STAMP DUTIES REWRITE – 1 JULY 1998

In December 1997, the New South Wales government passed the new Duties Act, which becomes effective on 1 July 1998. The new Act has many advantages over the current law. It is simpler and easier to understand, user friendly, corrects many instances where stamp duty is incurred inadvertently and inequitably, removes archaic concepts and language, and simplifies the stamping of cross border transactions. The impact of the changes will be far reaching – from the purchase of a family home to a multi-million dollar commercial transaction. As an example, not all dealings in property will, from that date, be potentially liable to duty (as is the case now). Instead, only a dealing in "dutiable property" will be liable. "Dutiable property" is defined in the Act and is relatively wide-ranging. The rates of duty remain unchanged. One welcoming change for the tax-payers of this State is that the time period for effecting the payment of stamp duty (without penalty) will now, under the new Act, be three months instead of the present two. However, in practice, this is not likely to benefit most purchasers of real property, where settlements, as a general rule, take place within a period of 2 months from the date when the contract is entered into, meaning, effectively, that the duty must be paid in that time. Paul Bailey paulb@gells.com.au

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