Commonwealth of Australia Explanatory Memoranda Commonwealth of Australia Explanatory Memoranda[Index] [Search] [Download] [Bill] [Help]
1997
HOUSE OF REPRESENTATIVES
COMMONWEALTH VEHICLES (REGISTRATION AND EXEMPTION FROM TAXATION) BILL 1997
EXPLANATORY MEMORANDUM
(Circulated with the authority of
the Minister for Finance, the Honourable
John Fahey,
MP)
88513 Cat. No.
96 7723 2 ISBN 0644 502627
COMMONWEALTH VEHICLES (REGISTRATION AND EXEMPTION FROM TAXATION) BILL 1997
OUTLINE
This
Bill has been prepared in the context of the sale or refinancing of DASFLEET,
however, the Bill's provisions will apply to any vehicle leased to the
Commonwealth or a Commonwealth authority. This Bill provides for the
registration of motor vehicles owned by or leased to the Commonwealth and
Commonwealth authorities, and exempts from State and Territory
taxation:
the sale of the DASFLEET
assets that include the vehicle
fleet
leases of vehicles back to the
Commonwealth and Commonwealth
authorities
the registration under State
or Territory law of vehicles leased to the Commonwealth and Commonwealth
authorities.
The Bill establishes a
Register of Commonwealth motor vehicles and allows for vehicles that are owned
by, or leased for at least 3 months to, the Commonwealth or a Commonwealth
authority to be registered. Regulations will provide for details of the vehicle
register, including such issues as registration certificates, labels and
Commonwealth number plates. The Bill exempts vehicles on the Commonwealth motor
vehicle register from the need to be registered under a law of a State or
Territory or to have third party
insurance.
The Commonwealth
currently bears its own liability for third party claims arising out of the use
of motor vehicles owned by the Commonwealth or a Commonwealth authority - see
the Commonwealth Motor Vehicles (Liability) Act 1959. The question of
the extension of the Commonwealth's liability to cover vehicles that are leased
to the Commonwealth or a Commonwealth authority is being addressed in the
Commonwealth Motor Vehicles (Liability) Amendment Bill
1997.
FINANCIAL IMPACT
STATEMENT
The measures contained
in this legislation are intended to continue current arrangements with regard to
vehicles used by the Commonwealth after DASFLEET is sold or its vehicles
refinanced. The Bill will permit the Commonwealth to continue to use
Commonwealth number plates rather than registering vehicles under State and
Territory law and continue its existing exemption from stamp duty, registration
and compulsory third party
insurance.
Without the
legislation:
The Commonwealth would
incur costs in the first year of approximately $10m in registration fees, stamp
duty on registration and compulsory third party insurance. The net present
value over 10 years is in the order of
$45m.
Purchasers would be charged stamp
duty on the transfer of assets (excluding vehicles) of approximately $2.75m,
which would generally be deducted from the sale price paid to the Commonwealth
by purchasers.
The owner of the vehicles
leased to the Commonwealth would be charged approximately $1.5m a year stamp
duty on leasing arrangements, which would be passed on to the Commonwealth
through vehicle leasing
charges.
These figures relate only
to approximately 9,650 vehicles which are currently operated by DASFLEET. There
are a further 12,000 or so vehicles which carry Commonwealth number-plates which
are not operated by DASFLEET, but which are covered by this legislation. The
costs to the Commonwealth would be much higher in the event that these
non-DASFLEET vehicles are leased from the private sector in the future. The
total potential costs are approximately twice those estimated for vehicles
currently operated by DASFLEET.
NOTES ON CLAUSES
Part 1 -
Preliminary
Clause 1 - Short
title
1. This clause provides for
the Act to be cited as the Commonwealth Vehicles (Registration and Exemption
from Taxation) Act
1997.
Clause 2 -
Commencement
2. This clause provides
that the Act commences on the day on which it receives the Royal
Assent.
Clause 3 -
Definitions
3. This clause contains
definitions of certain terms that are used in the Act. The terms defined are
Commonwealth authority, DASFLEET, DASFLEET asset, lease, motor vehicle,
register, registered vehicle, registrar, registration, third-party policy,
trailer and vehicle. "Commonwealth authority" is defined to be a body corporate
incorporated for a public purpose by a law of the Commonwealth, the Jervis Bay
Territory or an external Territory other than Norfolk Island, other than a
prescribed body corporate. In the regulations it is proposed to exclude trading
enterprises from the coverage of the
Act.
Clause 4 - Objects of
Act
4. This clause sets out the
objects of the Act, which are to provide for the registration of vehicles used
by the Commonwealth and Commonwealth authorities, and to exempt the sale of
DASFLEET, the lease back of vehicles to the Commonwealth and the registration of
those vehicles under State or Territory law from State and Territory
taxes.
Clause 5 - Extension of
Act to external Territories
5. This
clause provides for the Act to extend to the Australian Antarctic Territory, the
Coral Sea Islands Territory and the Territory of Heard Island and McDonald
Islands. The Act automatically extends to the Jervis Bay Territory, the
Territory of Christmas Island and the Territory of Cocos (Keeling)
Island.
Part 2 - Registration
of Commonwealth
Vehicles
Clause 6 - Register
of Commonwealth vehicles
6. This
clause establishes the register of Commonwealth vehicles under the control of
the Registrar.
Clause 7 -
Registrar
7. This clause establishes
the office of Registrar within the
Department.
Clause 8 - Vehicles
that may be registered
8. This
clause states that the only vehicles that may be registered in the register are
those owned by, or leased for a continuous period of at least 3 months to, the
Commonwealth or a Commonwealth
authority.
Clause 9 -
Registration of motor
vehicles
9. Clause 9 deals with the
procedure for the registration of motor vehicles by the
Registrar.
Clause 10 -
Cancellation of registration by
Registrar
10. This clause sets out
the circumstances in which the Registrar may cancel the registration of a
vehicle.
Clause 11 - Automatic
cancellation of
registration
11. This clause
provides that registration is automatically cancelled if a vehicle owned by the
Commonwealth ceases to be so owned, or, in the case of a vehicle leased to the
Commonwealth, if the lease expires or is terminated.
Clause 12 - suspension of
registration
12. This clause sets
out the circumstances in which the Registrar may suspend the registration of a
vehicle and terminate that
suspension.
Clause 13 - Surrender
of registration
13. This clause
provides that the owner of a registered vehicle may surrender the registration
to the Registrar.
Clause 14 -
Exemption from registration etc. under State or Territory
laws
14. This clause provides that
if a vehicle is registered under the Act there is no obligation to register the
vehicle, or take out third party insurance in respect of the vehicle, under the
law of a State or Territory, and a person is not guilty of an offence under a
State or Territory law for driving such a
vehicle.
Clause 15 - Regulations
may make further provision with respect to registered
vehicles
15. This clause authorises
the making of regulations for the keeping of the register, the issue of
registration certificates, number plates and registration labels and the display
of number plates and labels, and the giving of notices to the
Registrar.
Part 3 - Exemption
from Taxation
Clause 16 -
Exemption from State and Territory
taxation
16. This clause provides
that no tax is payable under State or Territory laws in respect
of:
the sale by the Commonwealth of a
package of DASFLEET assets that includes the fleet, or the major part of the
fleet, of vehicles used by it for the purposes of
DASFLEET
the sale by the Commonwealth of
the fleet, or the major part of the fleet, of vehicles used by it for the
purposes of DASFLEET
the lease of a
vehicle for a period of at least 3 months to the Commonwealth or a Commonwealth
authority
the registration under a law
of a State or Territory of a vehicle that is leased to the Commonwealth, or a
Commonwealth authority, for at least 3
months.
Part 4 -
Miscellaneous
Clause 17 -
Regulations
17. Subclause (1)
provides the usual regulation-making power. Subclause (2) authorises the
prescribing of penalties not exceeding 10 penalty units for offences against the
regulations.