State Revenue Legislation (Further Amendment) Bill

Debate resumed from 27 October.

Mr J. H. MURRAY (Drummoyne) [11.51]: This bill has a number of provisions that are consequential upon the recent budget introduced into this House. A number of minor amendments relate to stamp duty, financial institutions duty, debits tax, payroll tax, land tax and statute law. In relation to stamp duty, the exemption will allow the older generation of farmers to retire and provide an opportunity for the younger generation of farmers to bring new ideas, enthusiasm and greater production to the rural sector. The increased production will have
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a flow-on benefit to New South Wales and, obviously, anything that will be of financial benefit to the suffering farming community will have the full support of the Opposition.

To encourage foreign investment in New South Wales the bill provides for an exemption from financial institutions duty, debits tax and loan security duty in respect of regional headquarters that are set up in New South Wales from July 1995 - another initiative that the Opposition has been pushing for some time. New South Wales is falling behind Victoria and Queensland. It used to be the commercial hub of Australia in both quantum and growth rate, but that has not been the case recently. Any inducement, such as this provision, is welcomed by the Opposition.

The farm household support scheme will provide financial assistance for farmers. The bill provides for an exemption from financial institutions duty in respect of payments to farmers' bank accounts pursuant to the scheme. The bill strengthens the definition of "Bill facility" for the purpose of assessing loan security duty whilst maintaining government policy. I understand that some amendments will be moved in relation to the FID and its impact on the stock exchange. The Opposition will support the amendments when the Treasurer moves them.

The bill extends until 31 December the current exemption from stamp duty for home loan refinancing. I presume at that time, with the heat coming into the first-home buyers market, that the need for inducements will be reduced. The bill provides for a two-stage increase in the threshold of payroll tax, from $500,000 to $550,000 effective 1 January 1995, and to $600,000 effective 1 January 1996. Another provision relates to the current land tax exemption for boarding houses providing low-cost accommodation. That is a commendable initiative, which will be extended to all other forms of low-cost accommodation, subject to guidelines being met.

I understand that the exemption, which will apply to residential as well as to boarding houses, will be limited to those within a certain distance from the GPO. Implicit in the legislation is that all low-income renters live within five kilometres of the central business district, but that is not so. In many cases rents in the Blacktown area and along the Canterbury Bankstown line from Campsie to Lakemba are much less than rents within five kilometres of the GPO. People living in those areas are all low-income earners, whose workplace is in the area. The exemption should be more equitable. Why five kilometres from the Sydney GPO, when the Hunter-Newcastle and Illawarra areas have been excluded? Those two areas would be in a similar situation.

Charity groups such as the Salvation Army and the Sydney City Mission have in many cases centred their social service activities close to the CBD, particularly around the Surry Hills area, which meant that those who sought boarding house or low-income accommodation lived in close proximity to those services. However, a number of charities are in the process of relocating. Consequently the concentration and conglomeration of hostel-type facilities, which were halfway facilities for people going into boarding houses, are moving away from the CBD. The Minister should keep a close eye on that. I am seeking to be constructive, not critical.

However, I am critical of one aspect, because the Government is having two bob each way. The legislation recognises the need to encourage private, low-income rental accommodation through boarding houses and unit rental properties. But on the other hand, changes to the Local Government Act have changed the rating of boarding house facilities from residential to commercial. Consequently many boarding houses, because of their different rates this year - a commercial rate rather than a residential rate - have had to increase the rent for their rooms to up to $100 per week. Those are low-cost facilities. The Government is doing the right thing in attempting to minimise one of the cost components for boarding houses: payroll tax. On the other hand, the Government is taking away any advantage that could accrue out of the legislation by decreeing that local government must rate boarding houses under a commercial rate. If something is not done immediately, no boarding house in the inner city will avail of the provision because to do so would mean going out of business. Clients would not be able to pay $170 or $180 per week for a room, which is $100 a week more than they are paying at present, to cover the rate increase.

I have had contact with officers from Leichhardt Council and Waverley Council who are faced with the problem I have outlined. According to legal advice they have received, there is no provision for councils to re-rate boarding houses. The honourable member for Bligh has a bill at the second reading stage that relates to this matter. The Treasurer should bring the issue to the Government's attention so that the proposal he has put before the House can come into effect. Unless a change is made to the Local Government Act boarding houses will not be able to make use of this excellent provision. The bill provides a concession for non-residential strata unit owners, who are currently taxed unfavourably compared with those who own residential strata units. The amendment will allow owners of non-residential strata units to claim the threshold in the same way as owners of residential strata units. I support the bill.

Mr SMALL (Murray) [12.02]: I wish to express my gratitude to the Government. I congratulate the Treasurer, and Minister for the Arts in particular on the good work he has done. Difficulty has been experienced for a number of years in securing exemption from stamp duty for farms being handed down within a family, to children in particular. I have canvassed this issue for the past four or five years and wrote to the former Premier, the Hon. Nick Greiner, and the present Premier and the Treasurer. I am pleased that the Government is providing an exemption from stamp duty for the intergenerational transfer of properties, particularly from parents to children and/or grandchildren and from parents to stepchildren.

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I would be very grateful if transfer between siblings could be assisted in the same way. The bill states that land would have to be gifted in the first place. I hope that there may still be opportunity for amendment so that the Treasurer can consider the case of transfer of properties between siblings. I think of the instance in which two brothers may have bought a property and one brother leaves the land to secure work elsewhere because the property does not generate sufficient income for them both. The other brother either purchases or is gifted the land. It may well be that in that case the property should be exempted from stamp duty. In Victoria a transfer between brothers may be exempted from stamp duty if it can be proved that there is a good working relationship between the siblings. That is a reasonable provision.

Great difficulty has occurred in the transfer of land between elderly parents and their children. The difficulty goes back to the drought of 1981 to 1983. In many cases parents have held on to a farm and have accumulated huge debts because they have had to pay high interest rates. They have handed over responsibility for managing the farm to their sons or daughters but have not been able to effect a legal transfer because of stamp duty and other costs. Parents have been placed in great difficulty because they have not been able to benefit from either unemployment benefits or social security benefits on retirement, as the land is still held in their names. This has been a matter of great distress and has led to many problems. I am glad that the Treasurer and the Government have recognised the needs of those on family farms and that land will now be able to be handed down to children and/or grandchildren without the burden of the cost of stamp duty. There are enough legal costs and other obligations that have to be met without that added burden.

I recognise that there are matters that need to be further considered. One area that needs to be addressed is the situation to which I have already referred of children who are managing the property of parents who have already retired. The legislation identifies that the main income has to come from the land. The point is that two or three years after parents have retired, having earned their living from the land for many years, their income may not necessarily be derived only from the farm. I commend the support given by the Opposition and all members of Parliament to what is a caring provision for people in difficulty and in need.

Mr NEILLY (Cessnock) [12.09]: I, too, support the State Revenue Legislation (Further Amendment) Bill. I note that the bill amends six Acts. The amendments give statutory provision to Government initiatives announced in the 1994-95 budget. Initiatives contained within the amendments are new. Corrections are made to legislative provision that gives rise to double taxation in some arenas. The latter, by way of necessity, could be corrected. I commend the Government, as did the honourable member for Murray, on the new initiatives in respect of stamp duties applicable to intergenerational rural transfers.

A good case has been advocated by the New South Wales Farmers Association and many cases have been advocated by solicitors in rural communities, who deal with people who have held rural properties. I specifically refer to farming properties designed to generate income from rural activity. In many rural areas there is a tendency for young people to leave farming properties and go to the cities because of lower returns from farming properties. Forgetting the drought and the debt arising from the drought, farmers are usually asset rich, but now find they are not so rich in their capacity to derive day-to-day incomes. As a consequence, any impost on the passage of property from one generation to the other has always been to the detriment of people wanting to remain on the land and generate income from that source.

In many instances because stamp duty has been payable these people have been loath to conduct the transfer of property, and advice has been given to the beneficiaries to leave the property in the name of the estate rather than transfer it into the names of the beneficiaries, who do not have the resources to pay the stamp duty. They believe it is better to leave the property to posterity. Other problems have been created where an inevitable transfer has had to take place. The legislation complies with Commonwealth superannuation requirements and stamp duty concessions are made available to accomplish that mission.

The Newcastle Chamber of Fruit and Vegetable Industries undertook the selling of farm produce on behalf of growers. The legislation enables that chamber to be treated identically to the way in which the Flemington produce markets, conducted by the Sydney Market Authority, are treated. Farmers send their produce to the market to be sold, the sale takes place and money is placed into a trust account. It is passed on to the farmers and the chamber receives its share. The legislation will prevent double taxation.

The legislation is designed to overcome many "irregularities" that existed under the various Acts which are to be amended. I compliment the Government on its change of heart. I do not think any government has considered the problems confronting people on the land in relation to intergenerational transfers of property. Some of the matters raised by the honourable member for Murray in relation to remaining difficulties warrant further consideration in the future. I support the legislation.

Mr SCHULTZ (Burrinjuck) [12.14]: It gives me a great deal of pleasure to compliment the Treasurer on his magnificent contribution to the rural community by introducing changes in legislation relating to stamp duties. That legislation will have an enormous impact on the ability of young people to remain on family farms. I had a number of discussions with some of my constituents, in particular a Mr Flanery from Galong in the Burrinjuck electorate. I wrote to the Minister and alerted him to some serious concerns of Mr Flanery and others about the initial announcement by the Treasurer about intergenerational farm transfer.
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I stated in that correspondence that I had discussed the matter further with Mr Flanery. Following that discussion, my constituent had gone to considerable trouble to forward to me substantive information which indicated that the general farming community would not be affected by the proposed legislative changes required to give stamp duty relief, because the majority of farming land - in the Burrinjuck electorate in particular - is held by way of family company ownership.

When Mr Flanery's father died in 1957 he held properties in his own name. As a result the family paid in the vicinity of 30 per cent of the value of his father's assets in State and Federal death duties. Large numbers of farming families were caught in a similar fashion and this culminated in a rapid transfer by family members of farming land ownership to company ownership. For many other reasons the trend towards company ownership continued. A well-known successful rural adviser, who had been operating in the district for 30 years, provided information on land ownership in the Boorowa, Cootamundra, Harden, Wallendbeen and Young areas. The pertinent point raised in the correspondence was that property owners who represent the most successful farming groups, in the majority of cases, operate their farming enterprises as family companies, and would be disadvantaged if their circumstances were not considered for stamp duty relief.

Fifty-one ownerships covering about 300 properties with an aggregate area of 80,000 hectares were broken up as follows: 11 of those ownerships were held in individual names; one was part company, and a large part individual; six were mostly but not entirely held under company ownership; and 33 were wholly owned by companies. There were a few cases of land held in trust, but significant areas were not involved. In the vicinity of 88 per cent of farms in that significant survey were held wholly or mainly under company ownership. When I wrote to the Minister I noted that company ownership means farming family ownership, not corporate ownership. Corporate ownership is applicable to some farming land in New South Wales, but I was advised it was not significant and had little bearing in the Burrinjuck electorate.

I have used the case of my constituent's family as an example of how the announcement of stamp duty relief disadvantaged farms under company ownership. The majority of this family's farming land, six properties, was owned by the family company. Mr Flanery, his brother and their wives were the beneficial owners of the shares in that family company. The Treasurer looked sympathetically at this problem. The two brothers have six children between them, all of whom are in their late twenties. The fathers are 30 or more years older than the children, who are working on the farm basically as labourers, because under present conditions they are economically unable to own land.

There were two options for transferring land to the family. Unfortunately, prior to the proposed change to the legislation both alternatives involved in the vicinity of $300,000 in stamp duty and were therefore out of the question. In the first option they could simply transfer one property to each of the children out of the company, penalising them to the tune of $300,000 in stamp duty costs. The second option was for Mr Flanery's family to buy three of the properties from one of his company holdings, for which stamp duty of $150,000 was payable.

At the same time my constituent would have to sell his shares in his holding company back to his brother, otherwise he would still be the beneficial owner of half of that company's assets and liable to pay ad valorem stamp duty of approximately $150,000 on the value of the assets. In other words, he would be paying double stamp duty amounting to approximately 11 per cent. There are, of course, a few variations to that example but they all attract the same costs. The situation was complicated further by the triggering of capital gains tax by most of these options, all of which adds up to an enormous disincentive to the orderly and most productive method of rural farm ownership. My constituent's family has attempted to overcome the problem for years, and the best advice they received and acted upon was to make a will. In other words, there would be no benefits to the children until the parents died.

Legal circles have suggested an option whereby stamp duty could be removed when assets of the company are transferred to its shareholders in their own right - workable in most cases, but by description it would be broad reaching. Learned opinion was that this would be practical only in small companies. My constituent had raised an issue of significant and critical importance to rural New South Wales. It was because of that importance that I wrote to the Treasurer, and as a result of that correspondence he acknowledged that a decision favourably disposed towards the points raised in my correspondence would have an enormous impact on rural New South Wales and, more importantly, an enormous impact on halting the haemorrhaging of our young people from rural properties, away from home, in order to maintain some sort of decent living for themselves. In addition, it would remove a depressing, worrying situation for people who have farmed their properties for decades, and were looking at a situation where their farming enterprises could not be carried on because of the debilitating costs of farm transfer stamp duty.

I place that problem on record on behalf of my constituents and, indeed, all rural constituents in New South Wales who were placed in similar situations to that of Mr Flanery, his brother and family, who can now see a little light at the end of the tunnel following a deep recessionary period and are now experiencing a debilitating drought. I thank the Minister for the magnificent contribution he has made. I thank him most sincerely on behalf of my constituency for understanding what I was trying to convey to him in my letter. It was refreshing that the Minister wrote to me after I had alerted him to the concerns of my constituency, and, more importantly, that he took positive action to address that serious matter. Many families throughout New South Wales will be
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beholden to him for many years for the contribution he has made in ensuring that productive agricultural land is maintained as such. I thank you, Mr Acting Speaker for the opportunity to discuss this important, critical issue for New South Wales.

Mr CRITTENDEN (Wyong) [12.24]: In my time as a member of this Parliament I have often heard Government members preface their comments by congratulating the Government and the Minister in the chair, whoever that may be at the time, on what is good legislation. Today I am pleased to do the same thing. The State Revenue Legislation (Further Amendment) Bill has significant and real benefits for New South Wales, and particularly for hard-pressed farm families. The electorate of Wyong has a small rural component but there are family farms, particularly in the Dooralong and Kulnura areas. Families such as the Wilsons and the Gibsons have farmed the Kulnura area, for example, for more than 100 years. No doubt the exemption from stamp duty of the transfer of family farms will benefit them as the family farms pass from one generation to the next, as I know is the intention.

I turn now to another aspect of this bill, which is to encourage foreign investment into New South Wales by an exemption from financial institution duty, debit tax and loans security duty in respect of regional headquarters set up in New South Wales as from 1 July next year. Recently in Indonesia agreement was reached in respect of the Asia Pacific Economic Co-operation. Honourable members have all heard and read about the growing Asian economies. The electronic and print media were given examples of companies wanting to come to Australia, and in particular to Sydney, to establish their regional headquarters in the Asia Pacific region. The Government and the Treasurer have been sensible in establishing exemption from these financial duties because it will lead to the establishment of regional headquarters that will benefit overall the people of New South Wales.

The third aspect I wish to touch on is the raising of the payroll tax threshold from $100,000 to $550,000 from 1 January 1995 and to $600,000 from 1 January 1996. I have been to many businesses in my electorate and have been surprised at the number of employees they have. I visited what I thought was a small engineering works and was staggered to find it and other small businesses have up to 25 employees. Though they had not all met the threshold for payroll tax, they were getting close to it. Those business people expressed concern that that would be a barrier to their employing people once they reached the threshold. I am pleased that the payroll tax threshold has been increased, because obviously it will not be an issue that will impede businesses from expanding their operations. I support the bill.

Mr WINDSOR (Tamworth) [12.27]: It seems as though it is a day for congratulations. I add my congratulations to the Treasurer, particularly for the amendments to the Stamp Duties Act contained in this amending bill relating to intergenerational rural transfers. Many members have spoken on this issue already, but it is important that it be noted that one of the great impediments to the free transfer of land, and I do not mean free in a monetary sense only, has been removed by this Government. Though it will not apply to thousands of people immediately, it will remove one of the real psychological impediments that have impacted on the operation of family farms. The bill will not only engender financial savings but will give younger people the chance to come into the agricultural industry and know they will have some control over their future. That will flow through into their capability to manage their day-to-day operations. That is equally as important as the financial savings.

The average age of farmers - 57 or 58 - has a direct relationship with current rural sector economics and the ability of parents on family farms to transfer their assets to their children without burdening them with great costs. The intergenerational transfer provisions in the bill cover that need. The spirit of the exemption guidelines has been carried through into the bill with provision of various structures for genuine land transfers within families. The farming sector was concerned that the provisions might be too narrow. I congratulate the Treasurer for making them as broad as possible, thus encouraging landowners to transfer their farms at little cost. Having been a general counsellor with the New South Wales Farmers Association for a number of years, I am aware this issue has been raised as an impediment to free flow of land from father and mother to son and daughter. That association will be pleased at the progress of the bill through this House. It is heartening that the Government is listening to the rural community, especially during this time of drought when massive changes have taken place. Measures to reduce costs faced by farm businesses deserve recognition.

Changes to the Pay-roll Tax Act 1971 are made by the amending bill. The current payroll tax general exemption, with an annual threshold of $500,000, is to be increased to $550,000 by 1 January 1995 and by another $50,000 the following year, to $600,000. This positive initiative by the Government, which would be described by economists as bracket creep, is to be commended. Governments of all persuasions, especially conservative governments - which supposedly represent entrepreneurs and support employment from growth-through-business expansion - need to examine closely the use of payroll tax as a means of obtaining funds from business. I support that concept.

A private member's bill which I will seek to introduce into the House will call for exemptions from payroll tax for specific country industries. I ask all members, including the Treasurer, who is aware of the bill, to look closely at that. I ask them to consider how such exemption will affect country areas through intergenerational change and how government can have positive impact on rural communities. The removal of payroll tax from strategic industries mentioned in the bill will encourage growth in major employment areas, given the desperate straits country people find themselves in at present. I urge the
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Treasurer and other members to consider my private member's bill. The most important aspect of this bill is intergenerational land transfer. The Government should be commended for putting such a provision in place.

Mr BECKROGE (Broken Hill) [12.35]: I also support this marvellous piece of legislation. The Government deserves to be congratulated on introducing the bill and on its understanding of the need for exemption to enable changeover between generations of families on the land. The measure shows that Parliament can get it right now and again, as farmers in this State expect. Landowners who have worked on the farm all their lives and have built up properties with the hope of passing them on to their sons or daughters have to pay an impost that has no relation to production; it is just a government tax to raise more revenue. The State Revenue Legislation (Further Amendment) Bill will enable older land-holders to retire to allow younger farmers to take over. Young people need to be encouraged to stay on the land, to build it up like their parents did, to ensure continuity of family farms in this State and throughout Australia, so that farms are not taken over by big business, holding companies, or those who have little respect for other than the bottom line. The bill will assist people on the land and will be of great benefit to New South Wales.

The current legislation makes exemption for union incorporation. The trend these days is for industrial organisations to merge. Such mergers bring benefits to the union membership and to the State. It is a wise step to waive stamp duty for such changeovers, for that will assist incorporation of existing organisations and conveyance of property from organisations that are not incorporated into or are not part of the system. The bill provides general exemption from a government tax which has little relationship to an organisation's production or wellbeing. Most people, other than Treasurers or finance Ministers, would love to see the end of payroll tax. It is a horrible tax because it taxes employment. But the reality is that governments, in order to provide goods and services and infrastructure such as schools, harbours, trains and schools, have to get money in. Payroll tax has a role to play in the New South Wales budget. The Treasurer said that 1,000 or more enterprises will benefit. I hope 10,000 small businesses will benefit. It is a move in the right direction and another good signal from this House, if both sides agree, that small business should be encouraged to survive and get on with the job. Most Australians are employed in small business operations. The small business sector is the engine-room of growth. If we can do something to assist in that regard, we will be all better off for it.

Mr CLOUGH (Bathurst) [12.39]: I also congratulate the Minister on introducing the bill. I have for some time had high regard for the Minister. This bill will help the farming community immensely. Today the New South Wales farming industry is very marginal and is under great threat. Unless governments of all persuasions at State and Federal level get it right, the small family-owned farm will disappear. Last week I spent some time in the mid-west of the State. I was appalled when I saw topsoil that had been blown by the wind up against fences. The enormity of the plight of farmers was brought home to me. I shall restrict my remarks to intergenerational rural transfers. Many farmers are rich in assets but are stone motherless broke. The transfer of a farm from father and mother to sons and daughters should be exempted from duty, and the Treasurer has achieved that result. That will take a load off the minds of the farmers. The Commonwealth Government social security guidelines are difficult to follow. Recently an elderly constituent visited me - he is even more elderly than the age my colleague the honourable member for Blacktown recently attributed to me -

Mr Jeffery: He can't be that old.

Mr CLOUGH: The honourable member for Blacktown has only been conditionally pardoned on the matter. This constituent has a small farm worth over $250,000, but he has no money except for $9,000 in the bank. Like all old people, he is saving to pay for his funeral. His income is $8 per week and he cannot get any assistance from the Commonwealth Government. Stamp duty payable on the transfer of property between members of a family attracting stamp duty has been an inequity for a considerable time, but that inequity has been removed by the Treasurer. The 1984 drought was severe and the recovery period following it was hamstrung almost completely because of enormous interest rates. The attitude of the lending institutions, particularly banks, was to place upon farmers burdens that they could not carry. Consequently, when another drought occurred a few years later, the farmers did not have the capacity to do anything about generating income so essential to the small family farm.

This problem is not peculiar to the areas in the far west of New South Wales; I refer specifically to the good farming areas in the western part of my electorate, as close as Grenfell, Wellington, Gilgandra and such regions as Coonamble. The Federal Government has got it wrong so far as providing drought assistance relief in exceptional circumstances is concerned. The State Government also has it wrong with regard to the allocation of funds for small business. The last thing people want in country areas is to spend $2,500 for their accountants and consultants to tell them how to do better. One man in Nyngan said to me last week, "I run a farm machinery business. What am I going to do? Diversify into fish and chips?" That puts the position quite plainly. This proposal will be of tremendous help to the farmer - to the mothers and fathers who want to see their children remain on the farms and not drift down to the city. There is no future for them in the city because the environment is alien to them. They are trained to do the job they do best, that is, to look after the small farming sector of New South Wales.

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Mr COLLINS (Willoughby - Treasurer, and Minister for the Arts) [12.43], in reply: I thank all honourable members who contributed to this debate, particularly the honourable member for Tamworth, who spoke from the crossbenches. It is important that the people of New South Wales understand that every now and then, with the unanimous will of the Parliament, parliamentarians do things for the benefit of the State. This is one such occasion, and a number of honourable members have been generous in their comments about the legislation. I thank them also for the personal comments they directed towards me.

The Government is putting in place a range of measures that will bring a great deal of relief to some people who are hard pressed at the moment, and the sooner the better. I have indicated to the Opposition that the bill requires a number of necessary amendments. Principally those amendments fall into two batches and will be dealt with in Committee. The amendments are of a procedural nature and I regret that they were not included in the original legislation. Some of the amendments were unforeseen, as the Victorian Government decided that for the time being, pursuant to an agreement reached at the Council of Australian Governments, it would not enact complementary legislation. That does not prevent New South Wales from proceeding with this legislation expeditiously, albeit with amendments. I commend the bill to the House.

Motion agreed to.

Bill read a second time.

Schedule 4

Mr COLLINS (Willoughby - Treasurer, and Minister for the Arts) [12.46], by leave: I move the following amendments in globo:

No. 1 Page 23, Schedule 4(17), line 12. After "subsection (1)", insert "or (2)".

No. 2 Page 23, Schedule 4(17), line 18. After "subsection (1)", insert "or (2)".

No. 3 Page 24, Schedule 4(17). After line 27 insert:

(c) In section 97AB (2A), after "subsection (1)", insert "or (2)".

The bill contains a new charging provision for principal trading by brokers. Previously, various trades by brokers on their own account were exempt from marketable securities duty. The new provision replaces this with a liability to duty at a new low rate. The three items are machinery amendments that will ensure that other relevant provisions will also apply to the new charging provision. This is consistent with existing policy and the current provisions of the Stamp Duties Act. Amendments 1 and 2 are necessary to ensure that the exemption from duty on the transfer of corporate debt securities continues to apply to principal trading and hedging transactions by stockbrokers.

Amendment No. 3 is necessary to ensure that the calculation of stamp duty payable on the exercise of options by stockbrokers and options traders is consistent with other transactions. The need for these amendments became apparent after routine consultations with the industry. I apologise for having to amend the legislation at this stage, but it is better corrected now than at a subsequent time.

Mr J. H. MURRAY (Drummoyne) [12.40]: The Opposition is in agreement with the amendments, although the need for them might be symptomatic of a government not in control of its own agenda. This bill has been pushed through the House without proper consideration. However, I believe these amendments will equalise the return to Treasury, and it would be remiss of the Opposition not to support them.

Amendments agreed to.

Mr COLLINS (Willoughby - Treasurer, and Minister for the Arts) [12.41], by leave: I move the following amendments in globo:

No. 4 Page 27, Schedule 4(27), line 13. Omit "has its principal place of", insert instead "conducts".

No. 5 Page 28, Schedule 4(30). After line 25, insert:

(b) After section 98U(1)(f), insert:

(f1) an account with a bank which is a registered person of:

(i) a New South Wales broker who is a registered person; or

(ii) a broker who lodges quarterly returns with the Australian Stock Exchange in a corresponding State or Territory (within the meaning of section 98 (1));

The bill implements a proposed scheme for the payment of financial institutions duty and marketable securities duty by stockbrokers who primarily conduct business in New South Wales and Victoria. Under the proposed scheme, brokers who operate in both States would pay financial institutions duty in one State only, calculated on the total dutiable receipts in both States. After the introduction of the bill it became apparent that Victoria would not introduce complementary legislation before the commencement date of 1 January 1995.

The first of these will ensure that brokers who receive receipts in New South Wales will remain subject to FID in New South Wales until such time as Victoria commences operating under the scheme. The second amendment will ensure that brokers will still be able to deposit non-dutiable receipts to an exempt bank account. Without such an exempt account brokers could be subject to double duty in New South Wales. A complementary amendment will be made to the Stamp Duties (Financial Institutions Duty) Regulation to ensure that New South Wales brokers who receive receipts in Victoria will not be subject to double duty.

Amendments agreed to.

Schedule as amended agreed to.

Bill reported from Committee with amendments, and report adopted.

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