Duty payable under the Duties Act 2001 on GST inclusive amounts
Prior to commencement of the Commonwealth's goods and services tax (GST) on 1 July 2000, revenue rulings were issued by the Office of State Revenue explaining the way that stamp duty was to be calculated under the Stamp Act 1894 in relation to the GST component for certain instruments and transactions. On commencement of the Duties Act 2001 on 1 March 2002, revenue rulings were reissued to explain the way that duty is calculated under that Act:
- Revenue rulings relating to general insurance - SD 52.1 and DA 6.1.
- Revenue rulings relating to policies of accident insurance under the Workcover Queensland Act 1996 - SD 58.1 and DA 7.1.
- Revenue rulings relating to motor vehicle transfers or applications for registration SD 56.1 and DA 8.1.
- Revenue rulings relating to leases - SD 54.1 and DA 25.2.
- Revenue rulings relating to transfers of property - SD 53.2 and DA 24.1.
- Revenue ruling dealing with Stamp Act 1894 hiring agreements - SD 59.1
As these rulings explain, GST is a component of the supply of the particular good or service and is properly included in the amount on which duty is calculated. Under the Duties Act 2001, this applies for transfer duty, insurance duty and motor vehicle duty.
A recent Victorian decision in Royal and Sun Alliance Insurance Australia Ltd v Commissioner of State Revenue (Vic) held that stamp duty is not payable under the Victorian Stamps Act 1958 on the GST amount of an insurance premium in a policy which separately itemised the GST component from other premium amounts. However, this decision is not considered to alter the way in which duty is imposed under Queensland's Duties Act 2001 in relation to any GST component.
The Honourable Terry Mackenroth, Deputy Premier, Treasurer and Minister for Sport, has confirmed the Government's position that Queensland's duty provisions are, and have always been, considered to apply on a GST inclusive basis. Mr Mackenroth has also stated that, should it be necessary in the future, legislative amendments would be made to retrospectively ensure this is the case.
Therefore, duty under the Duties Act 2001 should continue to be paid on the basis of the Queensland GST revenue rulings. Unpaid tax interest and penalty tax under the Taxation Administration Act 2001 may be imposed where duty is not paid as required.
