The Australian Competition and Consumer Commission has instituted legal proceedings in the Federal Court, Melbourne against a chartered accountancy firm and a principal over representations about the effect of the New Tax System on residential rents and water rates.
The ACCC alleges the firm, Rod Turner Consulting Pty Ltd, wrote to a client's tenant advising of a proposed rental increase. The ACCC alleges the letter stated that from 1 July 2000 an extra 10 per cent would be payable on rent charged by the landlord but the landlord was including a Goods and Services Tax component in the increased rent from 20 June 2000. It is also alleged that the firm represented that water rates for the rented premises would carry a GST cost to the landlord.
The ACCC alleges the statements in the letter amount to a false or misleading statement as to the price of services, namely rent for a residential unit. It has also alleged misleading and deceptive conduct because the supply of residential premises by way of lease is an input-taxed supply under the New Tax System legislation and therefore not a taxable supply for the purposes of the GST and also because water rates are GST-free.
The ACCC has taken civil action against Rod Turner Consulting under sections 52 and 53(e) of the Trade Practices Act 1974. The ACCC has also taken action against its principal, Mr Rod Turner, for being knowingly concerned in the alleged contraventions.
The ACCC seeks declarations that the conduct is unlawful, injunctions restraining the respondents from making similar statements, and orders that the respondents take corrective action and apologise to the tenant concerned.