Tax changes target land sales

Tax professionals have cautiously welcomed state government plans to rewrite the Stamp Act, but have warned that many companies owning land could be surprised to find themselves caught in the tax net. They are also keen to see how the Office of State Revenue interprets the proposed general anti-avoidance provision, given its reputation for aggressive interpretation of tax laws.

Treasurer Eric Ripper unveiled the government’s plans last week, telling a Taxation Institute breakfast the changes would give WA “one of the most business-friendly Stamp Acts you will see in Australia”. The proposed reforms represent a substantial simplification of the Stamp Act, which would be reduced from 400 pages to 200 pages.The reform proposals comprise three major initiatives, which Mr Ripper said would only be accepted as a package. “Unfortunately it has to be all or nothing,” he said.

Institute of Chartered Accountants of Australia WA general manager Con Abbott said the moves to simplify the Stamp Act were to be welcomed. He also welcomed the opportunity to be involved in consultation. “Like all tax changes, it’s very important to look at the detail,” Mr Abbott said.

The changes involve a substantial broadening of the tax base, such that stamp duty would be imposed on virtually all transactions where land worth $2 million or more was acquired through a company or unit trust. (SOURCE/EXTRACT: WA Business News, 16.8.07)