38‑450 Leases preceding grants of freeho38‑450 Leases preceding grants of freehold and similar interests by governments

38‑450 Leases preceding grants of freehold and similar interests by governments

(1) A supply by the Commonwealth, a State or a Territory of land on which there are no improvements is GST‑free if: (a) the supply is by way of lease (other than *long‑term lease); and (b) the lease is subject to conditions the satisfaction of which will entitle the *recipient of the supply to the grant of a freehold interest in the land or a long‑term lease of the land. (2) A supply consisting of the surrender, to the Commonwealth, a State or Territory, of a lease over land is GST‑free if: (a) the supplier acquired the land under a supply that: (i) was GST‑free under subsection (1); or (ii) if the supply was made before 1 July 2000—would have been GST‑free under subsection (1) if it had been made on or after that day; and (b) solely or partly in return for the surrender of the lease, the Commonwealth, State or Territory makes a supply of the land to the supplier that is GST‑free under section 38‑445.