North-West business Van Dairy's court battle over $20m tax claim

The North-West Coast dairy group is fighting in the Hobart Magistrates Court to quash additional stamp duty assessments by the Commissioner of State Revenue totalling $20 million.

According to the state, a series of share transfers between Mr Lu and various companies represented a change in ownership that had triggered the additional duty obligations.

Lawyers for Van Dairy argued that Mr Lu was not aware of some of the transactions at the time, and that they were internal restructures that did not alter the ultimate beneficial ownership of the affected company.

Earlier in the week, counsel for Van Dairy, Anthony Young KC, said one of the reasons the stamp duty assessments should be dismissed was because Mr Lu's signature had been affixed to a transfer certificate electronically by mistake by a China-based employee who did not understand the English language.

Mr Young said Mr Lu did not become aware of transfers until several years later, when the State Revenue Office presented new stamp duty claims against the company.

But counsel for the Commissioner of State Revenue, Philip Jackson SC, presented evidence that seemed to contradict that narrative.

Appearing in court via video link, Chinese-language translator, Weizhong Chen, said he had been asked to translate hand-written signatures on share transfer documents dating back to 2016, and had found that Mr Lu's signature was present on them.

In cross-examination, Mr Young questioned Mr Chen's credentials, and asked whether he had any training in forensic science.

Deputy Chief Magistrate, Michael Daly, later put a stop to the line of questioning, ruling that Mr Chen was not presenting as an expert witness on signatures, but rather as a translator.

Later, Mr Jackson questioned Van Dairy's claim that it was not a "land-rich" corporation under the definition of the Duties Act 2001.

Under that law, duties were imposed on acquisitions of some interests in land-rich corporations - meaning companies whose total assets are 60 per cent or more in land assets.

Companies controlled by Chinese-born businessman Xianfeng Lu purchased Van Diemens Land Company in 2016 for $280 million and paid $8 million to the state in duty at the time.

But Tasmanian tax collectors reopened an investigation several years later and hit the company, renamed Van Dairy, with a further $20 million stamp duty demand.

The company employs around 140 workers at its various Woolnorth properties, on the North-West Coast.

The magistrate will publish his decision at a later date.

Our journalists work hard to provide local, up-to-date news to the community. This is how you can continue to access our trusted content: