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Exposure Draft - Goods and Services Tax Treatment of Residential Premises


Monday, 10 April 2006

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On 27 February 2006, the Minister for Revenue and Assistant Treasurer announced the Government’s intention to amend the goods and services tax (GST) law to remove uncertainty in relation to the GST treatment of supplies of some types of real property. (See the Minister for Revenue and Assistant Treasurer’s press release.)

This announcement follows the decision of the Full Federal Court in Marana Holdings Pty Ltd v Commissioner of Taxation [2004] FCAFC 307. The Court’s reasoning has resulted in potential difficulties in distinguishing between supplies of premises that are residential premises and therefore input taxed, and supplies that are taxable.

The Government plans to amend the law, with effect from 1 July 2000, to continue the tax treatment of property that existed prior to the Court’s decision. In particular, the Government aims to ensure that supplies involving properties such as serviced apartments and strata titled units leased to hotel operators are treated as input taxed. This is consistent with the Government's policy intent and will avoid the need for many small investors to register for the GST.

The Government is now releasing the proposed amendments and a draft of the explanatory material for public comment.

The proposed amendments are intended to give effect to the Government’s policy. We invite you to give us your view of how the proposed legislation would affect you (or your clients). This will assist the Government in avoiding unintended consequences from the amendments.

All comments may be treated as public, and could be placed on the Treasury website, unless you clearly indicate that you wish your comments to be treated as confidential.

Submission closing date: 28 April 2006.

The Government aims to introduce the proposed amendments as soon as possible to limit uncertainty.

Address written comments to:

The Manager
GST Policy Unit
Indirect Tax Division
The Treasury
Langton Crescent

Fax: (02) 6263 4320

Email: gstconsultations@treasury.gov.au

Documents Available:

Acrobat (PDF) documents

 Acrobat (PDF)

Explanatory Material (as updated on 12 April 2006 at 3.15pm)  44.98kb
Exposure Draft - Goods and Services Tax Treatment of Residential Premises  11.87kb

Microsoft Word (RTF) documents

 Microsoft Word (RTF)

Explanatory Material (as updated on 12 April 2006 at 3.15pm)  148.92kb
Exposure Draft - Goods and Services Tax Treatment of Residential Premises  59.29kb

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