A key cost factor in dealing with mining tenements is the stamp duty that applies when they are transferred. In May last year the New South Wales Parliament sought to amend the Duties Act 1997 (NSW) through the introduction of the State Revenue Legislation Amendment Bill 2013.
- While the State Revenue Legislation Amendment Bill (Bill) was introduced to Parliament some time ago resumption of its adjourned debate is due to occur at Parliament’s next sitting on 25 February. If the Bill is passed, it will amend the definition of ‘interests in land’ from mining leases and mineral claims to ‘a mining tenement’. The proposed new definition of ‘mining tenement’ is an expansion on the current definition of ‘interest in land’ as, in addition to a mining lease and a mineral claim, it also adds an assessment lease, exploration licence and an opal prospecting licence as an ‘interest in land’, all of which were previously specifically excluded from the definition of ‘interest in land’.
- The Bill will make expressly clear the position that a mining tenement is an interest in land for stamp duty purposes. This is important as an interest in land is dutiable property. Therefore a transfer of an interest in land subject to a mining tenement, or a transfer of a mining tenement itself will be subject to duty.
- Expand the definition of ‘dutiable value’ by amending the definition of ‘unencumbered value’ to include any information relating to the mining tenement. This means that a transaction involving a mining tenement will include any information relating to a mining tenement and as such, the dutiable value will more than likely increase.
- Companies with mining tenements in New South Wales who are proposing a transaction might benefit from re- considering the timing of completion of their transaction and from seeking formal legal advice as to their position.