Explanatory Memorandum
(Circulated by authority of the Treasurer the Hon. P.J. Keating, M.P.)GENERAL OUTLINE
The Taxation Administration Amendment (Recovery of Tax Debts) Bill 1986 will amend the Taxation Administration Act 1953 to modify, in relation to the recovery of unpaid tax, any application of the law of a State or Territory dealing with the limitation of actions to recover debts.
The provisions of the Bill will operate to modify a State or Territory limitation law only where the unpaid tax is being, or has been, disputed by the lodgment of an objection against an assessment or decision of the Commissioner of Taxation. Further, the modified application of a particular State or Territory limitation law will occur only where that law applies to the recovery of unpaid tax by virtue of section 64 of the Judiciary Act 1903.
The modification of State and Territory limitation laws will enable an action for the recovery of a taxation debt to be commenced within the appropriate period specified in the relevant limitation law measured not from the due date of the debt, but from the date on which all proceedings arising out of the lodgment of an objection disputing the debt are finalised. In so modifying State and Territory limitation laws, the Bill overcomes the decision of the Queensland Full Supreme Court in Deputy Commissioner or Taxation v Moorebank Pty Ltd.
The modification will apply to all actions to recover unpaid tax irrespective of when the tax became due and payable, but will not apply to cases that have already been decided by the courts.
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