Want to be notified of changes, including updates to rulings and forms?
Subscribe to get the latest updates sent directly to you.
Debits tax was payable on all withdrawals on accounts held with financial institutions in Queensland that had cheque-drawing facilities. This included cash, cheque, ATM and EFTPOS withdrawals.
History
Debits tax was originally collected by the Commonwealth. As part of the Commonwealth's 1990–91 Budget strategy, responsibility for collecting debits tax passed to the States.
While the purpose of this was to broaden the State's taxing powers, it did not result in the State receiving any extra revenue. The amount of debits tax collected was deducted from the State's financial assistance grant for the year. Even if a State chose not to collect the tax, their grant was reduced by the amount that would have been collected if it had imposed the tax. For Queensland, this amount was between $65m and $68m per year.
The Debits Tax Act 1990 was abolished on 30 June 2005.
Second Reading speech
The following are extracts from the Second Reading Speech by the Treasurer, Keith E De Lacy, who introduced the Debits Tax Bill into the Legislative Assembly on 21 November 1990.
'The purpose of this Bill is to facilitate the handing over of the collection of debits tax from the Commonwealth to the State.
The move is designed to broaden the State's taxing powers. To facilitate the quick take-over of this tax and to avoid any initial difficulties with nationally based financial institutions having to comply with a number of separate State and Territory Acts, the States' Acts will be uniform and consistent with the existing legislation and the tax will continue to be collected by the Commonwealth under an agency arrangement until 31 December 1992.
I must stress that the Bill does not impose any new obligation on the people of Queensland. The liability to tax parallels that under the existing Commonwealth Act.'