National Taxation Reform (Consequential Provisions) Act 2000 (Victoria)

This Act records Victoria’s intention to implement the Intergovernmental Agreement on Commonwealth-State financial reform and creates a small set of consequential mechanisms to operationalise aspects of the goods and services tax (GST) arrangements between the Commonwealth and the States. Mechanically it does four principal things:

Records the Intergovernmental Agreement (the Agreement) by setting it out in the Schedule and states “the intention of the State to comply with, and give effect to, the Intergovernmental Agreement” (s 4(1)-(2); Schedule). The Agreement itself contains extensive administrative, revenue‑sharing and institutional arrangements for the GST (see Schedule, Parts 1-4 and Appendices A-F).
Enables State entities to make voluntary GST‑equivalent payments to the Commonwealth Commissioner of Taxation, and to undertake things “of a kind that it would be necessary or expedient for it to do if it were liable for that GST” (s 5(1)). Subsection 5(2) allows State entities to pay amounts representing interest and penalties that would otherwise apply under the Taxation Administration Act 1953 (Cth) if the GST law applied.
Gives the Treasurer power to issue written directions to State entities requiring them to make those voluntary payments or to do other things authorised by s 5 (s 6). Directions can be retrospective (s 6(3)) and must be complied with “despite any other written law” (s 6(4)).
Allows the Governor in Council, on Minister recommendation, to make regulations increasing fees or charges set by specified statutory rules by an amount or percentage not exceeding the GST payable on the relevant supply (s 7). The increase may be made only once per fee or charge (s 7(5)) and the Minister may recommend only where he or she considers the increase “necessary to cover the increased cost of the supply” as a result of GST implementation (s 7(3)). Part 2 of the Subordinate Legislation Act 1994 does not apply to regulations under s 7(4).

Version No. 004

National Taxation Reform (Consequential Provisions) Act 2000

No. 6 of 2000

Version incorporating amendments as at
1 July 2012

table of provisions

Section Page

Part 1—Preliminary 1

1 Purposes 1

2 Commencement 1

3 Definitions 2

Part 2—Intergovernmental Agreement 4

4 Intergovernmental Agreement 4

Part 3—Payment of GST Equivalents by State Entities 5

5 Voluntary GST equivalent payments 5

6 Directions to State entities 5

part 4—Government Fees and Charges 7

7 Fees set by statutory rules may be increased 7

part 5–10—Repealed 8

8–35 Repealed 8

SCHEDULE—Intergovernmental Agreement on the Reform
of Commonwealth–State Financial Relations 9

ENDNOTES 37

General Information 37
Table of Amendments 38
Explanatory Details 39

Version No. 004

National Taxation Reform (Consequential Provisions) Act 2000

No. 6 of 2000

Version incorporating amendments as at
1 July 2012

The Parliament of Victoria enacts as follows:

Part 1—Preliminary

1 Purposes

The purposes of this Act are—

(a) to record the State's intention to give effect to the Intergovernmental Agreement on the Reform of Commonwealth–State Financial Relations;

(b) to enable State entities to make GST equivalent payments;

(c) to amend the Financial Institutions Duty Act 1982 and the Stamps Act 1958 to discontinue financial institutions duty and stamp duty on certain share transfers and on bookmakers' statements;

(d) to alter government fees and charges to take GST into account;

(e) to amend various Acts as a consequence of national taxation reform.

2 Commencement

(1) This Act, except Parts 8 and 9 and sections 17, 18, 19, 24, 33 and 34, comes into operation on the day after the day on which it receives the Royal Assent.

(2) Section 31 is deemed to have come into operation on 17 February 1999.

(3) The remaining provisions of Part 9 and sections 17, 18, 19, 24, 33 and 34 come into operation on 1 July 2000.

(4) Part 8 comes into operation on 3 July 2000.

3 Definitions

s. 3

In this Act—

Commissioner of Taxation means the person holding office for the time being as Commissioner of Taxation under the Taxation Administration Act 1953 of the Commonwealth;

GST has the same meaning as it has in the A New Tax System (Goods and Services Tax) Act 1999 of the Commonwealth;

GST Imposition Acts means the following Acts of the Commonwealth—

(a) A New Tax System (Goods and Services Tax Imposition—Customs) Act 1999;

(b) A New Tax System (Goods and Services Tax Imposition—Excise) Act 1999;

S. 3 def. of GST law inserted by No. 42/2012 s. 9.

GST law has the same meaning as it has in the A New Tax System (Goods and Services Tax) Act 1999 of the Commonwealth;

S. 3 def. of interest inserted by No. 42/2012 s. 9.

interest means the general interest charge the liability for which arises under the Taxation Administration Act 1953 of the Commonwealth and which would otherwise be payable if the GST law applied to a State entity;

Intergovernmental Agreement means the Intergovernmental Agreement on the Reform of Commonwealth–State Financial Relations set out in the Schedule;

S. 3 def. of penalties inserted by No. 42/2012 s. 9.

penalties means any penalties imposed in respect of GST by Part 4-25 of Schedule 1 to the Taxation Administration Act 1953 of the Commonwealth and which would otherwise be payable if the GST law applied to a State entity;

State entity means a person that is not liable for GST that it would be liable for if—

(a) the imposition of that GST were not prevented by section 114 of the Commonwealth Constitution; and

(b) section 5 of each of the GST Imposition Acts had not been enacted.

s. 3

Part 2—Intergovernmental Agreement

4 Intergovernmental Agreement

s. 4

(1) A copy of the Intergovernmental Agreement on the Reform of Commonwealth–State Financial Relations is set out in the Schedule.

(2) It is the intention of the State to comply with, and give effect to, the Intergovernmental Agreement.

Part 3—Payment of GST Equivalents by State Entities

S. 5
amended by No. 42/2012 s. 10 (ILA s. 39B(1)).

5 Voluntary GST equivalent payments

s. 5

(1) A State entity may pay to the Commissioner of Taxation amounts representing amounts that would have been payable for GST if—

(a) the imposition of that GST were not prevented by section 114 of the Commonwealth Constitution; and

(b) section 5 of each of the GST Imposition Acts had not been enacted—

and may do things of a kind that it would be necessary or expedient for it to do if it were liable for that GST.

S. 5(2) inserted by No. 42/2012 s. 10.

(2) Without limiting subsection (1), a State entity may also pay to the Commissioner of Taxation amounts representing amounts that would have been payable as penalties or interest in respect of amounts paid under subsection (1) if—

(a) the imposition of that GST were not prevented by section 114 of the Commonwealth Constitution; and

(b) section 5 of each of the GST Imposition Acts had not been enacted.

6 Directions to State entities

(1) The Treasurer may give a State entity written directions that it—

(a) make payments that it is authorised by section 5 to make;

(b) do anything else that it is authorised by that section to do.

(2) The Treasurer, by a further written direction given to the State entity, may amend or revoke a direction previously given under this section.

(3) Requirements in a direction under this section may relate to things that have happened before the direction was given.

(4) A State entity is to comply with directions under this section despite any other written law.

s. 6

Part 4—Government Fees and Charges

7 Fees set by statutory rules may be increased

s. 7

(1) The Governor in Council, on the recommendation of the Minister, may make regulations providing for a fee or charge set by a statutory rule specified in the regulations to be increased by an amount or a percentage specified in the regulations.

(2) Except as provided in subsection (6), the increase in the fee or charge cannot exceed the amount of GST payable on the supply to which the fee or charge relates.

(3) The Minister may make a recommendation under subsection (1) only if he or she considers that the increase in the fee or charge is necessary to cover the increased cost of the supply to which the fee or charge relates as a result of the implementation of—

(a) the A New Tax System (Goods and Services Tax) Act 1999 of the Commonwealth; and

(b) the GST Imposition Acts; and

(4) Part 2 of the Subordinate Legislation Act 1994 does not apply to regulations made under this section.

(5) A fee or charge may be increased only once under this section.

(6) In determining the amount of GST payable on the supply to which a fee or charge relates for the purposes of regulations under this section, the fee or charge is to be taken to be payable in relation to supplies made wholly on or after 1 July 2000.

(7) Despite subsection (6), the increase in a fee or charge under this section does not apply to that part of the supply to which the fee or charge relates that is in respect of the period before 1 July 2000 and any such fee or charge must be reduced accordingly.

(8) In this section—

s. 7

GST includes notional GST of the kind for which payments may be made under Part 3 by a State entity.

Pts 5–10 (Headings and ss 8–35) repealed by No. 28/2007 s. 3(Sch. item 45).

SCHEDULE

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Section 4

Intergovernmental Agreement on the Reform of Commonwealth–State Financial Relations

THE COMMONWEALTH OF AUSTRALIA

THE STATE OF NEW SOUTH WALES

THE STATE OF VICTORIA

THE STATE OF QUEENSLAND

THE STATE OF WESTERN AUSTRALIA

THE STATE OF SOUTH AUSTRALIA

THE STATE OF TASMANIA

THE AUSTRALIAN CAPITAL TERRITORY, AND

THE NORTHERN TERRITORY OF AUSTRALIA

WHEREAS

(1) the Special Premiers’ Conference on 13 November 1998 developed principles for the reform of Commonwealth–State financial relations;

(2) the Commonwealth, States and Territories are in agreement that the current financial relationship between levels of government must be reformed to facilitate a stronger and more productive federal system for the new millennium;

(3) while a majority of the States and Territories support the introduction of the Goods and Services Tax (GST), the agreement of New South Wales, Queensland and Tasmania to the reform of Commonwealth–State financial relations does not imply their in-principle endorsement of the GST;

(4) an Agreement was reached between the Commonwealth and the States and Territories on the reform of Commonwealth–State financial relations on 9 April 1999;

(5) this revised Agreement was made necessary by the changes to the Commonwealth Government’s A New Tax System (ANTS) package announced by the Prime Minister on 28 May 1999; and

(6) this revised Agreement supersedes the previous Agreement of 9 April 1999:

IT IS HEREBY AGREED:

PART 1—PRELIMINARY

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Commencement Clause

This Agreement will commence between the Commonwealth, the States and the Territories on 1 July 1999 unless otherwise agreed by the Parties.

Objectives

The objectives of the reforms set down in this agreement include:

(i) the achievement of a new national tax system, including the elimination of a number of existing inefficient taxes which are impeding economic activity;

(ii) the provision to State and Territory Governments of revenue from a more robust tax base that can be expected to grow over time; and

(iii) an improvement in the financial position of all State and Territory Governments, once the transitional changes have been completed, relative to that which would have existed had the current arrangements continued.

All Parties to the Agreement acknowledge the need to pursue on-going reform of Commonwealth–State financial relations.

Acknowledgment of Agreement

The Commonwealth will attach the Agreement as a schedule to the A New Tax System (Commonwealth–State Financial Arrangements) Act 1999. The Commonwealth will use its best endeavours to ensure the Act will require compliance with the Agreement. The States and Territories will attach the Agreement as a schedule to relevant State and Territory legislation. The States and Territories will use their best endeavours to ensure their legislation will require compliance with the Agreement.

PART 2—COMMONWEALTH-STATE FINANCIAL REFORM

Reform Measures

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The Parties will undertake all necessary steps to have appropriate legislation enacted to give effect to the following reform measures.

(i) The Commonwealth will legislate to provide all of the revenue from the GST to the States and Territories and will legislate to maintain the rate and base of the GST in accordance with this Agreement.

(ii) The Commonwealth will cease to apply the Wholesale Sales Tax from 1 July 2000 and will not reintroduce it or a similar tax in the future.

(iii) The temporary arrangements for the taxation of petrol, liquor and tobacco under the safety net arrangements announced by the Commonwealth on 6 August 1997 will cease on 1 July 2000.

(iv) The payment of Financial Assistance Grants will cease on 1 July 2000.

(v) The Commonwealth will continue to provide Specific Purpose Payments (SPPs) to the States and Territories and has no intention of cutting aggregate SPPs as part of the reform process set out in this Agreement, consistent with the objective of the State and Territory Governments being financially better off under the new arrangements.

(vi) The States and Territories will cease to apply the taxes referred to in Appendix A from the dates outlined below and will not reintroduce them or similar taxes in the future.

Bed taxes, from 1 July 2000;
Financial Institutions Duty, from 1 July 2001;
Stamp duties on quoted marketable securities from 1 July 2001;
Debits tax by 1 July 2005, subject to review by the Ministerial Council;

(vii) The Ministerial Council will by 2005 review the need for retention of stamp duty on non-residential conveyances; leases; mortgages, debentures, bonds and other loan securities; credit arrangements, installment purchase arrangements and rental arrangements; and on cheques, bills of exchange, promissory notes; and unquoted marketable securities.

(viii) The States and Territories will adjust their gambling tax arrangements to take account of the impact of the GST on gambling operators.

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(ix) Following negotiations under the CSHA, the States and Territories will ensure that increases in pensions and allowances specified in the tax reform package will not flow through to increased public housing rents where these rents are linked to the level of pensions.

(x) Nothing in this clause will prevent any Party from introducing anti-avoidance measures that are reasonably necessary to protect its remaining tax base or liabilities accrued prior to the date the tax ceases to apply.

GST Legislation

All Parties agree to reconsider this Agreement should the Commonwealth Parliament pass the GST legislation in a way that significantly affects this Agreement.

Distribution of GST Revenue

The Commonwealth will make GST revenue grants to the States and Territories equivalent to the revenue from the GST subject to the arrangements in this Agreement. GST revenue grants will be freely available for use by the States and Territories for any purpose.
The Commonwealth will distribute GST revenue grants among the States and Territories in accordance with horizontal fiscal equalisation (HFE) principles subject to the transitional arrangements set out below and other relevant provisions of this Agreement.
Details of the payment arrangements are contained in Appendix B to this Agreement.

Transitional Arrangements

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In each of the transitional years following the introduction of the GST, the Commonwealth guarantees that the budgetary position of each individual State and Territory will be no worse off than it would have been had the reforms set out in this Agreement not been implemented.
The Commonwealth will extend the transitional period by Regulation (as provided for in the A New Tax System (Commonwealth–State Financial Arrangements) Act 1999) to give effect to the commitments in clause 10 in the event that transitional assistance is required by any State or Territory after 30 June 2003.
To meet this guarantee, the Commonwealth will make transitional assistance payments to each State and Territory, as necessary, over this period. These payments will take the form of interest free loans and grants in July 2000–01 and grants paid quarterly in subsequent years and will be freely available for use by the States and Territories for any purpose. Any payments or repayments made by way of loans or grants under the Commonwealth’s guarantee will be excluded from assessments of per capita relativities recommended by the Commonwealth Grants Commission (CGC).
The amounts of any additional assistance under the guarantee will be determined in accordance with the processes set out in Appendix C to this Agreement.
After the second year following the introduction of the GST, GST revenue grants will be determined on the basis of HFE principles. That is, after the first two years, any State or Territory which is receiving more than would have been received under the current arrangements will retain that excess.

First Home Owners Scheme

To offset the impact of the introduction of a GST, the States and Territories will assist first homebuyers through the funding and administration of a new uniform First Home Owners Scheme.

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This assistance will be provided to first home owners consistent with Appendix D to this Agreement.

Application of the GST to Government

The Parties intend that the Commonwealth, States, Territories and local government and their statutory corporations and authorities will operate as if they were subject to the GST legislation. They will be entitled to register, will pay GST or make voluntary or notional payments where necessary and will be entitled to claim input tax credits in the same way as non-Government organisations. All such payments will be included in GST revenue.
The Commonwealth will legislate to require the States and the Northern Territory to withhold from any local government authority being in breach of clause 17 a sum representing the amount of unpaid voluntary or notional GST payments. Amounts withheld will form part of the GST revenue pool. Detailed arrangements will be agreed by the Ministerial Council on advice from Heads of Treasuries.

Government Taxes and Charges

The Commonwealth, States and Territories agree that the GST does not apply to the payment of some taxes and compulsory charges.
The Parties will agree a list of taxes and compulsory charges that are outside the scope of the GST. This list will be promulgated by a determination by the Commonwealth Treasurer as set out in Division 81-5 of the A New Tax System (Goods and Services Tax) Act 1999 (the GST Act).
In agreeing the list, the Commonwealth, States and Territories will have regard to the following principles:

(i) taxes that are in the nature of a compulsory impost for general purposes and compulsory charges by the way of fines or penalties should not be subject to GST as these will not relate to any specific supply of goods or services;

(ii) similarly, those regulatory charges that do not relate to particular goods or services should be outside the scope of the GST; and

(iii) the inclusion of any other charge in the Commonwealth Treasurer’s determination notwithstanding that it may relate to the supply of a particular good or service will require the unanimous agreement of the Commonwealth, States and Territories.

The agreed list of taxes and other compulsory charges that are outside the scope of the GST will be subject to on-going review and adjustment as necessary in consultation with the Ministerial Council. The Parties will notify any objections to changes to the list within a period to be specified by the Ministerial Council.

Reciprocal Taxation

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Reciprocal taxation will be progressed on a revenue neutral basis, through the negotiation of a Reciprocal Taxation Agreement with the objectives of:

(i) improving the transparency of tax arrangements between all levels of government;

(ii) ensuring tax neutrality; and

(iii) replacing the Statement of Policy Intent (SOPI) for the taxation treatment of Government Business Enterprises with tax arrangements which are broader in scope.

It is the intention of the Parties to this Agreement that a National Tax Equivalent Regime (NTER) for income tax will be operational for State and Territory government business enterprises from 1 July 2000. It is also intended that the reciprocal application of other Commonwealth, State and Territory taxes will be subsequently implemented as soon as practicable.
Local government organisations will be consulted with a view to making the NTER for income tax operational for wholly owned local government business enterprises from 1 July 2000 and including local government in the Reciprocal Tax Agreement at a later date.
Where the application of full indirect reciprocal tax arrangements is prevented by the Constitution, jurisdictions have agreed to work cooperatively to introduce voluntary payment arrangements in these circumstances.
All governments have agreed that no further compensation payments will be payable by any jurisdiction under the SOPI.

Monitoring of Prices

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In accordance with the Trade Practices Act 1974, as amended, the Australian Competition and Consumer Commission will formally monitor prices and take action against businesses that take pricing decisions in a manner inconsistent with tax reform.
In order to ensure that these measures apply to the whole economy, the States and Territories will adopt the Schedule version of Part VB of the Trade Practices Act 1974 (Part XIAA of The New Tax System Price Exploitation Code) to extend the measures in Part VB to cover those areas outside the Commonwealth’s constitutional power. All Parties will work towards having any necessary legislation in place by 1 July 1999.
The monitoring and prohibition on unreasonable pricing decisions will commence on 1 July 1999 and continue until 30 June 2002.

PART 3—ADMINISTRATION OF THE GST

Management of the GST Rate

After the introduction of the GST, a proposal to vary the 10 per cent rate of the GST will require:

(i) the unanimous support of the State and Territory Governments;

(ii) the endorsement by the Commonwealth Government of the day; and

(iii) the passage of relevant legislation by both Houses of the Commonwealth Parliament.

Management of the GST Base

Subject to clauses 34, 35 and 36 of this Agreement, after the introduction of the GST, any proposal to vary the GST base will require:

(i) the unanimous support of the State and Territory Governments;

(ii) the endorsement by the Commonwealth Government of the day; and

(iii) the passage of relevant legislation by both Houses of the Commonwealth Parliament.

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All future changes to the GST base should be consistent with:

(i) the maintenance of the integrity of the tax base;

(ii) simplicity of administration; and

(iii) minimising compliance costs for taxpayers.

A proposal to vary the GST base by way of a Ministerial determination under the GST Act and the GST Transition Act will require the unanimous agreement of the Ministerial Council established under clause 40. The Ministerial Council will develop practical arrangements to ensure timely consideration of proposed Ministerial determinations.
During the first 12 months following the implementation of the GST, the Commonwealth Government will retain the discretion to make changes unilaterally to the GST base where such changes:

(i) are of an administrative nature (as defined in Appendix E to this Agreement);

(ii) are necessary to facilitate the implementation of the new tax; and

(iii) have regard to the need to protect the revenue of the States and Territories.

From July 2001, changes to the GST base of an administrative nature (as defined in Appendix E) would require the majority support of the Commonwealth, the States and the Territories.

Australian Taxation Office

The States and Territories will compensate the Commonwealth for the agreed costs incurred by the Australian Taxation Office (ATO) in administering the GST.
Accountability and performance arrangements will be established between the ATO and the State and Territory Governments consistent with Appendix F to this Agreement. These arrangements will include maximising compliance, cost efficiency, simplicity for taxpayers and administrative transparency.
The ATO and State and Territory Governments will collaborate to explore options for the States and Territories to benefit from the use of the Australian Business Number system.

PART 4—INSTITUTIONAL ARRANGEMENTS

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Establishment of Ministerial Council

A Ministerial Council comprising the Commonwealth, the States and the Territories will be established from 1 July 1999 to oversee the operation of this Agreement.
The membership of the Ministerial Council will comprise the Treasurer of the Commonwealth and the Treasurers of the States and Territories (or designated representatives).
The functions of the Ministerial Council will include:

(i) the oversight of the operation of the GST;

(ii) the oversight and coordination of the implementation of this Agreement;

(iii) the review of matters of operational significance raised through the GST Administration Sub-Committee;

(iv) discussion of CGC recommendations regarding relativities prior to the Commonwealth Treasurer making a determination;

(v) monitoring compliance with the conditions governing the provision of assistance to first home owners set out in Appendix D to this Agreement;

(vi) monitoring compliance with the Commonwealth’s undertaking with respect to SPPs;

(vii) considering reports of the GST Administration Sub-Committee on the performance of the ATO in GST administration;

(viii) reviewing the operation of the Agreement over time and considering any amendments which may be proposed as a consequence of such review;

(ix) making recommendations to the Commonwealth Treasurer on the Guaranteed Minimum Amount applying to each State and Territory under the Transitional Arrangements;

(x) approving changes to the GST base which require the support of a majority of Commonwealth, State and Territory Governments;

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(xi) considering on-going reform of Commonwealth–State financial relations; and

(xii) considering other matters covered in this Agreement.

The Treasurer of the Commonwealth will convene the Ministerial Council in consultation with the other members of the Council not less than once each financial year. If the Commonwealth Treasurer receives a request from a member of the Council, he will consult with the other members concerning convening a meeting. The Treasurer of the Commonwealth will be the chair of the Council. The Council may also conduct its business by correspondence.
All questions arising in the Ministerial Council will be determined by unanimous agreement unless otherwise specified in this Agreement.
While it is envisaged that the Ministerial Council will take decisions on most business arising from the operation of this Agreement, major issues will be referred by the Ministerial Council to Heads of Government for consideration, including under the auspices of the Council of Australian Governments.
The Ministerial Council will establish a GST Administration Sub-Committee comprised of Commonwealth, State and Territory officials to monitor the operation of the GST, make recommendations regarding possible changes to the GST base and rate and to monitor the ATO’s performance in GST administration. The GST Administration Sub-Committee will function in accordance with the arrangements set out in Appendix E to this Agreement.

SIGNED for and on behalf of the Parties by:

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The Honourable John Winston Howard, Prime Minister of the Commonwealth of Australia, on the 20th day of June 1999
The Honourable Robert John Carr, Premier of the State of New South Wales, on the 24th day of June 1999
The Honourable Jeffrey Gibb Kennett, Premier of the State of Victoria, on the 26th day of June 1999
The Honourable Peter Douglas Beattie, Premier of the State of Queensland, on the 25th day of June 1999
The Honourable Richard Fairfax Court, Premier of the State of Western Australia, on the 29th day of June 1999
The Honourable John Wayne Olsen, Premier of the State of South Australia, on the 25th day of June 1999
The Honourable James Alexander Bacon, Premier of the State of Tasmania, on the 25th day of June 1999
Kate Carnell, Chief Minister of the Australian Capital Territory, on the 22nd day of June 1999
The Honourable Denis Gabriel Burke, Chief Minister of the Northern Territory of Australia, on the 22nd day of June 1999

APPENDICES

A: Taxes Subject to Reform

B: Payment of GST Revenues to the States and Territories

C: Transitional Arrangements

D: First Home Owners Scheme

E: GST Administration

F: GST Administration Performance Agreement—Guiding Principles

APPENDIX A

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TAXES SUBJECT TO REFORM

The taxes which will cease to apply in accordance with paragraph 5 of this Agreement are set out below and in the relevant Commonwealth, State and Territory statutes as at 13 November 1998.

A1. The following taxes will cease to apply from 1 July 2000:

(i) Wholesale Sales Tax

Sales tax levied on the value of the last wholesale sale of goods sold or otherwise dealt with as imposed by the Commonwealth’s Sales Tax (Imposition) Acts.

(ii) Bed Taxes

Accommodation taxes levied on the cost of temporary residential accommodation.

A2. The following State and Territory taxes will cease to apply from 1 July 2001:

(i) Financial Institutions Duty

Financial Institutions Duty levied on the value of receipts (credits) at financial institutions and on the average daily liabilities and/or investments of short term money market dealers.

(ii) Stamp Duty on Marketable Securities

Stamp duty levied on turnover (ie sale price times quantity traded) on the transfer of marketable securities quoted on the ASX or another recognised stock exchange.

This excludes transfers of marketable securities in private companies and trusts, and in public companies and trusts where the securities are not quoted on the ASX or another recognised stock exchange.

A3. The following State and Territory tax will cease to apply by 1 July 2005, subject to review by the Ministerial Council:

(i) Debits Tax

Debits tax levied on the value of withdrawals (debits) from accounts with financial institutions with cheque drawing facilities.

Debits duty levied on transactions, including credit card transactions. This does not include stamp duty on electronic debits (refer A4 (v) below).

A4. The Ministerial Council will by 2005 review the need for retention of stamp duties on the following:

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(i) Stamp Duty on Non-residential Conveyances

Stamp duty levied on the value of conveyances other than residential property conveyances.

(ii) Stamp Duty on Non-quotable Marketable Securities

Stamp duty levied on transfers of marketable securities in private companies and trusts, and in public companies and trusts where the securities are not quoted on the ASX or another recognised stock exchange.

(iii) Stamp Duty on Leases

Stamp duty levied on the rental payable under tenancy agreements.

(iv) Stamp Duty on Mortgages, Bonds, Debentures and Other Loan Securities

Stamp duty levied on the value of a secured loan property.

(v) Stamp Duty on Credit Arrangements, Installment Purchase Arrangements and Rental Arrangements

Stamp duty levied on the value of the loan under credit arrangements.

Stamp duty levied on credit business in respect of loans made, discount transactions and credit arrangements.

Stamp duty levied on the price of goods purchased under installment purchase arrangements.

Stamp duty levied on the rent paid in respect of the hire of goods, including consumer and producer goods.

(vi) Stamp Duty on Cheques, Bills of Exchange and Promissory Notes

Stamp duty levied on cheques, bills of exchange, promissory notes, or other types of payment orders, promises to pay or acknowledgment of debts, including duty on electronic debits.

APPENDIX B

PAYMENT OF GST REVENUES TO THE STATES AND TERRITORIES

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B1. Subject to the transitional arrangements and other relevant provisions in this Agreement, the Commonwealth will distribute GST revenue grants among the States and Territories in accordance with horizontal fiscal equalisation (HFE) principles.

B2. The pool of funding to be distributed according to HFE principles in a financial year will comprise GST revenue grants and health care grants as defined under an Australian Health Care Agreement between the Commonwealth and the States and Territories. A State or Territory’s share of the pool will be based on its population share, adjusted by a relativity factor which embodies per capita financial needs based on recommendations of the Commonwealth Grants Commission. The relativity factor for a State or Territory will be determined by the Commonwealth Treasurer after he has consulted with each State and Territory.

B3. The total amount of GST revenue to be provided to the States and Territories in a financial year will be defined as:

(i) the sum of GST collections, voluntary and notional payments made by government bodies, and amounts withheld pursuant to clause 18; reduced by

(ii) the amounts paid or applied under Division 35 of the GST Act and under section 39 of the Taxation Administration Act 1953.

B4. The total amount of GST revenue in a financial year will be determined by the Commissioner of Taxation in the following way:

(i) actual outcomes for the items listed in paragraph B3 for the period 1 July to 31 May; plus

(ii) estimated outcomes for the items listed in paragraph B3 for the month of June; plus

(iii) an adjustment amount (which may be positive or negative) to account for any difference between the estimated and actual outcome for the items listed in paragraph B3 for the month of June in the previous year.

B5. GST revenue grants will be paid by the Commonwealth on the twenty-seventh day of each month. Where the scheduled payment day is a Saturday, Sunday or public holiday in Canberra, the payment will be made on the next business day of the Reserve Bank of Australia in Canberra.

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B6. The States and Territories shall be informed of the quantum of each monthly payment by close of business Canberra time on the twenty sixth day of each month. Where the day is a Saturday, Sunday or public holiday in Canberra, the States and Territories shall be informed of the quantum of the payment on the last business day of the Reserve Bank of Australia in Canberra prior to payment day.

B7. The distribution between the States and Territories of the payments of GST revenue grants up to 15 June in each year will be based on:

(i) the Treasurer’s determination of per capita relativities;

(ii) the latest available Australian Bureau of Statistics’ projections, or estimates, of State and Territory populations as at 31 December;

(iii) the latest available Department of Health and Aged Care estimates of health care grants to be provided to a State or Territory; and

(iv) the latest available estimates of the guaranteed minimum amount for each State and Territory to be calculated under Appendix C of this Agreement.

The Commonwealth will inform the States and Territories of any changes to the estimates as part of the advice to be provided to the States and Territories under paragraph B6.

B8. The payments of GST revenue grants after 15 June in each year will take into account the determinations of:

(i) per capita relativities and Guaranteed Minimum Amounts by the Treasurer;

(ii) populations by the Statistician;

(iii) health care grants by the Minister administering the National Health Act 1953; and

(iv) GST revenues by the Commissioner of Taxation.

For this purpose, the final payment will be made no later than the seventeenth day of June in each year. Where the seventeenth day of June is a Saturday, Sunday or public holiday in Canberra, the payment will be made on the next business day of the Reserve Bank of Australia in Canberra.

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B9. States shall be informed of the quantum of the final monthly payment of GST revenues grants by close of business Canberra time on the sixteenth day of June. Where the sixteenth day of June is a Saturday, Sunday or public holiday in Canberra, the Commonwealth shall inform the States of the quantum of the final payment on the last business day of the Reserve Bank of Australia in Canberra prior to the thirteenth.

B10. The timing of payments of GST revenue grants may be varied by agreement between the Parties to this Agreement.

APPENDIX C

TRANSITIONAL ARRANGEMENTS

Guarantee in Legislation

C1. Commonwealth legislation will provide a State or Territory with an entitlement to an additional amount of funding from the Commonwealth to offset any shortfall between its entitlement to GST revenue grants and the total amount of funding which would ensure that the budgetary position of a State or Territory is not worse off during the transition period.

(i) In 2000–01, transitional assistance will be provided to a State or Territory as a grant or an interest free loan to be repaid to the Commonwealth in full in 2001–02.

(ii) In subsequent transitional years, transitional assistance will be provided to a State or Territory as a grant.

Guaranteed Minimum Amount

C2. The amount of a State or Territory’s entitlement to transitional assistance in a financial year will be calculated by subtracting its entitlement to GST revenue grants from a “Guaranteed Minimum Amount” constructed in the following way:

State revenues forgone: financial assistance grants, revenue replacement payments and State and Territory taxes as defined in Appendix A of this Agreement with the exception of stamp duties on marketable securities which will be the amount as if fully abolished.

Sch.

plus

Reduced revenues: the amount by which States and Territories adjust gambling taxation arrangements to take account of the impact of the GST on gambling operators.

plus

Interest costs on cash flow shortfalls: the interest cost incurred by States and Territories as a result of the change to cash flows arising from the replacement of weekly financial assistance grants, revenue replacements and State and Territory taxes with monthly GST revenue grants.

plus

Loan Repayments: in 2001–02 only, the repayment of a guarantee loan by a State or Territory.

plus

Additional expenditures: payments to first home owners in accordance with Appendix D of this Agreement and the amount of the agreed GST administration costs payable to the ATO by a State or Territory.

plus

Other items: $338 million spread evenly over three years starting in 2000–01 in respect of the claim by States and Territories in relation to revenue forgone from the abolition of the Wholesale Sales Tax (WST) Tax Equivalent Regimes (with the distribution to be agreed among the States and Territories).

minus

Reduced expenditures: off-road diesel subsidies and reduced costs from the removal of embedded WST and excises on purchases by a State or Territory government.

minus

Growth dividend: the increase in revenue to a State or Territory (not including GST revenue payments) that is attributable to the impact of the Commonwealth’s taxation reform measures on economic growth.

plus

Adjustments: from 2001–02, the net difference between preliminary estimates and outcomes or final estimates for items that were taken into account in the previous year’s Guaranteed Minimum Amount.

In addition, $269 million in total, spread evenly over three years, will be included in the new Commonwealth State Housing Agreement starting in 2000-01 in respect of the net increased public housing costs as a result of tax reform (with the distribution to be agreed among the States and Territories).

Sch.

Heads of Treasuries’ Advice to Ministerial Council

C3. The Guaranteed Minimum Amount for a State or Territory will be determined by the Commonwealth Treasurer by 10 June of each year of the transition period. The Ministerial Council will make recommendations to the Treasurer on the Guaranteed Minimum Amount for each State and Territory.

C4. The Heads of Treasuries will provide written advice to the Ministerial Council on the following issues by the indicated dates.

(i) By 1 March 2000, advice on the estimated loans and grants to be provided to each State and Territory in 2000–01 and the amounts which the Commonwealth should provide to each State and Territory on Tuesday 4 July 2000.

(ii) By 1 November 2000 advice on the most recent estimates of transitional assistance for the year and any adjustment that may need to be made to the amount of the loans and grants made to each State and Territory.

(iii) By 1 September of each subsequent year of the transition period, advice on the most recent estimates of the transitional assistance to be provided to each State and Territory in the financial year and the installment amounts which the Commonwealth should provide to each State and Territory on the first Tuesday of the following October and January. This advice should identify the adjustments for the net difference between preliminary estimates and outcomes or final estimates for items that were taken into account in the previous year's Guaranteed Minimum Amount for a State or Territory.

(iv) By 1 March of each subsequent year of the transition period, advice on the most recent estimates of the transitional assistance to be provided to each State and Territory in both the current financial year and the next financial year, and the installment amounts which the Commonwealth should provide to each State and Territory on the first Tuesday of the following April and July.

(v) By 1 June of each year of the transition period, advice on the Guaranteed Minimum Amount for each State and Territory in the current financial year.

Frequency and Amounts of Payments and Repayments

Sch.

C5. In each year of the transitional period after 2000–01, the Commonwealth will provide an installment of the guarantee payment to a State or Territory on the first Tuesday (or the first business day thereafter) of January, April, July and October. The installment amounts will reflect the advice to be provided to the Ministerial Council by the Heads of Treasuries under paragraph C4.

C6. Adjustments to the total amount of additional assistance to a State or Territory in light of actual GST collections and the Treasurer's determination of the Guaranteed Minimum Amount will be made in conjunction with the payments of GST revenue grants after 10 June in each year.

C7. A State or Territory will repay a loan which it receives from the Commonwealth in 2000–01 in quarterly installments in 2001–02. These installments will be paid to the Commonwealth on the same day on which a State or Territory receives an amount of GST revenue grants in the months of July, October, January and April.

C8. The methodology for calculating the amounts of particular components of the Guaranteed Minimum Amount for a State or Territory has been agreed by the Heads of Treasuries and is set out in the document titled Methodology for Estimation of Components of the Guaranteed Minimum Amount.

APPENDIX D

FIRST HOME OWNERS SCHEME

Principles

D1. The States and Territories will make legislative provision for the First Home Owners Scheme (FHOS) from 1 July 2000 which will incorporate programme criteria consistent with the following principles:

(i) Eligible applicants will be entitled to $7,000 assistance (per application) on eligible homes under the FHOS.

Sch.

(ii) Assistance will be available directly as a one off payment. If the recipient expressly consents, it may be available as an offset against statutory levies and charges or some combination of these.

(iii) Eligible applicants must be natural persons who are Australian citizens or permanent residents who are buying or building their first home in Australia. An applicant's spouse (or de facto) must be included on the application.

(iv) To qualify for assistance, neither the applicant or the applicant's spouse (or de facto) must have previously owned a home, either jointly, separately or with some other person.

(v) Entering into a binding contract or commencement of building in the case of owner builders, must have occurred on or after 1 July 2000.

(vi) An eligible home will be a new or established house, home unit, flat or other type of self contained fixed dwelling that meets local planning standards. Fixed dwellings will include demountable dwellings where these meet local planning standards.

(vii) An eligible home must be intended to be a principal place of residence and occupied within a reasonable period. The home must be located in the State or Territory in which the application is made. Applicants who have entered into a financing mechanism which involves a shared equity arrangement will be eligible.

(viii) Assistance will not be means tested.

(ix) The relevant State and Territory legislation will contain adequate administrative review and appeal mechanisms, along with provision to prevent abuse of the FHOS. The States and Territories will cooperate in the exchange of information to identify eligible first home owners.

Other matters

D2. Funding of grants under the FHOS may not be drawn from Home Purchase Assistance (HPA) funds provided through the Commonwealth State Housing Agreement, including the pool of existing HPA revenues.

Sch.

D3. Further details concerning eligibility criteria consistent with the above principles are to be agreed between the Commonwealth and each State and Territory.

D4. The States and Territories will not introduce or vary any taxes or charges associated with home purchase with the intention of offsetting the benefits of the FHOS for recipients.

APPENDIX E

GST ADMINISTRATION

E1. The Commissioner of Taxation has the general administration of the GST law.

E2. The ATO will arrange for the Australian Customs Service to assist with the collection of the GST on imports.

E3. During the first 12 months following the implementation of the GST, the Commonwealth will retain the discretion to make changes to the GST base of an administrative nature. For this purpose, changes of an administrative nature involves legislation necessary to:

(i) protect the integrity of the GST base; or

(ii) prevent tax avoidance.

E4. The Commonwealth will include the definition of change of an administrative nature in the A New Tax System (Commonwealth–State Financial Arrangements) Bill 1999.

E5. From July 2001, changes of an administrative nature as defined in E3 will require the majority support of the Commonwealth, States and Territories.

E6. The GST Administration Sub-Committee, which will commence operation from 1 July 1999, will monitor the operation and administration of the GST and make recommendations regarding modifications to the GST and the administration of the GST.

E7. The GST Administration Sub-Committee will comprise officials from each Party to the Agreement including representatives from the ATO as required. The Commonwealth Treasury will chair the GST Administration Sub-Committee.

E8. The Chair will convene the GST Administration Sub-Committee in consultation with other members of the Sub-Committee as often as may be necessary to conduct its business. If the Chair receives a request from a member of the Sub-Committee, the Chair will consult with the other members concerning convening a meeting.

Sch.

E9. The functions of the Sub-Committee will include:

(i) monitoring the performance of the ATO in the administration of the GST (Appendix F of this Agreement);

(ii) the assessment of policy proposals for the modification of the GST rate and base;

(iii) making recommendations to the Ministerial Council on the need for legislation which might significantly affect the GST base; and

(iv) requesting the ATO to produce draft Public Rulings in specified areas.

E10. The States and Territories will be consulted on draft Public Rulings prior to consideration by the ATO Rulings Panel and before public consultation. There will be a representative from the States and Territories on the ATO Rulings Panel in relation to GST matters.

E11. Public rulings will not be referred to the Ministerial Council. However, the GST Administration Sub-Committee will refer a proposed GST change to the Ministerial Council for consideration if the Sub-Committee is of the view that the change could have a significant impact on GST revenues and so warrants Ministerial review.

E12. Draft legislation which might significantly affect the GST base will be forwarded through the GST Administrative Sub-Committee to the Ministerial Council for consideration.

APPENDIX F

GST ADMINISTRATION PERFORMANCE AGREEMENT—GUIDING PRINCIPLES

Preamble

Sch.

F1. This Appendix outlines the principles that will guide the subsequent development of a GST Administration Performance Agreement (the Performance Agreement) between the ATO and its agents, and the States and Territories (the Parties).

Objectives and Context of the Performance Agreement

F2. The purpose of the Performance Agreement is to provide accountability between the ATO and the States and Territories on behalf of whom the GST revenue is being collected. It also provides an agreed basis for the GST Administration Sub-Committee to monitor the administration of the GST by the ATO and its agents in return for the agreed GST administration costs being paid by the States and Territories.

F3. The Performance Agreement will reflect the commitment by the Parties to:

(i) achieving world’s best practice for GST administration in Australia;

(ii) a cost-effective and transparent GST administration; and

(iii) a cooperative relationship between the Parties.

F4. The Performance Agreement will recognise that achievement of world’s best practice GST administration, including cost-effectiveness, is dependent on the GST policy framework and integrated administrative design.

F5. The Performance Agreement will be consistent with the arrangements set out in this Intergovernmental Agreement.

Components of Agreement

F6. The Performance Agreement will include outcomes to be achieved, budgeting arrangements and monitoring and review arrangements for the purposes of maintaining accountability and transparency of operations.

The Performance Agreement will also include the process for raising matters of operational significance with the Ministerial Council.

Outcomes

F7. The Performance Agreement will stipulate performance outcomes and appropriate benchmarks to be achieved by the ATO. These outcomes may include, but are not limited to: revenue, taxpayer registration, compliance, reporting, education and legislative review. Consistent with the objectives of the Agreement, the benchmarks are to reflect world best practice in GST administration.

Cost of Administration

Sch.

F8. The Performance Agreement will outline the Commonwealth administration activities that are GST related for the purposes of agreeing the GST administration costs.

F9. The Performance Agreement will stipulate arrangements for an audit of GST costs and the systems for the control of GST costs.

F10. The Performance Agreement will outline the process and timing of consultation for developing/modifying budgets and business plans for GST administration. These budgets and business plans will be developed, and/or revised, in an appropriate and timely manner so as to broadly accord with Commonwealth arrangements for funding agency operations.

F11. The Performance Agreement will recognise that the States and Territories will fully compensate the Commonwealth for the agreed costs of administering the GST.

Monitoring and Review

F12. The Performance Agreement will stipulate the:

(i) number and timing of formal reports by the ATO to the Sub-Committee;

(ii) number and timing of progress reports by the ATO to the Sub-Committee; and

(iii) arrangements for special briefings on particular issues.

F13. The Parties to the Performance Agreement will ensure appropriate alignment of ATO Parliamentary reporting responsibilities and reporting responsibilities under the Performance Agreement.

Sch.

F14. The Performance Agreement will stipulate that ATO reports to the Sub-Committee on outcomes will include:

(i) updates on relevant internal governance arrangements, including appropriate strategic plans and annual and other relevant reports that scrutinise aspects of GST operations (including annual and other relevant reports from the Australian National Audit Office);

(ii) accrual-based financial reports;

(iii) key outcome performance indicators (including, registrations, revenue, refunds, costs, key processing workloads, Taxpayer Charter standards and international benchmark comparisons);

(iv) litigation and public ruling information;

(v) updates on relevant compliance and cost-of-compliance research;

(vi) administrative base issues; and

(vii) commentary on administrative performance and any key emerging GST compliance issues and related initiatives.

F15. The Performance Agreement will ensure that the States and Territories will have access to GST data held by the ATO subject to statutory limitations.

Matters of Operational Significance

F16. The Performance Agreement will outline arrangements for raising matters of operational significance with the Ministerial Council. Matters of operational significance may include disputes over the interpretation of the Performance Agreement and non-performance by the ATO against agreed targets. The Performance Agreement will ensure that the ATO will have the opportunity to provide direct advice to the Ministerial Council on any matters submitted to the Council.

Development of Agreement

Sch.

F17. The Performance Agreement will be developed by the GST Administration Sub-Committee and representatives of the ATO. The Performance Agreement is to be developed with reference to both:

(i) the guiding principles outlined in this Appendix; and

(ii) actual GST performance data (including revenue) in the Australian context, gathered during the transitional years.

F18. The Performance Agreement is to be finalised by the end of the GST transitional year ending June 2002. The Performance Agreement is to be endorsed by the Ministerial Council prior to being signed.

F19. The Performance Agreement will stipulate the process for its amendment.

Transitional Arrangements

F20. The ATO and the GST Administration Sub-Committee will discuss key operational issues and costs commencing in October 1999 and on a semiannual basis throughout the GST transitional year ending 30 June 2002.

F21. The ATO will arrange for an audit of the systems for the control of GST costs and the GST costs incurred during the period from 1 July 1999 to the date of the signing of the Performance Agreement by the Parties.

F22. The ATO will undertake to establish, by the end of the Transitional year ending 30 June 2002, final GST benchmarking arrangements with relevant overseas administrations, subject to their agreement. The ATO will discuss benchmarking plans with the GST Administration Sub-Committee.

Sch.

ENDNOTES

Endnotes

General Information

Minister's second reading speech—

Legislative Assembly: 2 March 2000

Legislative Council: 21 March 2000

The long title for the Bill for this Act was "to record the State's intention to give effect to the Intergovernmental Agreement on the Reform of Commonwealth–State Financial Relations and to enable State entities to make GST equivalent payments, to discontinue financial institutions duty and stamp duty on certain share transfers and on bookmakers' statements, to alter government fees and charges to take GST into account, to amend various Acts as a consequence of national taxation reform and for other purposes."

The National Taxation Reform (Consequential Provisions) Act 2000 was assented to on 11 April 2000 and came into operation as follows:

Section 31 on 17 February 1999: section 2(2); sections 1–16, 20–23, 25, 35, Schedule on 12 April 2000: section 2(1); sections 17–19, 24, 28–30, 32–34 on 1 July 2000: section 2(3); Part 8 (sections 26, 27) on 3 July 2000: section 2(4).

Table of Amendments

Endnotes

This Version incorporates amendments made to the National Taxation Reform (Consequential Provisions) Act 2000 by Acts and subordinate instruments.

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––

Statute Law Revision Act 2007, No. 28/2007

Assent Date:	26.6.07
Commencement Date:	S. 3(Sch. item 45) on 27.6.07: s. 2(1)
Current State:	This information relates only to the provision/s amending the National Taxation Reform (Consequential Provisions) Act 2000

State Taxation Acts Amendment Act 2012, No. 42/2012

Assent Date:	27.6.12
Commencement Date:	Ss 9. 10 on 1.7.12: s. 2(2)
Current State:	This information relates only to the provision/s amending the National Taxation Reform (Consequential Provisions) Act 2000

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––

Explanatory Details

Endnotes

No entries at date of publication.

1 National Taxation Reform (Consequential Provisions) Act 2000

Version No. 004

National Taxation Reform (Consequential Provisions) Act 2000

No. 6 of 2000

Version incorporating amendments as at
1 July 2012

table of provisions

Section Page

Part 1—Preliminary 1

1 Purposes 1

2 Commencement 1

3 Definitions 2

Part 2—Intergovernmental Agreement 4

4 Intergovernmental Agreement 4

Part 3—Payment of GST Equivalents by State Entities 5

5 Voluntary GST equivalent payments 5

6 Directions to State entities 5

part 4—Government Fees and Charges 7

7 Fees set by statutory rules may be increased 7

part 5–10—Repealed 8

8–35 Repealed 8

SCHEDULE—Intergovernmental Agreement on the Reform
of Commonwealth–State Financial Relations 9

ENDNOTES 37

General Information 37
Table of Amendments 38
Explanatory Details 39

Version No. 004

National Taxation Reform (Consequential Provisions) Act 2000

No. 6 of 2000

Version incorporating amendments as at
1 July 2012

The Parliament of Victoria enacts as follows:

Part 1—Preliminary

1 Purposes

The purposes of this Act are—

(a) to record the State's intention to give effect to the Intergovernmental Agreement on the Reform of Commonwealth–State Financial Relations;

(b) to enable State entities to make GST equivalent payments;

(d) to alter government fees and charges to take GST into account;

(e) to amend various Acts as a consequence of national taxation reform.

Key statutory concepts arise in the body of the Act and in the Schedule. They determine who may pay, who decides, how GST‑equivalent amounts are treated, and how Commonwealth-State institutional arrangements operate.

State entity (s 3): a person that “is not liable for GST that it would be liable for if (a) the imposition of that GST were not prevented by section 114 of the Commonwealth Constitution; and (b) section 5 of each of the GST Imposition Acts had not been enacted.” The definition ties the class of payers to the constitutional immunity provided by s 114 of the Commonwealth Constitution and to the structure of the Commonwealth GST imposition legislation.
Voluntary GST equivalent payments (s 5): State entities may pay amounts “representing amounts that would have been payable for GST” and do “things of a kind ... necessary or expedient” if they were liable. This is expressed as a permissive power (“may pay”) rather than a tax liability. The section was later amended to expressly permit payment of amounts representing penalties and interest that would have applied if the GST law had applied (s 5(2); definition of “interest” and “penalties” inserted in s 3 by No. 42/2012).
Treasurer’s directions (s 6): the Treasurer may direct a State entity in writing to make the payments or perform authorised actions, may amend or revoke directions, may give directions with retrospective effect, and the directions override any other written law (s 6(1)-(4)). This creates a centralised administrative power to implement the voluntary payments regime.
Fee adjustments (s 7): Governor in Council may, on Minister recommendation, make regulations increasing fees set by statutory rule by an amount or percentage specified, subject to constraints: increase cannot exceed the GST payable on the supply except as provided by s 7(6); the Minister’s recommendation must be founded on a considered necessity to cover increased costs resulting from GST implementation (s 7(3)); Part 2 of the Subordinate Legislation Act does not apply to these regulations (s 7(4)); a fee may be increased only once (s 7(5)); and special temporal rules determine how a fee is taken to relate to supplies made on or after 1 July 2000 and that increases do not apply to parts of supplies for periods before that date (s 7(6)-(7)).
Agreement and institutional architecture (Schedule): the Schedule reproduces the Intergovernmental Agreement on Reform of Commonwealth-State Financial Relations, which contains objectives, measures to abolish certain State taxes (Appendix A), mechanics for GST revenues (Appendix B), transitional arrangements and the Guaranteed Minimum Amount (Appendix C), the First Home Owners Scheme (Appendix D), the ATO’s administrative role and consultation processes (Appendix E), and a Performance Agreement framework for ATO administration costs (Appendix F). It establishes a Ministerial Council (clauses 40-46) and a GST Administration Sub‑Committee (clause 46) as continuing governance bodies with complaints, review, and recommendation functions.
Interaction with federal law (throughout): the Act repeatedly cross‑refers to Commonwealth GST legislation and to the Commonwealth Commissioner of Taxation (s 3 definitions), to the GST Imposition Acts, and to the Taxation Administration Act 1953 (re penalties and interest). The Schedule contemplates Commonwealth legislation to direct withholding of local government payments and to distribute GST revenue grants (Schedule clauses 7, 18, Appendix B).

These concepts allocate decision rights: Treasurer directions decide whether and when a State entity must pay (s 6); the Minister and Governor in Council decide fee increases (s 7); the Commissioner of Taxation receives voluntary payments (s 5); the Ministerial Council and Sub‑Committee are the forums for interjurisdictional review and oversight (Schedule clauses 40-46; Appendix E). The Agreement also specifies principles that govern the GST rate and base (clauses 31-36), notably requiring unanimity of States/Territories to vary the rate (clause 31) and imposing procedural requirements for changes to the base and administrative variations (clauses 32-36; Appendix E).

The Act affects multiple institutional and private actors in concrete ways. Identify who pays, who decides, who administers and who bears indirect costs.

State entities (primary payers): defined in s 3 as those not liable for GST solely because of constitutional protection under s 114 (Commonwealth Constitution) and because s 5 of the GST Imposition Acts was not enacted. These bodies include State instrumentalities, statutory corporations and agencies that would otherwise be within the GST net but for constitutional and imposition exclusions. The Act authorises them to make voluntary GST‑equivalent payments to the Commissioner of Taxation (s 5). The Treasurer may direct such an entity to make payments (s 6), converting permissive authority into an administrative obligation where a direction is given.
Treasurer and Minister (decision‑makers): the Treasurer has power to direct State entities to make payments or perform other actions under s 6, and the Treasurer can amend or revoke those directions (s 6(2)). The Minister (unnamed portfolio in the Act, but the Minister making recommendations under s 7) recommends to the Governor in Council whether statutory fees should be adjusted to incorporate GST. The Governor in Council makes the regulation (s 7(1)).
Governor in Council: exercises subordinate legislative power to increase specified statutory fees by regulation on the Minister’s recommendation, subject to the caps and conditions in s 7.
Commissioner of Taxation (Commonwealth): the recipient of voluntary GST‑equivalent payments (s 5); the Schedule identifies the Commissioner and the Australian Taxation Office as the administrative authority for the GST (Schedule Appendix E, clause E1). Appendix B tasks the Commissioner with determining total GST revenues for distribution purposes (Appendix B3-B4).
Commonwealth Government and ATO administration: Schedule clauses 37-39 and Appendices E and F require States to compensate the Commonwealth for agreed ATO administrative costs and describe performance/monitoring arrangements between ATO and States; the ATO is to compensate, report and co‑operate with States in the GST Administration Sub‑Committee (Appendix F, F8-F15).
Local government: Schedule clause 18 contemplates Commonwealth legislation requiring States to withhold sums from local government authorities that are in breach of clause 17 (i.e. not operating as if subject to GST). Those withheld amounts are to form part of the GST revenue pool. This affects local councils and their financial flows where the Commonwealth withholds.
Private businesses and consumers (indirectly): fee increases permitted by s 7 allow fees set by statutory rule to be increased up to the GST payable on the underlying supply. Where fees are increased, private parties who consume the services or supplies will face higher user charges to the extent State statutory fees are adjusted. Schedule clauses 28-29 require monitoring of prices by the ACCC (and extension of certain Trade Practices Act provisions) to detect unreasonable pricing decisions during the transition (Schedule, clauses 28-29).
Courts and administrative reviewers: the Treasurer’s direction power (s 6) is stated to be effective “despite any other written law” (s 6(4)). That creates potential administrative law questions (judicial review, interpretation), and interaction with regulations made under s 7 (which are exempt from Part 2 of the Subordinate Legislation Act 1994) reduces the usual procedural oversight available under subordinate legislation rules.

The Schedule’s institutional machinery affects officials across Commonwealth, State and Territory treasuries and ministers. The Ministerial Council and GST Administration Sub‑Committee are decision forums affecting policy on rates, base, monitoring, and ATO performance (Schedule clauses 40-46; Appendix E). The transitional arrangements (Appendix C) and Guaranteed Minimum Amount processes set out specific reporting and payment timetables that affect Heads of Treasuries and the Commonwealth Treasurer (Appendix C3-C8).

In short, the Act primarily changes the choices and duties of State entities and State financial decision‑makers, allocates administrative responsibilities to the ATO and Commonwealth Treasurer, and creates mechanisms that can pass costs to users via regulated fee increases.

The Act creates a set of statutory authorities, duties and rights distributed among State entities, the Treasurer, the Minister, the Governor in Council and the Commissioner of Taxation. The main duties and rights, with statutory citations, are:

Rights and permissive powers

Right to make voluntary payments (State entities): s 5(1) provides that a State entity “may pay to the Commissioner of Taxation amounts representing amounts that would have been payable for GST” and “may do things of a kind that it would be necessary or expedient for it to do if it were liable for that GST.” This is formulated as an enabling power rather than a compulsion.
Right to pay penalties and interest amounts (State entities): s 5(2) (inserted by later amendment) expressly authorises State entities to pay amounts representing penalties and interest that would have been payable if GST law applied, subject to the same constitutional caveat referenced in s 5(1).

Duties and directive powers

Treasurer’s direction power (s 6): the Treasurer may give written directions to a State entity to require it to make payments it is authorised by s 5 to make or to do anything else authorised by s 5(1). The Treasurer may amend or revoke a prior direction (s 6(2)). Directions may relate to past events (s 6(3)). Crucially, a State entity “is to comply with directions under this section despite any other written law” (s 6(4)). The net effect is that the Treasurer can convert the permissive power in s 5 into an enforceable administrative obligation by issuing a written direction.
Regulation‑making and fee adjustment (s 7): on Minister recommendation, the Governor in Council may make regulations increasing statutory fees or charges by an amount or percentage specified in the regulation (s 7(1)). The Minister may recommend only if he or she considers the increase necessary to cover increased costs attributable to implementation of the GST, the GST Imposition Acts and the Intergovernmental Agreement (s 7(3)). The regulation must observe the cap that the increase “cannot exceed the amount of GST payable on the supply to which the fee or charge relates” except as provided by s 7(6) (s 7(2)).
Limits and procedural rules on fee increases (s 7): increases may be made only once per fee (s 7(5)); Part 2 of the Subordinate Legislation Act 1994 does not apply to these regulations (s 7(4)); and special temporal rules instruct how the GST payable is to be calculated in relation to supplies made wholly on or after 1 July 2000 and prohibit increases for the portion of supplies attributable to the period before 1 July 2000 (s 7(6)-(7)). The Act also defines GST in s 7 to include notional GST for which State entities may make payments under Part 3.
Institutional duties in the Schedule: the Agreement imposes multiple administrative and reporting duties on the Commonwealth and the States. Examples include the requirement that the Commonwealth will “make GST revenue grants to the States and Territories equivalent to the revenue from the GST” (Schedule, clause 7), the creation of Ministerial Council and GST Administration Sub‑Committee with specified functions (Schedule, clauses 40-46), ATO compensation and reporting obligations (Schedule, clauses 37-39; Appendix E and F), and the Guaranteed Minimum Amount processes with strict reporting and payment timetables (Appendix C).

Administrative rights and oversight limitations

ATO administration: Appendix E recognises the Commissioner of Taxation’s general administration of the GST law (E1) and requires consultation on public rulings and ATO performance monitoring by the Sub‑Committee (E10-E11).
Reduction of ordinary subordinate legislation oversight: s 7(4) expressly excludes Part 2 of the Subordinate Legislation Act 1994 from applying to regulations under s 7. That reduces the usual procedural or parliamentary scrutiny that would accompany subordinate legislation of this type, at least as to procedural requirements captured by Part 2.

Areas without specific statutory duties

The Act does not create criminal offences or specific penalty clauses for failure by a State entity to make voluntary payments absent a Treasurer direction, nor does it specify enforcement sanctions in s 6 for non‑compliance beyond the statutory statement that a State entity is to comply with directions despite other written law (s 6(4)). Liability for penalties and interest exists only in a notional sense where s 5(2) authorises payment of amounts representing those penalties and interest that would otherwise arise under the Taxation Administration Act if the GST law applied.

To sum up, the Act grants State entities an express right to make GST‑equivalent payments, gives powerful direction and override authority to the Treasurer, permits fee increases limited to the GST quantum and creates institutional duties and reporting obligations through the Agreement imposed on the Commonwealth and States regarding revenue distribution, transitional assistance and ATO administration.

The Act itself contains limited direct penalty or criminal enforcement provisions. It instead establishes administrative mechanisms and cross‑references to Commonwealth tax enforcement regimes where they become relevant to notional payments. Key points:

No express new criminal offences in the Act: the National Taxation Reform (Consequential Provisions) Act 2000 does not create standalone criminal penalties or specify pecuniary penalties against State entities within its body. Compliance mechanics are primarily administrative,directions, payments and regulatory instruments.
Penalties and interest referenced as notional amounts (s 5(2); s 3 definitions): the Act was amended to permit State entities to pay to the Commissioner “amounts representing amounts that would have been payable as penalties or interest” in respect of amounts paid under s 5(1) (s 5(2)). The Act defines “interest” and “penalties” by reference to the Taxation Administration Act 1953 (see s 3 definitions). Those penalties are therefore part of the Commonwealth taxation enforcement framework and would be enforced by the ATO in the context of GST law were GST law to apply to the State entity; the Act merely permits voluntary alignment with those payment obligations.
Treasurer directions and their compulsion (s 6): s 6(1) empowers the Treasurer to give written directions to State entities requiring payments and authorised actions; s 6(4) requires State entities to comply with such directions “despite any other written law.” The Act does not set out criminal penalties for refusing a direction, but the statutory compulsion plus the express override of other written law gives an administrative enforcement posture: a direction creates a statutory obligation enforceable by the State’s internal administrative mechanisms, and non‑compliance could give rise to legal remedies or internal disciplinary consequences. The Act does not specify processes for enforcement of s 6 directions in courts or tribunals.
Withholding by Commonwealth (Schedule clause 18): the Agreement contemplates that the Commonwealth will legislate to require States and the Northern Territory to withhold, from any local government authority being in breach of clause 17, sums representing unpaid voluntary or notional GST payments. Those withheld amounts will “form part of the GST revenue pool.” That withholding is a specified enforcement tool against local government non‑compliance conceived at the intergovernmental level and requires Commonwealth implementing legislation.
ATO administration and audit/compensation monitoring (Appendix F): the ATO’s performance and cost recovery are subject to a Performance Agreement to be developed with States and Territories (Appendix F). That agreement will provide for monitoring, reporting, audits and benchmarking of ATO GST administration costs (F8-F15). The ATO is the administrative agent for any amounts actually collected and will be subject to the monitoring and reporting requirements set out in the Performance Agreement and Appendices.
Price monitoring by ACCC and extended Trade Practices Act measures (Schedule clauses 28-29): the Agreement requires formal monitoring of prices under the Trade Practices Act 1974 (as amended) and contemplates expanding the jurisdictional reach of Part VB of that Act to cover areas outside Commonwealth constitutional power, to monitor and take action against unreasonable pricing decisions during the transition period (Schedule clauses 28-29). Those measures can lead to enforcement actions against businesses under Commonwealth competition and consumer law regimes.
Practical enforcement lacunae and administrative risk: because the Act permits voluntary payments but imposes compulsion via Treasurer directions, enforcement is effectively administrative rather than criminal. The Act supplies no explicit statutory penalty attaching to a State entity’s failure to obey a Treasurer direction, but directions override other law and non‑compliance would expose the State entity to administrative consequences. The actual coercive measures available would therefore likely be internal or rely on the Commonwealth’s withholding powers set out in the Agreement (subject to separate legislation).

In practical terms, the enforcement architecture mixes administrative compulsion (Treasurer directions), Commonwealth withholding powers in the Agreement, and the ATO’s existing tax enforcement mechanisms to the extent amounts are treated as GST revenue. The Act itself defers to the Commonwealth’s Taxation Administration Act for the content of interest and penalties that may be reflected in voluntary payments (see s 3).

The Act repeatedly cross‑references Commonwealth GST legislation and other statutory instruments, and it modifies ordinary subordinate legislation oversight for specific fee adjustments. The principal interactions are:

Relationship with the Commonwealth GST law and imposition acts: s 3 defines “GST” and “GST law” by reference to the A New Tax System (Goods and Services Tax) Act 1999 (Commonwealth) and identifies the GST Imposition Acts (A New Tax System (Goods and Services Tax Imposition,Customs) Act 1999; ...,Excise; ...,General). The Act explicitly frames State entities as those not liable for GST because of constitutional protection in s 114 and because of s 5 of the GST Imposition Acts not being enacted. The voluntary payment mechanism in s 5 is constructed precisely to operate in the constitutional context created by those Commonwealth laws.
Reference to the Taxation Administration Act 1953 (Cth): s 3 defines “interest” and “penalties” as those under the Taxation Administration Act 1953 (Cth), and s 5(2) allows State entities to pay amounts representing such interest and penalties. Therefore, the content and incidence of interest and penalties are determined by federal taxation law even though the payments are made voluntarily by State entities under the Victorian Act.
Fee regulation and exclusion of usual subordinate legislation processes: s 7 permits the Governor in Council to make regulations increasing specified fees and expressly excludes Part 2 of the Subordinate Legislation Act 1994 from applying to those regulations (s 7(4)). That reduces the usual procedural scrutiny and parliamentary oversight that might otherwise apply to subordinate instruments increasing fees. The Act also caps increases to the GST payable on the relevant supply and permits increases only once (s 7(2), (5)).
The Agreement’s interaction with Commonwealth legislation and institutions: the Schedule anticipates Commonwealth legislation as necessary for parts of the architecture. For example, Schedule clause 4 directs the Commonwealth to attach the Agreement as a schedule to the A New Tax System (Commonwealth-State Financial Arrangements) Act 1999, and clause 18 anticipates Commonwealth legislation to authorise withholding from local government. Appendix E and F contemplate ATO administration and a Performance Agreement that links Commonwealth administrative duties and State cost recovery.
Horizontal fiscal equalisation and Commonwealth Grants Commission processes: Appendix B requires GST revenue grants to be distributed in accordance with horizontal fiscal equalisation (HFE) principles and contemplates the Commonwealth Treasurer determining per capita relativities after consulting with the States and Territories. This ties Victorian fiscal arrangements into Commonwealth processes administered under other federal statutes and the Commonwealth Grants Commission methodology.
Interaction with competition law and price monitoring: Schedule clauses 28-29 require price monitoring under the Trade Practices Act 1974 (Commonwealth) and envisage extending particular price‑monitoring measures to areas outside Commonwealth power by States adopting a Schedule version of Part VB. Implementation requires interaction between state statutes and Commonwealth competition law.
Constitutional reference (s 114): the Act’s core premise for authorising voluntary payments is the constitutional distinction in s 114 of the Commonwealth Constitution, which prevents the Commonwealth from imposing taxes on State property and is invoked in the s 3 definition of “State entity.” The Act thus sits at the interface between State legislative competence and Commonwealth taxation powers.
Administrative law overlay: s 6(4) states that State entities must comply with Treasurer directions “despite any other written law.” This creates a statutory override of other written law at the State level, which may raise administrative law questions about legality, scope and reviewability of directions, and about whether an administrative direction can validly displace other legal duties under State law.
Repeals and statute law revision: Parts 5-10 and ss 8-35 were repealed by the Statute Law Revision Act 2007 (No. 28/2007) (Endnotes). The State Taxation Acts Amendment Act 2012 (No. 42/2012) inserted definitions and amended s 5. These amendments change how the Act refers to penalties and interest and how State entities may make payments (see Endnotes).

Practically, the Act is intended to operate in tandem with Commonwealth GST legislation and the Taxation Administration Act, to use the ATO and the Commissioner as collection and administrative agents, and to channel intergovernmental revenue and institutional oversight via the Ministerial Council and GST Administration Sub‑Committee. For regulated fee increases it removes certain subordinate legislation transparency requirements and anchors any fee increase rationale to GST‑related cost increases.

The Act as presented contains a record of later statutory amendments and a statute law revision. The endnotes set out the principal formal amendments to the National Taxation Reform (Consequential Provisions) Act 2000 that are reflected in this consolidated text:

Statute Law Revision Act 2007 (No. 28/2007): this amending Act repealed Parts 5-10 and ss 8-35 of the National Taxation Reform (Consequential Provisions) Act 2000. The Endnotes record that the repeal commenced 27 June 2007 (s 3(Sch. item 45) on 27.6.07). The consolidated text notes “Pts 5-10 (Headings and ss 8-35) repealed by No. 28/2007 s 3(Sch. item 45).” Those repeals removed provisions that previously occupied those parts; the effect was to narrow the Act’s operational scope to the remaining Parts (Preliminary; Intergovernmental Agreement; Payment of GST Equivalents by State Entities; Government Fees and Charges).
State Taxation Acts Amendment Act 2012 (No. 42/2012): the endnotes record assent on 27 June 2012 and commencement of ss 9 and 10 on 1 July 2012. The consolidated text indicates that several definitions were inserted by No. 42/2012 s 9 (including definitions of “GST law”, “interest”, and “penalties”) and that s 5 was amended by No. 42/2012 s 10 (noting the insertion s 5(2)). The in‑text annotations read: “S. 3 def. of GST law inserted by No. 42/2012 s. 9”, “S. 3 def. of interest inserted by No. 42/2012 s. 9”, “S. 3 def. of penalties inserted by No. 42/2012 s. 9”, and “S. 5 amended by No. 42/2012 s. 10 (ILA s. 39B(1)).” These amendments made explicit that State entities may pay amounts representing penalties and interest that would otherwise be payable under Commonwealth taxation law if GST law applied.
Original commencement and operation: the Endnotes reproduce the legislative history of commencement. The Act was assented to on 11 April 2000. Section 2 sets staggered commencement dates: most of the Act came into operation on the day after Royal Assent (s 2(1)); s 31 is deemed to have commenced on 17 February 1999 (s 2(2)); remaining provisions of Part 9 and specified sections came into operation on 1 July 2000 (s 2(3)); Part 8 came into operation on 3 July 2000 (s 2(4)). The Endnotes’ “Minister’s second reading speech” material restates the Bill’s long title and the commencement particulars set out above.
Schedule unchanged in form: the Schedule reproduces the Intergovernmental Agreement (signed June 1999) and includes Appendices A-F. The Endnotes do not record amendments to the Schedule within this consolidated Act, although the Schedule itself contemplates future changes to GST law and the Agreement to be revisited should Commonwealth Parliament pass GST legislation materially different from the Agreement (Schedule clause 6).
Cross‑references to Commonwealth Acts remain relevant: the consolidated text incorporates references to Commonwealth GST statutes, the Taxation Administration Act 1953 (Cth), the Trade Practices Act 1974 (Cth), and other Commonwealth instruments specified in the Schedule. Those cross‑references remain operative unless amended by other Victorian or Commonwealth legislation.

The amendment history in the Endnotes is concise: it documents the 2007 statute law revision repeal items and the 2012 State Taxation Acts Amendment Act insertions and amendments. Users should consult Victoria’s consolidated statute register and the Commonwealth statute register if they need to trace any further amendments affecting cross‑referenced Commonwealth laws or the Agreement’s commitments that require Commonwealth implementing legislation.

The Act and its Schedule do not themselves record any judicial decisions or litigation. The consolidated text and the Endnotes do not name cases or report judgments. Therefore there is no litigation history recorded in the instrument provided. Two implications follow from that absence, both grounded in the Act’s text and institutional choices:

Absence of litigated precedent in the Act: because no cases or disputes are recorded in the Act or Schedule, practitioners must assume that the text stands as the prima facie source of law for the mechanics contemplated. Any legal disputes arising from the Act will therefore be litigated under general principles of administrative and constitutional law, tax law and statute interpretation rather than under specific precedents recorded in the instrument.
Predictable dispute areas (based on statutory design): the structure of the Act itself identifies areas where litigation or administrative review would be most plausible. These arise from the Act’s cross‑jurisdictional and administrative features:
- Treasurer directions (s 6): directions that override “any other written law” (s 6(4)) could be challenged by a State entity or other affected party on administrative law grounds (e.g. ultra vires, procedural fairness), or on constitutional grounds (if directions interfere with entrenched legal rights), particularly where a direction purports to require acts incompatible with established statutory obligations. The Act does not specify enforcement penalties for non‑compliance, which may give rise to legal disputes over the legal remedies available to enforce or challenge a direction.
- Fee increase regulations (s 7): because s 7(4) excludes Part 2 of the Subordinate Legislation Act 1994, there is a reduced procedural basis for challenge under those subordinate legislation processes. Still, affected parties may seek judicial review of the legality of a regulation under standard statutory interpretation principles or constitutional limitations (e.g. whether the regulation respects the cap in s 7(2) or the Minister’s required consideration under s 7(3)).
- Intergovernmental obligations and Commonwealth implementing legislation: Schedule provisions often contemplate or require complementary Commonwealth legislation (e.g. clause 4; clause 18). Disputes may arise where Commonwealth implementing legislation departs materially from Agreement expectations (see Schedule clause 6 requiring reconsideration if Commonwealth Parliament passes GST legislation that significantly affects the Agreement). Litigation could focus on whether Commonwealth action sufficiently implements the Agreement or breaches its undertakings to the States.
- ATO administration, cost recovery and performance: Appendices E and F allocate duties to the ATO and provide for Performance Agreement monitoring and audits. Legal disputes could arise over the reasonableness of ATO cost allocations to the States, access to GST data (F15) and compliance with the Performance Agreement.
- Constitutional challenges: the Act’s operation is premised on constitutional exclusions under s 114 of the Commonwealth Constitution. Litigation may arise if a question emerges about whether a particular body qualifies as a “State entity” under s 3 or about the constitutionality of related Commonwealth measures (withholding powers, revenue distributions).

Because the Act contains no recorded litigation, any court decisions touching these statutory features will need to be located by searching judicial databases and later legislative updates. Legal advisers should not assume settled case law from the presence of the Act; instead, they should analyse these statutory touchpoints as potential litigation vectors, noting that the Act defers to Commonwealth tax enforcement (Taxation Administration Act) and places responsibilities in intergovernmental forums that are designed to reduce but not eliminate legal contestation.

Practitioners should note a set of practical and legal pitfalls grounded in the text. These are not value judgements; they are concrete mechanics and foreseeable friction points.

“Voluntary” yet enforceable: s 5 frames payments as permissive (“may pay”) but s 6 allows the Treasurer to give written directions requiring State entities to make payments or act in ways that would be “necessary or expedient” if they were GST‑liable (s 6(1)). A direction overrides “any other written law” (s 6(4)). Practically, an entity that assumes payments are purely voluntary may be surprised when a Treasurer direction converts the permissive statutory authority into a binding obligation.
Retrospective directions permitted (s 6(3)): the Treasurer can give directions that relate to actions undertaken before the direction was issued. That increases the scope of financial exposure for State entities and may complicate budgeting and audit because liabilities can be made to attach after the fact.
Fee increases: single opportunity and limited scrutiny (s 7):
- A statutory fee or charge may be increased only once under s 7(5). That makes timing and quantum decisions final in regulatory terms; a mistaken or overreaching increase cannot be repeated under the same statutory mechanism.
- Part 2 of the Subordinate Legislation Act 1994 does not apply (s 7(4)). The usual procedural transparency and review mechanisms for subordinate instruments are therefore not available for these fee increases; stakeholders and lawyers cannot rely on that procedural avenue to challenge or scrutinise the regulation.
Complex temporal treatment of supplies (s 7(6)-(7)): in calculating the GST payable for the purposes of fee increases, the fee or charge “is to be taken to be payable in relation to supplies made wholly on or after 1 July 2000” (s 7(6)). Yet s 7(7) prevents the increase from applying to that part of a supply in respect of a period before 1 July 2000. Multi‑period supplies therefore require careful apportionment. Administrative errors in apportionment could result in overcharging or undercharging and create disputes.
Definition of State entity tied to constitutional s 114 (s 3): the class of entities permitted or required to make payments is defined by reference to a constitutional exclusion, which itself is a legal concept that can be contested in application. The Act provides no single list of covered bodies; determining whether an entity qualifies as a “State entity” will require legal analysis of the constitutional contours and of whether s 5 of the GST Imposition Acts would have applied.
Notional payments of penalties and interest: s 5(2) and the s 3 definitions permit State entities to pay amounts representing penalties and interest that would otherwise be payable under the Taxation Administration Act if the GST law applied. Those penalties are determined by Commonwealth law and can therefore be substantial; paying them voluntarily or under Treasurer direction may expose State entities to tax‑administration mechanics that are unfamiliar to State accounting frameworks.
Delegation and internal controls: the Treasurer can amend or revoke directions (s 6(2)). Where Treasurer directions are used operationally, agencies must ensure internal delegation instruments, approvals and audit trails are in place; otherwise, liability timing and authorisation will be contested.
Minister’s subjective consideration under s 7(3): the Minister may recommend a fee increase only if he or she “considers” that it is necessary to cover increased costs resulting from GST implementation. That subjective threshold could be litigated where third parties claim the Minister failed to properly consider alternative cost‑recovery methods or that the increase does not reflect GST‑related cost changes.
Invisible federal linkages: the Schedule contemplates numerous Commonwealth legislative and administrative actions (e.g. clause 18 withholding, clause 7 GST revenue grants). The Act’s practical effects therefore depend on complementary Commonwealth steps and ATO cooperation. States and local governments could be exposed to contingent liabilities that hinge on intergovernmental decisions outside Victorian statutory control.
Price monitoring window and obligations: Schedule clauses 28-29 establish ACCC monitoring and extend price‑monitoring measures to cover areas outside Commonwealth power by adopting Schedule version of Part VB. Businesses and compliance officers should note the transition period (1 July 1999 to 30 June 2002 in the Agreement) and the possibility of ACCC scrutiny of pricing decisions during that period; although the formal date in the Agreement is historical, the structural mechanism is present.
Administrative cost allocation to States (Appendix F): the Performance Agreement contemplates that States will fully compensate the Commonwealth for agreed ATO costs for GST administration (Appendix F8-F11). States should scrutinise cost allocation methodologies, audit rights and benchmarking provisions (Appendix F20-F22) to avoid unexpected recurrent charges.

These are concrete operational and legal risks that the Act’s drafting produces. Addressing them requires careful governance, clear internal authorisations, apportionment methodologies for multi‑period supplies, scrutiny of any Treasurer directions before compliance, and a robust approach to intergovernmental data and cost auditing.

This section sets out a practicable compliance checklist for State entities, departments, ministers and regulated fee administrators arising from the Act and the Agreement. It is grounded in statutory text; follow the steps and record the supporting legal authority.

For State entities (when considering voluntary GST‑equivalent payments or responding to Treasurer directions)

Establish whether the entity qualifies as a “State entity” under s 3.
- Analyse whether the entity is not liable for GST only because of s 114 of the Commonwealth Constitution and the absence of s 5 of the GST Imposition Acts. Document the legal basis for inclusion.
Internal approval and delegation.
- Ensure an appropriate internal authorisation framework exists that authorises payment of voluntary amounts and acceptance of Treasurer directions. Record delegations, approvals and responsible officers.
Calculate the notional GST, penalties and interest.
- If opting to make payments under s 5(1) or (2), calculate the GST equivalent and any amounts representing penalties or interest “that would otherwise be payable” under the Taxation Administration Act 1953 (s 5(2); s 3 definitions). Maintain records sufficient to support amounts paid and to reconcile with ATO records.
Expect possible Treasurer direction and compliance obligation.
- Recognise that the Treasurer’s direction (s 6(1)) can convert permissive authority into an obligation, including directions with retrospective effect (s 6(3)). Plan for budgetary contingencies and internal compliance checks.
Record and report.
- Keep full records of calculations, instructions, Treasurer directions, and correspondence with the Commissioner of Taxation. The Schedule anticipates ATO reporting and State access to GST data (Appendix F15); ensure systems can produce the required data.
Engage with the ATO and the GST Administration Sub‑Committee where relevant.
- If ATO processes are implicated (refunds, input tax credit treatments in notional terms), coordinate through Treasury and the Sub‑Committee structures established in the Agreement (Schedule clauses 46 and Appendix E).

For Ministers, Treasurer and Governor in Council (fee adjustments and directions)

Ministerial decision to recommend fee increase (s 7):
- Before recommending a regulation to increase a statutory fee, prepare a written reasoning that the increase is “necessary to cover the increased cost of the supply ... as a result of the implementation” of the ANTS GST Act, the GST Imposition Acts and the Intergovernmental Agreement (s 7(3)). Document the cost drivers and the link to GST.
Ensure the increase does not exceed the GST payable on the supply (s 7(2)):
- Determine the GST payable on the relevant supply, applying s 7(6) and (7) to apportion multi‑period supplies and to treat the fee as relating to supplies made wholly on or after 1 July 2000 where applicable.
One‑time adjustment rule (s 7(5)):
- Recognise that the increase under s 7 may be applied only once to a given fee. Ensure the quantum is final and communicated to affected stakeholders; build this into public consultation and budget processes despite the exclusion of Part 2 Subordinate Legislation Act for procedural compliance (s 7(4)).
Make the regulation via Governor in Council and record rationale.
- Although Part 2 of the Subordinate Legislation Act does not apply (s 7(4)), keep the policy and consultation materials, economic impact analyses and Ministerial recommendations on file for accountability and possible judicial review.
Coordinate with Commonwealth ATO and Ministerial Council:
- Fee changes and State payments interact with Commonwealth revenue pooling and ATO administration (Schedule, App B; App E and F). Provide requisite notices to the Ministerial Council where changes may impact GST base or revenues.

For Heads of Treasuries and agencies implementing Schedule mechanics (transitional arrangements, Guaranteed Minimum Amount)

Follow the reporting timetable in Appendix C:
- Heads of Treasuries are to provide advice to the Ministerial Council on specified dates (Appendix C4,by 1 March 2000, 1 November 2000, 1 September and 1 March in subsequent years, and 1 June for Guaranteed Minimum Amount). Ensure your agency can supply the prescribed estimates and adjustments.
Implement Guaranteed Minimum Amount calculations per Appendix C:
- Use the methodology agreed by Heads of Treasuries for components of the Guaranteed Minimum Amount (Appendix C8). Maintain spreadsheets and audit trails mapping State revenue replacements, reduced expenditures and growth dividend adjustments.
Manage transitional payments and loan procedures:
- The Commonwealth may provide assistance as grants or interest‑free loans depending on year (Appendix C1). Ensure coordination for loan repayment schedules (Appendix C7) and the Commonwealth’s schedule of quarterly payments (Appendix C5).

For compliance officers and lawyers advising affected private parties

Assess impact of fee increases:
- Where a statutory fee is subject to s 7 regulations, advise clients on the new fee quantum, the effective date and apportionment rules for supplies spanning 1 July 2000 (s 7(6)-(7)).
Monitor ACCC price monitoring obligations and risk profiles:
- The Schedule anticipates ACCC monitoring (Schedule clauses 28-29). Advise clients to retain documentary evidence of price setting and cost pass‑through calculations during the transition to show consistency with tax reform rather than opportunistic pricing.
Anticipate ATO interaction in practice:
- If a State entity pays notional GST and penalties to the ATO, private businesses that contract with that State entity may see changes in invoicing, procurement accounting and input tax credit approaches. Coordinate with accounting teams to manage GST reporting and to reconcile any notional input tax credits where permitted by the Agreement and ATO guidance.

Recordkeeping, audit and transparency

Log Treasurer directions and related approvals (s 6), maintain calculation worksheets for notional GST and penalty amounts, preserve Ministerial recommendation documentation for fee increases, and retain correspondence with ATO and Commonwealth officials as the Schedule contemplates ongoing monitoring and auditing (Appendix F8-F15).
Where the Performance Agreement (Appendix F) applies, participate in the agreed audits and benchmarking exercises and preserve documentation that supports the allocation of ATO administration costs.

Finally, when in doubt about constitutional or interjurisdictional coverage of a particular entity, treat the qualification as a legal question requiring opinion. The Act ties the entitlement and obligations to constitutional and Commonwealth statutory constructs; do not assume automatic applicability.

National Taxation Reform (Consequential Provisions) Act 2000

Plain English Summary

Deep Dive

What it does

Current sections

National Taxation Reform (Consequential Provisions) Act 2000

Source text: opening excerpt

1 National Taxation Reform (Consequential Provisions) Act 2000

Main concepts

Who it affects

Key duties and rights

Penalties and enforcement

How it interacts with other laws

Amendment history

Litigation history

Gotchas

How to comply