❓ The WA government is amending the Stamp Act to close loopholes that allow large companies to avoid stamp duty on property transactions, costing the state millions. The changes will be retrospective to prevent further avoidance.
AnsweredQoN 34Legislative Assembly
QuestionView source ↗
Could the minister inform the House of any changes to be made to stamp duty that would make the system fairer? Mr KIERATH
AnswerView source ↗
It has come to the attention of the Government that an inequitable situation exists within the taxation system that threatens to severely penalise the State. This inequity allows large companies to pay just $1 in stamp duty on property transactions worth millions of dollars while the average family is required to pay about $5 000 in stamp duty on its home. Last year, the stamp duty avoidance measures adopted by some companies cost the taxpayers of Western Australia $35m, and the State Revenue Department is investigating seven more cases that could amount to a further $37m loss. These are significant amounts of money that are being denied to the people of Western Australia. These funds could be used to further enhance the good work of this Government since it came to power in building three new hospitals and 27 police stations. This tax avoidance was possible because companies took advantage of the different ways shares and property are treated for the purposes of determining stamp duty liability. Stamp duty on property is charged at $4.85 for each $100 of value whereas stamp duty on company shares is charged at between 15¢ and 60¢ for each $100, depending on the type of company involved. Further, the duty on company shares is based only on the value of the company; that is, the gross value of assets less liabilities. Subsequently, entities have been able to package their assets into companies and sell them as shares rather than as property assets. It is simply not fair that Western Australian families accept their stamp duty obligations on their homes while some large companies avoid the taxation responsibilities intended by Government. Therefore, a number of changes will be made to the Stamp Act that, subject to the passage of legislation, will be effective from today. These changes address the known avoidance practices and are detailed in the document, “Stamp Act Amendments - Anti-Avoidance Provisions”, which I now table. The Government decided to make the legislation closing these avoidance options retrospective to prevent any party taking advantage of the delay between the changes to the Stamp Act and today’s announcement. [See paper No 111.]
Mr KIERATH replied: It has come to the attention of the Government that an inequitable situation exists within the taxation system that threatens to severely penalise the State. This inequity allows large companies to pay just $1 in stamp duty on property transactions worth millions of dollars while the average family is required to pay about $5 000 in stamp duty on its home. Last year, the stamp duty avoidance measures adopted by some companies cost the taxpayers of Western Australia $35m, and the State Revenue Department is investigating seven more cases that could amount to a further $37m loss. These are significant amounts of money that are being denied to the people of Western Australia. These funds could be used to further enhance the good work of this Government since it came to power in building three new hospitals and 27 police stations. This tax avoidance was possible because companies took advantage of the different ways shares and property are treated for the purposes of determining stamp duty liability. Stamp duty on property is charged at $4.85 for each $100 of value whereas stamp duty on company shares is charged at between 15¢ and 60¢ for each $100, depending on the type of company involved. Further, the duty on company shares is based only on the value of the company; that is, the gross value of assets less liabilities. Subsequently, entities have been able to package their assets into companies and sell them as shares rather than as property assets. It is simply not fair that Western Australian families accept their stamp duty obligations on their homes while some large companies avoid the taxation responsibilities intended by Government. Therefore, a number of changes will be made to the Stamp Act that, subject to the passage of legislation, will be effective from today. These changes address the known avoidance practices and are detailed in the document, “Stamp Act Amendments - Anti-Avoidance Provisions”, which I now table. The Government decided to make the legislation closing these avoidance options retrospective to prevent any party taking advantage of the delay between the changes to the Stamp Act and today’s announcement. [See paper No 111.]
It has come to the attention of the Government that an inequitable situation exists within the taxation system that threatens to severely penalise the State. This inequity allows large companies to pay just $1 in stamp duty on property transactions worth millions of dollars while the average family is required to pay about $5 000 in stamp duty on its home. Last year, the stamp duty avoidance measures adopted by some companies cost the taxpayers of Western Australia $35m, and the State Revenue Department is investigating seven more cases that could amount to a further $37m loss. These are significant amounts of money that are being denied to the people of Western Australia. These funds could be used to further enhance the good work of this Government since it came to power in building three new hospitals and 27 police stations. This tax avoidance was possible because companies took advantage of the different ways shares and property are treated for the purposes of determining stamp duty liability. Stamp duty on property is charged at $4.85 for each $100 of value whereas stamp duty on company shares is charged at between 15¢ and 60¢ for each $100, depending on the type of company involved. Further, the duty on company shares is based only on the value of the company; that is, the gross value of assets less liabilities. Subsequently, entities have been able to package their assets into companies and sell them as shares rather than as property assets. It is simply not fair that Western Australian families accept their stamp duty obligations on their homes while some large companies avoid the taxation responsibilities intended by Government. Therefore, a number of changes will be made to the Stamp Act that, subject to the passage of legislation, will be effective from today. These changes address the known avoidance practices and are detailed in the document, “Stamp Act Amendments - Anti-Avoidance Provisions”, which I now table. The Government decided to make the legislation closing these avoidance options retrospective to prevent any party taking advantage of the delay between the changes to the Stamp Act and today’s announcement. [See paper No 111.]
This tax avoidance was possible because companies took advantage of the different ways shares and property are treated for the purposes of determining stamp duty liability. Stamp duty on property is charged at $4.85 for each $100 of value whereas stamp duty on company shares is charged at between 15¢ and 60¢ for each $100, depending on the type of company involved. Further, the duty on company shares is based only on the value of the company; that is, the gross value of assets less liabilities. Subsequently, entities have been able to package their assets into companies and sell them as shares rather than as property assets. It is simply not fair that Western Australian families accept their stamp duty obligations on their homes while some large companies avoid the taxation responsibilities intended by Government. Therefore, a number of changes will be made to the Stamp Act that, subject to the passage of legislation, will be effective from today. These changes address the known avoidance practices and are detailed in the document, “Stamp Act Amendments - Anti-Avoidance Provisions”, which I now table. The Government decided to make the legislation closing these avoidance options retrospective to prevent any party taking advantage of the delay between the changes to the Stamp Act and today’s announcement. [See paper No 111.]
It is simply not fair that Western Australian families accept their stamp duty obligations on their homes while some large companies avoid the taxation responsibilities intended by Government. Therefore, a number of changes will be made to the Stamp Act that, subject to the passage of legislation, will be effective from today. These changes address the known avoidance practices and are detailed in the document, “Stamp Act Amendments - Anti-Avoidance Provisions”, which I now table. The Government decided to make the legislation closing these avoidance options retrospective to prevent any party taking advantage of the delay between the changes to the Stamp Act and today’s announcement. [See paper No 111.]
[See paper No 111.]
Mr KIERATH replied: It has come to the attention of the Government that an inequitable situation exists within the taxation system that threatens to severely penalise the State. This inequity allows large companies to pay just $1 in stamp duty on property transactions worth millions of dollars while the average family is required to pay about $5 000 in stamp duty on its home. Last year, the stamp duty avoidance measures adopted by some companies cost the taxpayers of Western Australia $35m, and the State Revenue Department is investigating seven more cases that could amount to a further $37m loss. These are significant amounts of money that are being denied to the people of Western Australia. These funds could be used to further enhance the good work of this Government since it came to power in building three new hospitals and 27 police stations. This tax avoidance was possible because companies took advantage of the different ways shares and property are treated for the purposes of determining stamp duty liability. Stamp duty on property is charged at $4.85 for each $100 of value whereas stamp duty on company shares is charged at between 15¢ and 60¢ for each $100, depending on the type of company involved. Further, the duty on company shares is based only on the value of the company; that is, the gross value of assets less liabilities. Subsequently, entities have been able to package their assets into companies and sell them as shares rather than as property assets. It is simply not fair that Western Australian families accept their stamp duty obligations on their homes while some large companies avoid the taxation responsibilities intended by Government. Therefore, a number of changes will be made to the Stamp Act that, subject to the passage of legislation, will be effective from today. These changes address the known avoidance practices and are detailed in the document, “Stamp Act Amendments - Anti-Avoidance Provisions”, which I now table. The Government decided to make the legislation closing these avoidance options retrospective to prevent any party taking advantage of the delay between the changes to the Stamp Act and today’s announcement. [See paper No 111.]
It has come to the attention of the Government that an inequitable situation exists within the taxation system that threatens to severely penalise the State. This inequity allows large companies to pay just $1 in stamp duty on property transactions worth millions of dollars while the average family is required to pay about $5 000 in stamp duty on its home. Last year, the stamp duty avoidance measures adopted by some companies cost the taxpayers of Western Australia $35m, and the State Revenue Department is investigating seven more cases that could amount to a further $37m loss. These are significant amounts of money that are being denied to the people of Western Australia. These funds could be used to further enhance the good work of this Government since it came to power in building three new hospitals and 27 police stations. This tax avoidance was possible because companies took advantage of the different ways shares and property are treated for the purposes of determining stamp duty liability. Stamp duty on property is charged at $4.85 for each $100 of value whereas stamp duty on company shares is charged at between 15¢ and 60¢ for each $100, depending on the type of company involved. Further, the duty on company shares is based only on the value of the company; that is, the gross value of assets less liabilities. Subsequently, entities have been able to package their assets into companies and sell them as shares rather than as property assets. It is simply not fair that Western Australian families accept their stamp duty obligations on their homes while some large companies avoid the taxation responsibilities intended by Government. Therefore, a number of changes will be made to the Stamp Act that, subject to the passage of legislation, will be effective from today. These changes address the known avoidance practices and are detailed in the document, “Stamp Act Amendments - Anti-Avoidance Provisions”, which I now table. The Government decided to make the legislation closing these avoidance options retrospective to prevent any party taking advantage of the delay between the changes to the Stamp Act and today’s announcement. [See paper No 111.]
This tax avoidance was possible because companies took advantage of the different ways shares and property are treated for the purposes of determining stamp duty liability. Stamp duty on property is charged at $4.85 for each $100 of value whereas stamp duty on company shares is charged at between 15¢ and 60¢ for each $100, depending on the type of company involved. Further, the duty on company shares is based only on the value of the company; that is, the gross value of assets less liabilities. Subsequently, entities have been able to package their assets into companies and sell them as shares rather than as property assets. It is simply not fair that Western Australian families accept their stamp duty obligations on their homes while some large companies avoid the taxation responsibilities intended by Government. Therefore, a number of changes will be made to the Stamp Act that, subject to the passage of legislation, will be effective from today. These changes address the known avoidance practices and are detailed in the document, “Stamp Act Amendments - Anti-Avoidance Provisions”, which I now table. The Government decided to make the legislation closing these avoidance options retrospective to prevent any party taking advantage of the delay between the changes to the Stamp Act and today’s announcement. [See paper No 111.]
It is simply not fair that Western Australian families accept their stamp duty obligations on their homes while some large companies avoid the taxation responsibilities intended by Government. Therefore, a number of changes will be made to the Stamp Act that, subject to the passage of legislation, will be effective from today. These changes address the known avoidance practices and are detailed in the document, “Stamp Act Amendments - Anti-Avoidance Provisions”, which I now table. The Government decided to make the legislation closing these avoidance options retrospective to prevent any party taking advantage of the delay between the changes to the Stamp Act and today’s announcement. [See paper No 111.]
[See paper No 111.]
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