for 'connected with Australia' specifically for telecommunication supplies. That is, if the effective use or enjoyment of a telecommunication supply is in Australia, the supply will be 'connected with Australia'. This item also provides a new definition of 'telecommunications supply' designed to capture the means of communication but not the content.

The definition of 'entity' in the GST Act and the ABN Act are different. Under the GST legislation, all government organisations would effectively be part of a single State, Territory and Commonwealth registration and each Government would decide which sub-entities it would treat as separate branches for GST purposes. The ABN Act includes a definition of 'government entity' which allows for separate registration of government entities at a lower level. Item 57 inserts a definition of 'government entity' into the GST Act to allow (but not require) for the separate registration of government entities. Under this definition, a government entity has the same meaning given by the ABN Act.

The GST Act contains the rules that apply to GST groups. Currently, the grouping provisions only apply to a company, a partnership or trust that satisfies the requirements specified in the regulations and certain non-profit bodies. Item 47 intends to allow government entities to form GST groups.

The A New Tax System (Indirect Tax and Consequential Amendments) Bill 1999 proposes new subsection 9-75(2) be inserted into the GST Act to ensure that luxury car tax (LCT) is not included when calculating the value of a taxable supply. Items 59 to 61 contain technical amendments to the GST Act, to deal with the flow-on effects of subsection 9-75(2) being inserted. This will bring the legislation into line with the Government's original intention and will ensure that the correct amount of LCT and GST is paid.

Commencement: The above provisions commence immediately after the commencement of Part 1 of Schedule 1 of the proposed A New Tax System (Indirect Tax and Consequential Amendments) Act 1999, which commences immediately after the commencement of the A New Tax System (Goods and Services Tax) Act 1999, that is, 1 July 2000.

Amendment of the A New Tax System (Luxury Car Tax) Act 1999

Item 78 amends the definition of 'car' to include a limousine, regardless of the number of passengers it is designed to carry.

Commencement: The above provision commences immediately after the commencement of Part 2 of Schedule 1 of the proposed A New Tax System (Indirect Tax and Consequential Amendments) Act 1999, which commences immediately after the commencement of the A New Tax System (Luxury Car Tax) Act 1999, that is, 1 July 2000.

Amendment of the A New Tax System (Wine Equalisation Tax) Act 1999

Item 79 amends the definition of 'application to own use' in the WET Act by adding a further exclusion. This amendment will allow, for example, a manufacturer that uses wine to produce other beverages to purchase the wine under quote, free of wine equalisation tax (WET).

Commencement: The above provision commences immediately after the commencement of Part 3 of Schedule 1 of the proposed A New Tax System (Indirect Tax and Consequential Amendments) Act 1999, which commences immediately after the commencement of the A New Tax System (Wine Equalisation Tax) Act 1999, that is, 1 July 2000.

Schedule 2-Indirect Tax Transition

This Schedule contains the amendments made to the GST Transition Act in relation to:

  • Long-term leases
  • Rights granted for life
  • Transitional credits for alcoholic beverages
  • Transitional credits for petroleum products, and
  • Second-hand goods.

Items 1 and 2 amend sections 11 and 12 of the GST Transition Act to make it clear that those sections do not apply to a supply of a long-term lease made before 1 July 2000. A long-term lease is defined in the GST Act to be a lease for at least 50 years.

Item 3 replaces subsection 14(2) of the GST Transition Act to ensure that it is only the extent to which a supply relates to the right granted for life that will be taken to be made after 1 July 2000 and subject to GST.

Items 5 and 6 allow a input credit to be claimed for alcoholic beverages. The proposed changes enable holders of unopened stocks of alcoholic beverages that are not covered by the WET to claim a special credit for the sales tax included in the price of the goods.

Commencement: The above provisions commence immediately after the commencement of Schedule 6 of the proposed A New Tax System (Indirect Tax and Consequential Amendments) Act 1999, which commences immediately after the commencement of the A New Tax System (Goods and Services Tax Transition) Act 1999.(14)

Schedule 3-Commonwealth-State Financial Arrangements

This Schedule contains proposed amendments to the CSFA Act designed to ensure that the calculation of GST revenue to be distributed to the States and Territories will include any general interest charge (GIC) relating to GST and will ensure that any effect the WET and LCT laws may have on GST revenue will not be included in the calculation.

The CSFA Act provides for GST revenue to be distributed to the States and Territories and prescribes how the Commissioner will determine GST revenue. The Commonwealth and the States have agreed that GST revenue will be distributed on a tax collected basis; that is, the States and Territories will bear the cost of non-payment of GST and receive the GIC collected by the Australian Taxation Office in respect of taxpayers defaulting on their GST liabilities - to the extent that it is attributable to GST. However, the CSFA Act, as currently drafted, does not include any GIC that is attributable to GST in the calculation of GST revenue. Further, due to the interaction of the GST Act with the WET Act and the LCT Act, the calculation of GST revenue as currently set out in the CSFA Act may include amounts that are referrable to WET and LCT. The distribution of GST revenue to the States and Territories should not include any amounts in respect of WET or LCT.

Item 4 intends to ensure that the GIC attributable to GST will be included in the calculation of GST revenue for distribution to the States and Territories. The GIC that is included in the calculation will be any GIC collected that is attributable to unpaid GST, or any GIC collected on unpaid GIC that is attributable to unpaid GST.

Item 1 inserts a definition of GIC.

Item 5 intends to ensure that refund amounts that are taken into consideration when calculating GST revenue include only those amounts that are attributable to GST. This is intended to ensure that GST revenue calculation is not reduced by refund amounts in respect of WET or LCT.

Commencement: The above provisions commence immediately after the commencement of the A New Tax System (Commonwealth-State Financial Arrangements), that is 1July 2000.

Schedule 4-Australian Business Numbers (ABNs)

This schedule contains amendments to the ABN Act to ensure that overseas businesses that are required to register for GST purposes are able to obtain an ABN.

Item 1 adds a new category of entity entitled to have an ABN, namely, where an entity makes supplies that are connected with Australia.

Item 2 repeals section 39 of the ABN Act. The application of this section would have prevented a non-resident without a permanent establishment in Australia from obtaining an ABN. This amendment removes this restriction.

Commencement: The above provisions commence immediately after the commencement of Part 1 of Schedule 1 of the proposed A New Tax System (Indirect Tax and Consequential Amendments) Act 1999, which commences immediately after the commencement of the A New Tax System (Goods and Services Tax) Act 1999, that is, 1 July 2000.

Schedule 5-Amendments relating to diplomatic, consular and related privileges and immunities

This Schedule contains amendments to the CP&I Act, DP&I, IO(P&I) Act and OM(P&I) Act to ensure that Australia continues to meet its international obligations to provide a range of taxation concessions to various bodies and personnel in Australia.

The taxation concessions relate to the GST, WET and LCT and are intended to be granted by way of an exemption for goods imported by eligible persons and, by way of a payment by the Commissioner through the 'indirect tax concession scheme', for goods purchased in Australia.

The amendments to diplomatic, consular and related privileges and immunities are required for goods imported by these bodies. Without an exemption these bodies would be liable to pay GST, WET and LCT (as appropriate) on the goods imported.

Items 1 to 7 insert definitions of 'acquisition', 'approved form', 'Commissioner', 'GST Act', 'indirect tax', 'Luxury Car Tax Act' and 'Wine Equalisation Tax Act' in the CP&I Act.

Item 8 amends the CP&I Act to ensure that importations covered by, among other things, paragraph 1 or paragraph 2 of Article 50,(15) or Article 62,(16) of the Vienna Convention on Consular Relations are not subject to GST, WET or LCT.

Item 9 sets out the indirect tax concession scheme, the detail of which will be provided by a determination of the Minister for Foreign Affairs that will cover the following:

  • The countries which will benefit from the concessions
  • The types of acquisitions that will be covered
  • The types of eligible use for acquisitions, and
  • The conditions, limitations, and the period and manner in relation to any amounts payable.

Items 10 to 16 amend the DP&I Act in the same manner as items 1 to 7 proposes to amend the CP&I Act. Item 17 amends the DP&I Act to ensure that importations covered by, among other things, paragraph 1 of Article 36,(17) or paragraph 1 or paragraph 2 of Article 37,(18) of the Vienna Convention on Diplomatic Relations are not subject to GST, WET or LCT.

Item 18 sets out the indirect tax concession scheme in a manner similar to that in item 9.

Items 19 to 26 amends the IO(P&I) Act in the same manner as items 1 to 7 amended the CP&I Act. Item 27 amends the IO(P&I) Act to ensure that importations covered by an immunity from taxation conferred by the regulations are not subject to GST, WET or LCT.

Item 27 also sets out the indirect tax concession scheme in a manner similar to that in item 9.

Item 28 provides that international organisations will not need to be registered for GST purposes.

Items 29 to 35 insert definitions into the OM(P&I) Act in the same manner as items 1 to 7 amended the CP&I Act. Item 36 amends the OM(P&I) Act to ensure that importations covered by an immunity from taxation conferred by the regulations are not subject to GST, WET or LCT.

Item 37 sets out the indirect tax concession scheme in a manner similar to that in item 9.

Commencement: The above provisions commence immediately after the commencement of the A New Tax System (Goods and Services Tax) Act 1999, that is, 1 July 2000.

Schedule 6-Petroleum Resource Rent Tax Assessment Act 1987

Schedule 6 contains amendments to the PRRTAA that are intended to ensure that GST is excluded from the tax base for calculating PRRT.

Participants in a petroleum project are liable for PRRT on taxable profits from the project. A taxable profit will result if assessable receipts for a financial year exceed deductible expenditure. From 1 July 2000, the receipts derived and expenditure incurred may include GST. The Government claims that these amendments are designed to ensure that GST components embedded in the receipts and expenditure will be excluded from the calculation of the taxable profit that is subject to PRRT.

Item 11 excludes the following items from calculating PRRT:

  • Amounts corresponding to any GST from defined categories of assessable receipts
  • An amount equal to the GST component of the sale price of property, and
  • An amount equal to the input tax credit entitlement relating to sale expenses.

Item 12 excludes GST components from deductible expenditure when calculating PRRT.

Items 13 and 14 have the effect of including payments of GST within the category of excluded expenditure.

Commencement: The above provisions commence immediately after the commencement of the A New Tax System (Goods and Services Tax) Act 1999, that is, 1 July 2000.

Endnotes

  1. Treasurer, Tax Reform: Not A New Tax A New Tax System, Tax Reform Plan, 13 August 1998.

  2. Pay As You Earn.

  3. Prescribed Payments System.

  4. Reportable Payments System.

  5. Pay As You Go.

  6. Senate Select Committee on A New Tax System; Senate Community Affairs References Committee; Senate Employment, Workplace Relations, Small Business and Education References Committee and Senate Environment, Communications, Information Technology and the Arts References Committee.

  7. Senate Select Committee on A New Tax System, First Report, February 1999.

  8. Senate Community Affairs References Committee, The Lucky Country Goes Begging, Report on the GST and a New Tax System, March 1999; Senate Employment, Workplace Relations, Small Business and Education References Committee, Report of the Inquiry into the GST and A New Tax System, March 1999 and Senate Environment, Communications, Information Technology and the Arts References Committee, Inquiry into the GST and a New Tax System, March 1999.

  9. Senate Select Committee on A New Tax System, Main Report, April 1999.

  10. Senate Select Committee on A New Tax System, Report on Commonwealth-State Financial Arrangements Bills, Luxury Car Tax Bills and Wine Equalisation Tax Bills, April 1999.

  11. Michael Laurence, 'A Tax to Give us All Consumption', Business Review Weekly, 30 July 1999, p. 59.

  12. A subrogation payment is a payment made by a third party to an insurer in respect of a liability owed by the third party to the insured. For example, an insurer makes a settlement to an insured. It takes over the insured's right to recover from the third party who caused the damages to the insured. The insurer then seeks to make recovery from the third party. As a result of that action, the third party makes a payment to the insurer.

  13. Compulsory third party.

  14. That is, after all the Acts listed below have received the Royal Assent and on the day after the last day on which any of those Acts received the Royal Assent:
  • the A New Tax System (Goods and Services Tax) Act 1999
  • the A New Tax System (Goods and Services Tax Imposition-Excise) Act 1999
  • the A New Tax System (Goods and Services Tax Imposition-Customs) Act 1999
  • the A New Tax System (Goods and Services Tax Imposition-General) Act 1999, and
  • the A New Tax System (Goods and Services Tax Administration) Act 1999.
  1. Paragraphs 1 and 2 of Article 50 of the Vienna Convention on Consular Relations is as follows:

Article 50

EXEMPTION FROM CUSTOMS DUTIES AND INSPECTION

  1. The receiving State shall, in accordance with such laws and regulations as it may adopt, permit entry of and grant exemption from all customs duties, taxes, and related charges other than charges for storage, cartage and similar services, on:
  1. articles for the official use of the consular post;

  2. articles for the personal use of a consular officer or members of his family forming part of his household, including articles intended for his establishment. The articles intended for consumption shall not exceed the quantities necessary for direct utilization by the persons concerned.
  1. Consular employees shall enjoy the privileges and exemptions specified in paragraph 1 of this Article in respect of articles imported at the time of first installation.
  1. Article 62 of the Vienna Convention on Consular Relations is as follows:

    EXEMPTION FROM CUSTOMS DUTIES

    The receiving State shall, in accordance with such laws and regulations as it may adopt, permit entry of, and grant exemption from all customs duties, taxes, and related charges other than charges for storage, cartage and similar services on the following articles, provided that they are for the official use of a consular post headed by an honorary consular officer: coats-of-arms, flags, signboards, seals and stamps, books, official printed matter, office furniture, office equipment and similar articles supplied by or at the instance of the sending State to the consular post.

  2. Paragraph 1 of article 36 of the Vienna Convention on Diplomatic Relations is as follows:

    The receiving State shall, in accordance with such laws and regulations as it may adopt, permit entry of and grant exemption from all customs duties, taxes, and related charges other than charges for storage, cartage and similar services, on:

    articles for the official use of the mission;

    articles for the personal use of a diplomatic agent or members of his family forming part of his household, including articles intended for his establishment.

  3. Paragraph 1 and 2 of Article 37, of the Vienna Convention on Diplomatic Relations follows:

1. The members of the family of a diplomatic agent forming part of his household shall, if they are not nationals of the receiving State, enjoy the privileges and immunities specified in Articles 29 to 36.

2. Members of the administrative and technical staff of the mission, together with members of their families forming part of their respective households, shall, if they are not nationals of or permanently resident in the receiving State, enjoy the privileges and immunities specified in Articles 29 to 35, except that the immunity from civil and administrative jurisdiction of the receiving State specified in paragraph 1 of Article 31 shall not extend to acts performed outside the course of their duties. They shall also enjoy the privileges specified in Article 36, paragraph 1, in respect of articles imported at the time of first installation.

Contact Officer and Copyright Details

David Kehhl
24 November 1999
Bills Digest Service
Information and Research Services

This paper has been prepared for general distribution to Senators and Members of the Australian Parliament. While great care is taken to ensure that the paper is accurate and balanced, the paper is written using information publicly available at the time of production. The views expressed are those of the author and should not be attributed to the Information and Research Services (IRS). Advice on legislation or legal policy issues contained in this paper is provided for use in parliamentary debate and for related parliamentary purposes. This paper is not professional legal opinion. Readers are reminded that the paper is not an official parliamentary or Australian government document.

IRS staff are available to discuss the paper's contents with Senators and Members
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ISSN 1328-8091
© Commonwealth of Australia 1999

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Published by the Department of the Parliamentary Library, 1999.

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