Explanatory Memorandum
(Circulated by authority of the Treasurer, the Hon Peter Costello, MP)Chapter 2 - Exemption for goods imported by Olympians
Overview
2.1 The amendments in Schedule 1 will provide exemptions from sales tax for certain goods imported by, or on behalf of, non-Australian Sydney 2000 Olympic and Paralympic Family Members and delegations and participants in the Sydney 2000 Olympics, Paralympic and associated events. The amendments give effect to the decision of the Ministerial Committee of the Sydney 2000 Games notified in the Committees Minute of 27 August 1997. Schedule 1 also contains amendments to exempt from sales tax certain items of commercial space equipment. Chapter 1 contains an outline of those amendments.
Summary of the amendments
2.2 The amendments to the Sales Tax (Exemptions and Classifications) Act 1992 (the Exemptions and Classifications Act) will provide an exemption from sales tax for accompanied baggage and personal effects and unaccompanied baggage and cargo imported by, or on behalf of, non-Australian Sydney 2000 Olympic and Paralympic Family Members and delegations, and participants in the Sydney 2000 Olympics, Paralympic and associated events. The exemption is not extended to goods for sale, alcohol and tobacco products, and items of equipment which are more appropriately handled under the temporary importations provision, including in particular high revenue potential items such as vehicles and digital communications equipment.
2.3 The amendments will commence from the date of Royal Assent. The amendments will also provide for a transitional credit ground to ensure the sales tax exemption applies from 1 March 1998, the commencement date of the customs duty exemption provided by item 64 in Schedule 4 to the Customs Tariff Act 1995 .
Background to the legislation
2.4 The Ministerial Committee on the Sydney 2000 Games on 27 August 1997 agreed that certain goods imported by, or on behalf of non-Australian Sydney 2000 Olympic and Paralympic Family Members and delegations, and participants in the Sydney 2000 Olympics, Paralympic and associated events, should be exempted from sales tax. The first events covered by the new exemption will be the Olympic Arts Festival event 'A Sea Change' during 1998 and the International Sailing Regatta in September 1998.
2.5 The exemption is not extended to goods for sale, alcohol and tobacco products, motor vehicles and motor vehicle parts, television cameras and equipment for radio and television broadcasting.
2.6 The measure mirrors and complements a duty exemption agreed to by the Ministerial Committee and provided by item 64 in Schedule 4 to the Customs Tariff Act 1995 .
Explanation of the amendments
2.7 A new transitional credit ground is added to Table 3A of Schedule 1 to the Sales Tax Assessment Act 1992 (the Assessment Act). The new transitional credit ground enables persons to receive credit for sales tax paid for dealings with goods that occurred after the decision by the Ministerial Committee, but before the commencement of the legislative amendments. This rule makes the sales tax exemption available to participants of events such as 'A Sea Change' and the International Sailing Regatta in September 1998. The transitional credit ground covers the period from 1 March 1998, when a corresponding duty exemption came into effect, until the day the new sales tax exemption receives Royal Assent. The exemption will cover most, if not all, of the Sea Change program. [Item 1, new TCR5]
2.8 A new sales tax exemption item is added to Schedule 1 to the Exemptions and Classifications Act. The new exemption item, item 197, provides the exemption to imported goods, if they are covered by item 64 in Schedule 4 to the Customs Tariff Act 1995 . Item 197 does not list the detail of the dealings with goods which are exempt, rather the detail is provided by the reference to proposed new duty exemption, item 64 in Schedule 4 of the Customs Tariff Act 1995 . The amendment of the law in this way ensures that the sales tax and duty exemptions are identical, reflecting the Ministerial Committees decision as expressed in the Committees Minute of 27 August 1997. [Item 2, new Item 197]
Application
2.9 The amendments to the Assessment Act apply to dealings with goods on or after 1 March 1998 and before these amendments receive Royal Assent. [Item 1]
2.10 The amendments to the Exemptions and Classifications Act apply to dealings on or after these amendments receive Royal Assent. [Item 3]