Bills Digest No. 92 2001-02
Radiocommunications (Transmitter Licence Tax) Amendment
This Digest was prepared for debate. It reflects the legislation as
introduced and does not canvass subsequent amendments. This Digest
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Radiocommunications (Transmitter Licence
Tax) Amendment Bill 2002
Date Introduced: 14 February 2002
House: House of Representatives
Portfolio: Communications, Information Technology and the
Commencement: Item 1 is backdated to
commence on March 29 1996. The transitional provisions commence on
To ensure that a
tax is imposed on the issue of a transmitter licence regardless of
whether an application for the licence has been made.
Radiocommunications are communications between
people and/or objects transmitted using the radiofrequency
spectrum.(1) Television and radio broadcasting are
common forms of radiocommunication.
Commercial and community
broadcasters(2) require a transmitter licence from the
Australian Communications Authority (ACA). These licences specify
the category of service (eg broadcasting, mobile) and technical
conditions (including frequency, power and geographic area). A
transmitter licence authorises the use of radiofrequency spectrum.
Spectrum is valuable for many different communication purposes,
including broadcasting and mobile telephony.(3)
The purpose of the Radiocommunications
(Transmitter Licence Tax) Act 1983 (the Licence Tax Act) is to
impose a tax on transmitter licences held under the
Radiocommunications Act 1992 (RC Act). Under section 7 of
the Licence Tax Act, the amount of tax payable for a transmitter
licence is an amount determined by the ACA. In his second reading
speech, the Minister stated that the justification for the tax is
to encourage efficiency in the use of the spectrum and to provide a
return to the community for the use of a scarce community resource
This Bill is designed to correct an anomaly in
the collection of the licence tax. Under section 6, tax is imposed
on the issue of a licence if it is issued for a period of less than
12 months. However, if the licence is for a period of more than 12
months, subsection 6(4) states that the person should, on
application for the licence, elect to pay tax in relation
to the licence by full up-front payment on issue or in annual
The anomaly arises because a number of
transmitter licences are granted automatically under the RC Act
without the need for an application. For example, under section 102
of the RC Act, the ACA must issue a transmitter licence to a
commercial or community broadcaster who has been issued with a
licence under the Broadcasting Services Act 1992. The ACA
is similarly required under sections 100B and 102A of the RC Act to
issue transmitter licenses to the national broadcasters (ABC and
SBS) and commercial broadcasters to allow them to broadcast in
digital mode. Such licences are, at present, not liable to taxation
under the Licence Tax Act. This anomaly has existed since
Despite the fact that they were not legally
obliged to do so, the Minister has reported that all affected
broadcasting licensees have paid the tax and that no retrospective
payment will be required.(6) The Bill will amend section
6 of the Licence Tax Act to ensure that a tax is payable by a
licensee whether or not the person applied for the licence and will
validate taxes already collected.
Item 1 amends section 6 of the
Licence Tax Act to impose liability on a person granted a
transmitter licence under sections 100B, 102 or 102A of the RC Act
without making an application. Proposed subsection
6(9) provides that before the licence is issued, a person
must elect to pay the tax on the issue of the licence for the
period that the licence is in force (under proposed
subsection 6(7)) or to pay the tax by instalments (under
proposed subsection 6(8)). Proposed
subsection 6(10) states that if no election is made, the
tax will be payable by instalments.
Proposed subsection 6(11)
provides a mechanism for licensees who elected to pay by
instalments to decide to pay the tax outstanding on the remainder
of the licence period.
Under proposed subsection
6(12), if a licensee fails to pay an annual instalment
within 60 days of the payment falling due, the full tax for the
remaining period of the licence will become payable.
Item 2 contains transitional
provisions dealing with issued licences . That is, those issued for
a period of more than 12 months under sections 100B, 102 or 102A of
the RC Act prior to the enactment of this Bill.
Sub-item 2(2) validates
elections purported to have been made by licensees under existing
legislation by deeming them to have been made under
proposed subsection 6(9).
Sub-item 2(3) provides that
licensees who purported to pay tax under the existing section 6 are
taken to have paid it under new subsections 6(7), (8), (11) or
As noted above, the ACA is empowered to issue
determinations stating the amount of tax payable under the Act.
Sub-item 2(5) deems these determinations to
include references to new subsections 6(7), (8), (11) and (12).
This provision is necessary to validate taxes already collected
from licensees without legal authority.
- This spectrum is technically defined as the electromagnetic
frequencies between 3000 hertz (Hz) and 300 gigahertz (Ghz). See
Productivity Commission, Radiocommunications: Draft
Report, February 2002, p.1.
- The Australian Broadcasting Authority also regulates
broadcasters. The ABA has particular powers in relation to matters
of broadcast content.
- Productivity Commission, Radiocommunications: Draft
Report, February 2002, p.xxxvi.
- The Hon. Peter McGauran MP , Second Reading Speech, House of
Representatives, Hansard, 14 February 2002, p.132.
- The Radiocommunications (Transmitter Licence Tax) Amendment
Act 1995 commenced on 29 March 1996.
- The Hon. Peter McGauran MP, Second Reading Speech, House of
Representatives, Hansard, 14 February 2002, p.132.
12 March 2002
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