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Commonwealth act
This Act has been repealed and is no longer in force. It is retained for historical reference.
This Act gives legal force in Australia to an international agreement (called a "Convention") struck between Australia and the United States of America to deal with gift duty — a tax that used to be charged when someone gave away property or assets of significant value.
Without this agreement, a person making a gift that had connections to both countries could be taxed twice — once by Australia and once by the US — on the same gift. This Act stops that from happening.
The Convention (the international agreement) does four main things:
Establishes clear rules about where property "lives" for tax purposes (called "situs") — for example, land is taxed where it sits, bank accounts where the bank branch is, ships where they're registered. This prevents both countries from claiming the property is in their territory at the same time.
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Direct links to the current provisions in Gift Duty Convention (United States of America) Act 1953.
Zoe has indexed the source text for search and analysis. Use the official register for the original document and download formats.
View on official registerSourced from the Federal Register of Legislation (legislation.gov.au), CC BY 4.0.
Allows tax credits — if you've already paid gift duty to one country on a particular piece of property, the other country must give you a credit (a reduction in what you owe them) for that amount. You won't pay full tax twice.
Requires information sharing — the Australian and US tax authorities can share information with each other to prevent tax fraud and evasion, though trade secrets are protected and all information is kept confidential.
Provides a dispute resolution mechanism — if a donor or recipient (donee) believes they're being taxed unfairly in breach of the Convention, they can raise it with their home country's tax authority, which will try to negotiate a resolution with the other country.
The Act itself (the Australian law) then sets up the machinery to make this work domestically:
Australia used to impose a federal gift duty on large gifts of property. This Act ensured Australians and Americans weren't penalised just because their gifts crossed borders. Note: Australia's federal gift duty was eventually abolished in 1979, which renders this Act largely of historical interest today — but it remains on the books as part of the treaty relationship with the US.