Religious tax exemptions
Ms PATTEN (Northern Metropolitan) (12:33): My question is for the minister representing the Treasurer and relates to tax exemptions for religious organisations. Currently the Duties Act 2000 provides an exemption for transfer duty to a corporation or body established for a religious purpose.
Further, it provides an exemption from transfer duty for the so-called charitable purpose of the advancement of religion. Whereas exemptions for land tax look specifically at use and only apply to land used exclusively for charitable purposes, the exemption for transfer duty is much broader.
As we know from media reports, Catholic Church properties reportedly include offices, residences, car parks, conference centres, tennis courts, mobile phone towers and a restaurant. Seemingly transfers of these properties would have been tax exempt. My question for the minister is: what was the total sum of transfer duty exempted over the last five years for religious organisations or bodies?
Ms SYMES (Northern Victoria—Leader of the Government, Attorney-General, Minister for Emergency Services) (12:35): I will avoid having a stab at that, and I will pass that on to the Treasurer for a detailed response.
Ms PATTEN (Northern Metropolitan) (12:35): Thank you, Minister. I appreciate that I said it so fast that it would be hard to even understand what I was saying. My supplementary is: where the government last year amended laws as they apply to land tax to restrict exemptions to land used exclusively for charitable purposes, why has it not done the same for transfer duty?
Ms SYMES (Northern Victoria—Leader of the Government, Attorney-General, Minister for Emergency Services) (12:35): I will pass on Ms Patten’s further question to the Treasurer.
Fiona Patten MP
Leader of Reason
Member for Northern Metropolitan Region
Question without notice 23/3/22
Answer
A written response was ordered for both the substantive and supplementary questions. Written response received:
I thank Ms Patten, Member for the Northern Metropolitan region, for her questions. Land transfer duty is payable on most transactions that result in a change of ownership of land and associated real assets. Various exemptions and concessions are available, including an exemption for ‘charities and friendly societies’.
This exemption applies in respect of transfers to, and declarations over property to be held on trust for:
– a religious, charitable or educational purpose,
– a corporation or body of persons established for a religious, charitable or educational purpose,
– a friendly society.
For the period from 1 July 2017 to 31 January 2022, the estimated tax expenditure associated with the land transfer duty exemption for charities and friendly societies is $107 million. The State Revenue Office does not collect or record data at the subcategory level within the charities and friendly societies exemption.
The Land Tax Act 2005 (Vic) was amended in late 2021 to restore the longstanding policy intent that land must be both used and occupied by a charity exclusively for charitable purposes to qualify for exemption. The amendments respond directly to the decision of the Supreme Court of Victoria in The University of Melbourne v Commissioner of State Revenue [2021] VSC 156, which held the exemption (as previously framed) only required ‘use’ of the land by a charity but not occupation.
TIM PALLAS MP
Treasurer
28/3/2022