The Revenue Legislation Amendment Bill 2023 (NSW) (the Bill) was introduced into NSW parliament yesterday. It has already been read for a second time in the Legislative Assembly.
What's changed?
The key measure of the Bill is to remove the 90% concession available for duty otherwise chargeable on 90% or greater acquisitions in public landholders (listed companies and unit trusts that directly or indirectly hold land in New South Wales with an unencumbered market value of $2 million or more).
Date of effect
The change will apply to acquisitions occurring from 1 July 2023 (an acquisition generally, but not always, occurs on settlement of a share acquisition even if the register has not been updated). There are no transitional provisions.
What does this mean?
The removal of the concession means that acquisitions of 90% or more in public landholders will be charged with duty at the general rate (5.5% rather than 0.55%) on the market value of the NSW land assets (including chattels) held directly or indirectly by the landholder. The approach is aligned with the Western Australian and Northern Territory public landholder regimes where both jurisdictions do not have the concessional rates.
Why is this important?
Acquisitions which occur on or after 1 July 2023, even if entered into pursuant to an arrangement before 1 July 2023, will be subject to a significantly higher amount of stamp duty than under the current regime.
Who will this impact?
This will impact any transactions involving acquisitions of listed companies and unit trusts that hold land and assets in NSW (directly or indirectly).
What's next?
The Bill is currently awaiting second reading debate which is currently adjourned for 5 days.
We will keep you updated as new details come to light but please feel free to reach out to the KWM tax team with any questions in the meantime.
