Elizabeth Bishop SC and Ken Lord appeared for the Chief Commissioner in Hixson Pty Ltd v Chief Commissioner of State Revenue [2025] NSWSC 192. The Court upheld the Chief Commissioner’s assessments for surcharge land tax.

This is the first Supreme Court decision to address the rules for identifying a ‘foreign person’ under the NSW surcharge land tax provisions.

The matter concerned residential land under development in south-west Sydney. The owner was a company which was an indirect subsidiary of an Australian testamentary discretionary trust. At least one potential beneficiary of the trust was a person not resident in Australia and not an Australian citizen.

Hmelnitsky J held that under the rules for tracing ‘substantial interests’ in the Foreign Acquisitions and Takeovers Act 1975, the landowning company was a ‘foreign person’ for NSW surcharge land tax purposes. While a transitional exemption for Australian testamentary trusts may have applied to land owned by the trustees themselves, that exemption did not extend to land owned by any other entity. The assessments of surcharge land tax on the landowning company as a ‘foreign person’ were upheld.

His Honour also considered statutory construction principles and the limits on using explanatory notes and second reading speeches in identifying the purpose of amending legislation.

The judgment may be found here.