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A former petrol station in Balaclava was developed into an apartment complex. The taxpayer stated that the consideration for the purchase was $850,000 and paid duty on that amount.

The property was purchased as part of an ‘asset swap’ in which the taxpayer sold to BP Refinery (Bulwer Island) Pty Ltd (BP) two petrol stations and BP sold to the taxpayer two petrol stations.

The key issue was the correct dutiable value of one of the petrol stations acquired.

In February 2018, following an investigation and obtaining a valuation of $5 million (plus GST) from the Valuer-General’s nominated value, the Commissioner determined that the dutiable value of that petrol station was $5 million (plus GST) and not the consideration of $850,000 on which the taxpayer paid duty. The Commissioner therefore issued a reassessment for the additional duty and imposed a 90% penalty for concealment, concluding that the taxpayer had taken deliberate steps to prevent the Commissioner from becoming aware of the nature and extent of the tax default. The taxpayer objected relying on a $2.1 million valuation by its valuer. The two valuers used different valuation methodology.


On 4 March 2021, the Tribunal delivered a decision substantially in favour of the Commissioner,  accepting the methodology used by the Commissioner’s valuer and that the unencumbered value of the property was $5.5 million, inclusive of GST. As the taxpayer provided a valuation soon after the investigation started the Tribunal found there was no concealment and that the taxpayer neither hindered nor prevented the Commissioner from ascertaining the extent of the tax default. However,  the Tribunal did conclude that there was an intentional disregard of a taxation law justifying the imposition of a 70% penalty.  

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