Explanatory Memorandum
(Circulated by the authority of the Treasurer the Hon Ralph Willis, M.P.)CHAPTER 20 - SALES TAX - WIRELESS TRANSCEIVER FOR USE WITH THE ROYAL FLYING DOCTOR SERVICE OF AUSTRALIA
Overview
20.1 The Bill will amend item 169 of the First Schedule to the Sales Tax (Exemptions and Classifications) Act 1992 (E & C Act ) to correct a consequential amendment made to the item by the Radiocommunications (Transitional Provisions and Consequential Amendments) Act 1992 . It will also provide a transitional credit to cover dealings with goods that occurred after 30 June 1993 and before the Bill receives Royal Assent.
Summary of the amendments
20.2 To reinstate the exemption for persons who use wireless transceivers to make contact with radio services conducted by the Royal Flying Doctor Service of Australia and similar bodies.
20.3 The amendment to the exemption will apply to dealings with goods from the date that the Bill receives Royal Assent. The credit will apply to dealings with goods after 30 June 1993 and before the Bill receives Royal Assent. [Subclauses 2(1), 158(2) and clause 159]
Background to the legislation
20.4 Item 169 of the First Schedule to the E & C Act was designed to allow limited exemption from sales tax for wireless transceivers used by persons mainly to make contact with radio services conducted by the Royal Flying Doctor Service and similar bodies. The exemption was primarily obtained by farmers in the outback areas of Australia.
20.5 In late 1992, a consequential amendment was made to subitem 169(2) of the E & C Act by the Radiocommunications (Transitional Provisions and Consequential Amendments) Act 1992. The purpose of that amendment was to align the terminology of item 169, which was expressed in terms of the Radiocommunications Act 1983, to that used in the new Radiocommunications Act 1992 (Radcom Act).
20.6 The amendment, which was made to the definition of 'authorised person' in subitem 169(2), basically removed the exemption for people who are authorised to use wireless transceivers, as they do not conduct the service under the Radcom Act. The amended legislation in effect provided exemption to the Royal Flying Doctor Service of Australia and similar bodies which are already exempted from sales tax under another provision.
Explanation of the amendments
20.7 The Bill amends the definition of 'authorised person' in subitem 169(2) of the E & C Act, so that persons who use wireless transceivers to connect with services provided by the Royal Flying Doctor Service or similar bodies, are able to gain exemption on the equipment.
20.8 The current definition of 'authorised person' is amended to allow exemption to a person who is authorised to 'operate the wireless transceiver'. The term "wireless transceiver" is not defined. Accordingly the ordinary meaning of the term will apply namely, a radio capable of both transmitting and receiving radio waves. The authorisation to use the wireless transceiver in the specified circumstances is currently by being licensed as an "outpost station", a category of licence under the Radiocommunications Regulations made under the Radcom Act. [Paragraph (b) of clause 157]
20.9 A transitional credit is provided to cover persons, entitled to the exemption, who have purchased a wireless transceiver inclusive of sales tax after 30 June 1993 and before this Bill receives Royal Assent. [Clause159]
20.10 Any person in this position may apply to the Australian Taxation Office for a refund.