| Focus: | 2014 NSW State Budget and abolition of 'nuisance' taxes |
| Services: | Commercial, Financial Services |
| Industry Focus: | Financial Services |
Further to our articles in 2013 regarding the abolition of mortgage duty, the release of the 2014 NSW State Budget on 17 June 2014 has once again put the abolition of certain 'nuisance' taxes, particularly mortgage duty, back on the agenda.
Readers have undoubtedly lost count of the number of times the abolition date for mortgage duty has been deferred by the NSW Government. You may recall that in the 2013 NSW State Budget, the NSW Government decided to move away from a fixed date to allow an abolition date to be proclaimed by the Governor at some stage in the future.
The NSW Government seems to have acknowledged this unsatisfactory state of affairs in the 2014 NSW State Budget. The Budget Papers have forecast that the NSW Government will abolish transfer duty on non-real business assets such as patents and intellectual property, mortgage duty on business transactions and duty on unlisted marketable securities on 1 July 2016.
Indeed, the former policy of setting (successive) fixed abolition dates has been reinstated with section 203A of the Duties Act 1997 (NSW) now stating that mortgage duty is abolished on and from 1 July 2016.
Secured lenders should continue to assess the mortgage duty implications for new advances and new securities as well as further advances in the context of existing facilities for the time being. However, there once again seems to be a light at the end of the tunnel.
Time will tell whether these 'nuisance' taxes will be abolished on 1 July 2016 or whether this abolition will once again be deferred by the NSW Government.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.