Fringe Benefits Tax Commercial Parking Station Appeal Allowed

Original Word Document (148.6 KB) Federal Court of Australia

Commissioner of Taxation v Toowoomba Regional Council [2026] FCAFC 50

| Appeal from: | Toowoomba Regional Council v Commissioner of Taxation [2025] FCA 161 | |

| File number: | QUD 131 of 2025 | |

| Judgment of: | MCELWAINE, FEUTRILL AND WHEATLEY JJ | |

| Date of judgment: | 27 April 2026 | |

| Catchwords: | TAXATION – Fringe Benefits Tax – meaning of commercial parking station at ss 39A and 136 of the Fringe Benefits Tax Asse ssment Act 1986 (Cth) – whether meaning is confined to facilities that are intended to or in fact operate profitably – appeal allowed – held profitable operation is not a necessary integer – commercial in this context means to engage in commerce | |

| Legislation: | Acts Interpretation Act 1901 (Cth) ss 13, 15AA, 15AB, 15AD

Fringe Benefits Tax Act 1986 (Cth)

Fringe Benefits Tax Assessment Act 1986 (Cth) Div 10A; ss 26, 27, 39A, 39C, 39D, 39DA, 42, 48, 49, 136

Income Tax Assessment Act 1997 (Cth) s 995-1

Taxation Administration Act 1953 (Cth) Pt IVC; Sch 1; ss 14ZY, 14ZZO, 357-110, 359-1, 359-5, 359-20, 359-60

Taxation Laws Amendment Act 1994 (Cth) Part 2, Div 3

Taxation Laws Amendment (Car Parking) Act 1992 (Cth) ss 39A, 39B, 39C, 39D, 39E, 136

Fringe Benefits Tax Regulations 1986 (Cth)

Taxation Laws Amendment Bill (No 4) 1993 (Cth)

Taxation Laws Amendment (Car Parking) Bill 1992 (Cth)

Explanatory Memorandum to the Taxation Laws Amendment (Car Parking) Bill 1992 (Cth)

Second Reading Speech (Commonwealth, Parliamentary Debates, House of Representatives, 2 May 1986)

Second Reading Speech (Commonwealth, Parliamentary Debates, House of Representatives, 4 November 1992) | |

| Cases cited: | Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27

Australian Trade Commission v WA Meat Exports Pty Ltd [1987] FCA 308; (1987) 75 ALR 287

Brooks v Federal Commissioner of Taxation [2000] FCA 721; (2000) 100 FCR 117

Cabell v Markham (1945) 148 F (2d) 737

CIC Insurance Ltd v Bankstown Football Club Ltd [1997] HCA 2; (1997) 187 CLR 384

Commissioner of Taxation v Eichmann [2019] FCA 2155

Commissioner of Taxation v Myer Emporium [1987] HCA 18; (1987) 163 CLR 199

Commissioner of Taxation v Qantas Airways Ltd [2014] FCAFC 168; (2014) 227 FCR 554

Eichmann v Commissioner of Taxation [2020] FCAFC 155; (2020) 280 FCR 10

Fairway Estates Pty Ltd v Commissioner of Taxation (Cth) [1970] HCA 29; (1970) 123 CLR 153

Federal Commissioner of Taxation (Cth) v Auctus Resources Pty Ltd (subject to deed of company arrangement) [2021] FCAFC 39; (2021) 284 FCR 294

Federal Commissioner of Taxation v BHP Billiton Ltd [2011] HCA 17; (2011) 244 CLR 325

Federal Commissioner of Taxation v Consolidated Media Holdings Pty Ltd [2012] HCA 55 ; (2012) 250 CLR 503

Harkness v Partnership Pacific Ltd (1997) 41 NSWLR 204

Hope v Bathurst City Council [1980] HCA 16; (1980) 144 CLR 1

Kelly v R [2004] HCA 12; (2004) 218 CLR 216

Lee v Evans (1964) 112 CLR 276

Mondelez Australia Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union [2020] HCA 29; (2020) 271 CLR 495

Quikfund (Australia) Pty Ltd v Airmark Consolidators Pty Ltd [2014] FCAFC 70; (2014) 222 FCR 13

Palmanova Pty Ltd v Commonwealth of Australia [2025] HCA 35; (2025) 99 ALJR 1362

PMT Partners Pty Ltd (in liq) v Australian National Parks and Wildlife Service [1995] HCA 36; (1995) 184 CLR 301

Professional Admin Services Centres Pty Ltd v Commissioner of Taxation [2013] FCA 1123

Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 335

R v A2 [2019] HCA 35; (2019) 269 CLR 507

R v Brown [1996] 1 AC 543

Re Bolton; Ex parte Beane [1987] HCA 12; (1987) 162 CLR 514

Residual Assco Group Ltd v Spalvins [2000] HCA 33; (2000) 202 CLR 629

Sea Shepherd Australia Ltd v Commissioner of Taxation [2013] FCAFC 68; (2013) 212 FCR 252

SkyCity Adelaide Pty Ltd v Treasurer of South Australia [2024] HCA 37; (2024) 419 ALR 361

Spencer v The Commonwealth (1907) 5 CLR 418

SZTAL v Minister for Immigration and Border Protection [2017] HCA 34; (2017) 262 CLR 362

Thiess v Collector of Customs [2014] HCA 12; (2014) 250 CLR 664

Toowoomba Regional Council v Commissioner of Taxation [2025] FCA 161; (2025) 122 ATR 53

Will v Brighton [2020] NSWCA 355; (2020) 104 NSWLR 170

Williams v Toyota Motor Corporation Australia Ltd [2024] HCA 38; (2024) 419 ALR 373

X v Australian Prudential Regulation Authority [2007] HCA 4; (2007) 226 CLR 630

XYZ v Commonwealth [2006] HCA 25; (2006) 227 CLR 532 | |
| Division: | General Division | |

| Registry: | Queensland | |

| National Practice Area: | Taxation | |

| Number of paragraphs: | 123 | |

| Date of last submissions: | 24 November 2025 (respondent)

2 December 2025 (appellant) | |

| Date of hearing: | 11 November 2025 | |

| Counsel for the Appellant: | Mr B J Sullivan SC with Ms C Raad and Ms N L Gollan | |

| Solicitor for the Appellant: | Australian Government Solicitor | |

| Counsel for the Respondent: | Mr D W Marks KC with Mr N P Hanna | |

| Solicitor for the Respondent: | Dentons | |
ORDERS

| QUD 131 of 2025 |

| BETWEEN: | COMMISSIONER OF TAXATION

Appellant | |
| AND: | TOOWOOMBA REGIONAL COUNCIL

Respondent | |

| order made by: | MCELWAINE, FEUTRILL AND WHEATLEY JJ |
| DATE OF ORDER: | 2 7 April 2026 |
THE COURT ORDERS THAT:

1. The appeal is allowed.

2. The orders numbered 1 to 3 as made on 6 February 2025 and the orders numbered 1 and 2 as made on 10 February 2025 in proceeding QUD 702 of 2024 are set aside, and in lieu of those orders it is ordered that:

(a) The applicant’s taxation appeal is dismissed; and

(b) The applicant is to pay the respondent’s costs.

1. Each party is to bear their own costs of the appeal.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

MCELWAINE AND WHEATLEY JJ:

introduction

1 The determinative issue in this appeal turns on a matter of statutory construction of s 39A of the Fringe Benefits Tax Assessment Act 1986 (Cth) (FBTA Act), in the context of a private ruling. Section 39A relates to car parking benefits within Part III of the FBTA Act which provides for what are included as fringe benefits.

2 Stripped of unnecessary detail, the Toowoomba Regional Council had sought a private binding ruling concerning the fringe benefits tax liability for car parking provided to its employees. The Council argued in the private ruling application that the car parking facilities provided at the Grand Central Toowoomba Shopping Centre (Grand Central Car Park) (being within one kilometre of the Council’s car park) was not a “commercial parking station” so as to engage one of the necessary integers of s 39A for there to be a car parking benefit. A “commercial parking station” the Council argued, and was accepted by the learned primary judge, were facilities confined to those that do or are capable of generating a profit.

3 The Commissioner of Taxation disagreed. In the private ruling the Commissioner determined that the Grand Central Car Park was a commercial parking station essentially because on the facts set out in the scheme ruling application, it is a purpose-built permanent complex designed for car parking where customers are charged more than a nominal fee for parking at variable rates, determined by the time a vehicle is parked, which is not on-street parking.

4 Being dissatisfied with the ruling, the Council lodged a notice of objection with the Commissioner, which was disallowed. The Council then filed a taxation appeal to this Court.

5 The primary judge upheld the Council’s appeal, set aside the Commissioner’s objection decision and in lieu thereof determined that the Grand Central Car Park is not a commercial parking station under s 39A: Toowoomba Regional Council v Commissioner of Taxation [2025] FCA 161; (2025) 122 ATR 53 (PJ).

6 The Commissioner appeals and relies on two grounds, that the primary judge erred: (1) in his construction of a “commercial parking station” in s 136; and (2) in finding as a fact that the Grand Central Car Park was being operated in a manner inconsistent with it being operated commercially for profit.

7 With respect to the very considerable experience and ability of the primary judge in revenue law, we have reached a different conclusion as to the meaning of the statutory text.

8 For the reasons that follow, the appeal must be allowed on the basis of ground (1). It is unnecessary to deal with ground (2) because of the acceptance of ground (1). We are satisfied that the primary judge erred in the construction of a “commercial parking station” (PJ [35]). It does not require an intention to make, or to be aimed at, a profit-making purpose. In the relevant statutory context, as explained below, the meaning of “commercial” is being engaged in or in the nature of commerce.

the private ruling

9 On 29 June 2023, the Council applied to the Commissioner for a private ruling under the Taxation Administration Act 1953 (Cth) (TAA).

10 The Council sought answers to the following questions, which the Commissioner provided as follows.

(1) Question 1

Is the Grand Central shopping centre parking facility considered “commercial”, for the purposes of being a “commercial parking station” under section 39A [of the FBTA Act]?

Answer

Yes

(2) Question 2

Notwithstanding whether Grand Central’s parking facility is considered a “commercial parking station”, would the lowest representative fee charged, with reference to Section 39A(1)(a)(iii), 39AA and 39AB of the [FBTA Act], be $7.50?

Answer

Yes

11 On 17 January 2024 the Council lodged a notice of objection against the Commissioner’s private ruling dated 21 November 2023. On 26 September 2024 the Commissioner disallowed the objection.

12 The Council filed the taxation appeal, which was heard and allowed by the primary judge. It was in the context of a private ruling. Private rulings are provided for in Division 359 of Schedule 1 of the TAA. The private ruling is an expression of the Commissioner’ opinion of the way in which the relevant provisions, under consideration, applies or would apply in relation to the specified scheme (the scheme being the specified facts, provided for the purposes of obtaining the Commissioner’s opinion: s 359-1 of the TAA).

13 As correctly (with respect) stated by the primary judge (PJ [8]-[9]), the relevant principles were helpfully enunciated by Derrington J in Commissioner of Taxation v Eichmann [2019] FCA 2155 at [22] which were not doubted by the Full Court (although the appeal allowed) but were added to in that the Tribunal or Court may draw inferences from the ruled facts which are obvious and where no other obvious competing inference might be drawn: Eichmann v Commissioner of Taxation [2020] FCAFC 155; (2020) 280 FCR 10 at [16].

14 Given the importance of the scheme, in the context of a private ruling, it is worth setting it out:

Relevant facts and circumstances

This private ruling is based on the facts and circumstances set out below. If your facts and circumstances are different from those set out below, this private ruling has no effect and you cannot rely on it. The fact sheet has more information about relying on your private ruling.

The Grand Central shopping centre is located on the corner of Margaret and Dent Street, in Toowoomba, Queensland.

There are multiple entrances to the Grand Central car park.

In November 2014, a $500 million redevelopment commenced. Upon completion in March 2017, it doubled the floor area to 90,000 square meters, and the number of car parking spaces to 4,000 (from 2,000).

Grand Central introduced paid car parking to the public on 14 June 2017. Parking rates at Grand Central are as follows:

• Up to 3 hours – Free

• Up to 3.5 hours - $2.00

• Up to 4 hours - $3.00

• Up to 4.5 hours - $4.00

• Up to 5 hours - $6.00

• Up to 5.5 hours - $8.00

• Up to 6 hours - $10.00

• Up to 6.5 hours - $12.00

• Up to 7 hours - $15.00

• Over 7 hours - $20.00 (Maximum daily rate).

In addition to free park when a car is parked for less than three hours, Grand Central offers reduced or free parking to its shoppers and staff in various other scenarios, including:

• Free parking after 6pm

• Free parking for disabled shoppers

• Free parking for shoppers that spend more than $150 at the centre

• Free parking for cinema patrons

• All day parking at a flat rate of $7.50 for the centre’s staff, and

• Customers that live outside Toowoomba and shop at Grand Central for more than three hours are provided with all day parking at a flat rate of $7.50.

The parking lots around the Toowoomba CBD are operated by the Toowoomba Regional Council. We note that the parking fees for these are as follows:

• Clifford Street: $1.90 per hour, maximum of $6 per day.

• Station Street: $1.90 per hour, maximum of $7.50 per day.

• Julia Street: $1.90 per hour, maximum of $7.50 per day.

• Chalk Drive: $1.90 per hour, maximum of $6 per day.

• Herries/Water Street: $1.90 per hour, maximum of $6 per day.

• Neil/Annand Street: $1.90 per hour, maximum of $9 per day.

The car parking threshold for the FBT year ended 31 March 2023 is $9.72

Grand Central has a ticketless parking system that uses licence plate recognition to track parking without the need for a paper ticket.

Upon exiting, customers will stop at the boom gates while the camera scans the license plate details and calculates the time spent and if any costs are incurred. If customers have been under 3 hours the boom gates will automatically open.

If customers have paid at the pay stations or scanned their validation bar code (from Customer Service, or the cinema ticket barcode) the boom gates will automatically open. If payment is required, a credit card can be scanned at the boom gates.

Payment machines are located at mall entrances and credit card payment can be accepted at the exit barriers.

reasoning of the Primary Judge

15 The primary judge accepted the Council’s construction submission that dictionary definitions provide a range of meanings for the adjective “commercial” at PJ [28]:

As used as an adjective, and as the Macquarie Dictionary instructs, “commercial” can mean “of or of the nature of commerce” or “engaged in commerce”, but it can also mean “capable of returning a profit”, with the illustration offered being its use in a description “a commercial project”. It may also mean “capable of being sold in great numbers”, with the offered illustration being is the invention commercial. Like meanings are to be found of the adjective “commercial” in the Oxford Dictionary. Reference to that informs one that the etymology of the word is found in classical Latin, “commercium”, meaning, as a noun, commerce. In turn, commerce can be nothing more than business or a trade.

16 From there his Honour found that there is “no doubt” that the Grand Central Car Park “is deployed in commerce”: PJ [29]. The Council does not by Notice of Contention challenge that finding.

17 His Honour next identified a constructional choice as between the dictionary meanings (PJ [29]) and settled on one (PJ [30]-[34]): being, capable of returning a profit (PJ [35]).

18 His Honour extensively referenced this Court’s decision in Commissioner of Taxation v Qantas Airways Ltd [2014] FCAFC 168; (2014) 227 FCR 554, Perram, Robertson and Davies JJ, where the issue concerned whether a nearby permanent commercial parking facility to the provision of employee parking by Qantas was restricted by the word “public” to persons commuting between their homes and their ordinary places of work. The Court rejected the submission that the public provision of car parking did not extend to parking by members of the public travelling to an airport in order to board an aircraft. The primary judge focussed attention on the reasoning at of the Full Court [12] where the Court was concerned with the taxable value of the car parking facilities provided by the employer, and not to the value in the hands of the employee. In part the Court in Qantas reasoned (at [12]):

… The condition that there be a commercial car parking station within a one kilometre radius of the employer’s business premises to constitute a car parking fringe benefit is not a proxy for the value of the benefit to the employee of receiving an actual parking space at the employer’s business premises, but a proxy for determining the taxable value of a benefit provided by the employer to an employee on which tax on the employer is imposed. …

19 The primary judge regarded the proxy for value reference as significant, reasoning at PJ [31] that:

The role of a proxy for value suggests that the proxy is meant to have a market-based role: commercial parking station, as opposed to a parking station that might be deployed in commerce but be completely uncommercial if viewed as a parking station alone in its operation.

20 From that premise his Honour, whilst regarding the position as “neutral” within the definition at s 136, considered that in context the reference to the lowest fee charged by the operator at s 39A(1)(a)(iii) to be a proxy for value by analogy with the reasoning in Qantas: PJ [33]. In that paragraph the primary judge reasoned in part:

It would be an odd proxy for value, if the commercial parking station concerned, were one which, although deployed in commerce, was not operated commercially in the sense of for the purpose of a profit. That is not to say that a profit must be present, only that there be some profit-making purpose to do with the operation of the car parking station. Affording the adjective “commercial” that meaning within the definition of “commercial” parking station, fits more neatly with context and purpose, and is an ordinary meaning of the adjective commercial open as a matter of ordinary English and use. I consider the definition does have an ambiguity about it, arising from different meanings that one might afford the adjective commercial, as indicated.

21 This led his Honour to the Explanatory Memorandum to the Taxation Laws Amendment (Car Parking) Bill 1992 (Cth) (1992 Bill) at PJ [34] where he identified as relevant the commentary to the definition of commercial car parking station. We extract the quoted text of the Explanatory Memorandum as there are inconsequential errors in the quotation at PJ [34]:

In relation to the definition of “commercial parking station”, the words “permanent” and “commercial” have their normal dictionary meanings. For example, a car park set up, for a short period to cater for a special function (like an Easter Show) would not be permanent. A car park which was not run with a view to making a profit (usually reflected in significantly lower car parking rates charged compared with the normal market value for that facility) would not be commercial.

Some car parking facilities have a primary purpose to provide short-term shopper parking. To discourage all-day parking, the operators of these facilities charge penalty rates for all-day parking. These rates are significantly greater than the rates that would be charged by a similar facility which encouraged all-day parking. For the purposes of these provisions, short-term shopper parking facilities, using penalty rates for all-day parking will not be treated as a “commercial parking station”.

22 The primary judge considered that this explanation offered support for concluding that what is required to trigger the taxation liability for car parking benefit is the existence of a facility “intended to make, or aimed at, or having the potential for financial success intended to make a profit”: PJ [35].

statutory construction

23 The principles of statutory construction are settled and well-understood. However, as this matter turns on a question of statutory construction it is worthwhile setting out the relevant principles. The starting point for construing a statutory provision is the text of the statute understood in context, whilst regard is had at the same time, to its statutory purpose: Palmanova Pty Ltd v Commonwealth of Australia [2025] HCA 35; (2025) 99 ALJR 1362 at 4; SZTAL v Minister for Immigration and Border Protection [2017] HCA 34; (2017) 262 CLR 362 at 14; Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 335 at [69]-70. In this sense, context is an inquiry made at this first stage and in its widest sense: CIC Insurance Ltd v Bankstown Football Club Ltd [1997] HCA 2; (1997) 187 CLR 384 at 408 (Brennan CJ, Dawson, Toohey and Gummow JJ); SZTAL at [14]; R v A2 [2019] HCA 35; (2019) 269 CLR 507 at 33 and 148; Palmanova at [5].

24 It is necessary to construe the provision in light of the relevant extrinsic materials and legislative history, that being the statutory purpose which the provision is designed to actually achieve: Palmanova at [4]. Extrinsic material may assist in understanding the context and in fixing the meaning of the statutory text: Palmanova at [6]. Such materials will illuminate the mischief which the statute is intended to remedy: R v A2 at [33] and [148]; CIC Insurance at 408. However, considerations drawn from the extrinsic materials cannot be relied on to displace the clear meaning of the text of the relevant provision: Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27 at 47: Federal Commissioner of Taxation v Consolidated Media Holdings Pty Ltd [2012] HCA 55; (2012) 250 CLR 503 at 39. Furthermore, such extrinsic materials cannot be substituted for the text of the statute: Consolidated Media at [39]. The construction which best achieves the purpose or object of the legislation is to be preferred: s 15AA of the Acts Interpretation Act 1901 (Cth).

25 As the issue involves a defined term it is well to observe that ordinarily statutory definitions are construed according to their ordinary meaning, read in context: PMT Partners Pty Ltd (in liq) v Australian National Parks and Wildlife Service [1995] HCA 36; (1995) 184 CLR 301 at 310, (Brennan CJ, Gaudron and McHugh JJ). Limitations and qualifications are not to be read into a statutory definition unless clearly required by its terms or its context: PMT Partners at 310; SkyCity Adelaide Pty Ltd v Treasurer of South Australia [2024] HCA 37; (2024) 419 ALR 361 at 32. There is no rule against construing the words of a definition by reference to the terms that those words define, it forms part of the context within which the definition must be construed: SkyCity at [32]. The interpretative principle is more nuanced and is not an inflexible rule of statutory construction: Federal Commissioner of Taxation (Cth) v Auctus Resources Pty Ltd (subject to deed of company arrangement) [2021] FCAFC 39; (2021) 284 FCR 294 at [58]-69, approved in SkyCity at [32]. The proper course is to read the words of the definition into the substantive enactment and construe the definition in the context of the substantive provision: Kelly v R [2004] HCA 12; (2004) 218 CLR 216 at 103; SkyCity at [32].

26 Finally, dictionaries can be useful, but appropriate caution needs to be observed in their use due to the obvious limitations: Federal Commissioner of Taxation v BHP Billiton Ltd [2011] HCA 17; (2011) 244 CLR 325 at 49; Thiess v Collector of Customs [2014] HCA 12; (2014) 250 CLR 644 at 23. Dictionaries will often supply a range of meanings, however no dictionary will provide guidance as to which of those meanings the legislature intended, that is the process of statutory construction which the Court must undertake: Wi ll v Brighton [2020] NSWCA 355; (2020) 104 NSWLR 170 at [52]-57.

Fringe benefits tax assessment act

Statutory Text and Context

27 The purpose of the FBTA Act is to provide for the assessment and collection of the tax imposed by the Fringe Benefits Tax Act 1986 (Cth), which imposes a tax in respect of the fringe benefits taxable amount of an employer for a year of tax. When the statute was introduced to Parliament in May 1986, the Treasurer Mr Keating, in the Second Reading Speech (Commonwealth, Parliamentary Debates, House of Representatives, 2 May 1986, p 3018), said the following regarding the policy of the cognate Bills, including:

This historical Bill introduces another major element of the tax reform package, a system for effectively taxing remuneration obtained as fringe benefits, the absence of which has allowed many thousands of Australians to escape their fair share of tax while adding their burden to the backs of their fellow taxpayers. This Bill deals with income taken as fringe benefits, the most rutted-in tax shelter and the most untouchable income of all. No previous government has had the courage to confront it. Entertainment, motorcars, free travel, subsidised housing etcetera have lifted the living standards of many Australians at the expense of everyone else. This Government has said that this unfairness must end.

28 At its time of introduction, the Bill for the FBTA Act did not contain provisions for car parking fringe benefits. That altered in 1992 on commencement of the Taxation Laws Amendment (Car Parking) Act 1992 (Cth) (1992 Amendment) which inserted Division 10A, including ss 39A to 39E and several new definitions at s 136 including all-day parking and commercial parking station. When these amendments were made Mr Baldwin, the Minister Assisting the Treasurer, in the Second Reading Speech (Commonwealth, Parliamentary Debates, House of Representatives, 4 November 1992, p 2624) in part said:

The Government finds it inequitable that some employees receive these car parking benefits in a tax exempt form while other employees, most of whom will not get a tax deduction for their parking costs, must pay for equivalent facilities out of their after tax income.

Accordingly, the Bill will amend the Fringe Benefits Tax Assessment Act 1986 to impose fringe benefits tax on certain car parking benefits received by employees. However, a benefit will only arise where a car used to commute from home to work is parked at or near the employee’s main workplace for more than four hours between the hours of 7.00 a.m. and 7.00 p.m.

…

Where the employer provides car parking facilities to an employee, the value of the benefit will be determined with the mechanism set out in the Budget Papers. That is, the value of the lowest cost all-day parking at a permanent commercial parking station available to the public within one kilometre of the employer-provided facilities.

To minimise concerns about any unintended impact of these measures, the Government has ensured that the Bill provides that the provision of certain parking facilities can be exempted by regulation. Such exemptions may include parking facilities provided by employers that are of a minimal value or parking facilities which would not normally be considered to be commercial parking station for the purposes of these measures.

29 Consistent with the principles of construction, this is necessary context for the relevant provisions. Much time was spent in argument before the primary judge and on this appeal on the text of the Explanatory Memorandum.

30 At the time of the 1992 Amendment, commercial parking station was defined as follows:

commercial parking station, means a permanent commercial car parking facility where any or all of the car parking spaces are available in the ordinary course of business to members of the public for all-day parking on payment of a fee.

31 The relevant part of the Explanatory Memorandum is referred to above at ], with reference to the PJ [34].

32 The definition of “commercial parking station”, amongst other matters, was amended by Part 2, Division 3 of the Taxation Laws Amendment Act 1994 (Cth) (1994 Amendment). It was amended to the current version of the definition, being (emphasis added to highlight the amendments):

“ commercial parking station ”, in relation to a particular day, means a permanent commercial car parking facility where any or all of the car parking spaces are available in the ordinary course of business to members of the public for all-day parking on that day on payment of a fee, but does not include a parking facility on a public street, road, lane, thoroughfare or footpath paid for by inserting money in a meter or by obtaining a voucher.

33 The 1994 Amendment at the commencement of Part 2, Division 3 provided the objects of the Division, which were to:

(a) ensure that a car parking benefit is valued only by reference to fees charged by commercial parking station operators during daylight hours; and

(b) exclude kerbside parking meters from being regarded as a commercial parking station.

34 Chapter 2 of the Explanatory Memorandum to the Taxation Laws Amendment Bill (No 4) 1993 (Cth), the precursor to the 1994 Amendment, outlines the purpose of the amendments which are focused on the two matters the subject of the objects in the 1994 Amendment. In relation to the second object, it is stated that (at [2.3]) “ A further consequence is that car parking in some non-CBD areas may be subject to FBT where there are k er b side parking meters.”

35 Part III of the FBTA Act provides for, in Subdivisions A of Divisions 2 to 11 for certain matters to constitute a benefit and by way of Subdivision A of Division 12 for residual benefits. The term “benefit” is very broadly defined (also incorporating the broad definition of “arrangement”) in s 136(1) of the FBTA Act. Section 6, at the commencement of Part III, Division 1 expressly provides that the provisions of that part do not limit the generality of the expression benefit. The term “fringe benefit” in s 136(1) also incorporates the definition of benefit.

36 The critical provision, s 39A may now be set out.

39A Car parking benefits

(1)    If the following conditions are satisfied in relation to a daylight period, or a combination of daylight periods, on a particular day:

(a)     during the period or periods, a car is parked on one or more premises of a person (the provider), where:

(i)    the premises, or each of the premises, on which the car is parked are business premises, or associated premises, of the provider; and

(ii)    a commercial parking station is located within a 1 km radius of the premises, or each of the premises, on which the car is parked; and

(iii)    the lowest fee charged by the operator of any such commercial parking station in the ordinary course of business to members of the public for all-day parking on the first business day of the FBT year is more than the carparking threshold;

(b)    the total duration of the period or periods exceeds 4 hours;

(c)    any of the following applies:

(i)    a car benefit relating to the car is provided on that day to an employee or an associate of an employee in respect of the employment of the employee;

(ii)    the car is owned by, or leased to, an employee or an associate of an employee at any time during the period or periods;

(iii)    the car is made available to an employee or an associate of an employee at any time during the period or periods by another person, where:

(A)    the other person is neither the employer of the employee nor an associate of the employer of the employee; and

(B)    the other person did not make the car available under an arrangement to which the employer of the employee, or an associate of the employer of the employee, is a party;

(d)    the provision of parking facilities for the car during the period or periods is in respect of the employment of the employee;

(e)    on that day, the employee has a primary place of employment;

(f)    during the period or periods, the car is parked at, or in the vicinity of, that primary place of employment;

(g)    on that day, the car is used in connection with travel by the employee between:

(i)    the place of residence of the employee; and

(ii)    that primary place of employment;

(h)    the provision of parking facilities for the car during the period or periods is not taken, under the regulations, to be excluded from this section;

(i)    the day is on or after 1 July 1993;

the provision of parking facilities for the car during the period or periods is taken to constitute a benefit provided by the provider to the employee or the associate of the employee in respect of the employment of the employee.

37 The defined term “commercial parking station” is also used in:

(a) sections 39A to s 39B which provide for car parking benefits in Subdivision A of Division 10A;

(b) sections 39C to 39GC, which provide for the taxable value of car parking fringe benefits in Subdivision B of Division 10A, how to calculate the value of certain car parking benefits using a statutory formula in Subdivision C of Division 10A, and the 12 week record keeping method in Subdivision D of Division 10A; and

(c) section 58GA which provides for an exemption.

Car Parking Benefits

38 There are several elements to satisfy the requirements of s 39A, however the only one in dispute is whether the Grand Central Car Park is a commercial parking station and more particularly what is the proper construction of commercial within the definition which provides for “ a permanent commercial car parking facility ” with particular attributes. There was no dispute raised as to whether the Grand Central Car Park was “permanent”, “available… to members of the public” or whether it was available for “all-day parking”.

39 The primary judge held that in this context commercial, for a commercial parking station meant one that is intended to make or aimed at or having potential for financial success intended to make a profit (PJ [35]). The Respondent supported the primary judge’s construction and reasoning process.

40 As detailed below, based on the following reasons, we have arrived at a different construction.

41 First, the statutory text. The defined term includes the word commercial which is then repeated in the definition as a permanent commercial car parking facility. The term commercial forms part of the text and context, within which the definition must be construed: SkyCity at [32].

42 The Macquarie Dictionary defines “commercial” as follows:

A djective 1. of, or of the nature of, commerce.

1. engaged in commerce.

2. capable of returning a profit: a commercial project.

3. capable of being sold in great numbers: is the invention commercial?

4. setting possible commercial return above artistic considerations.

5. preoccupied with profits or immediate gains.

6. not entirely or chemically pure: commercial soda.

7. (of a vehicle) used primarily for carrying goods for trade, or paying passengers.

8. Radio, TV financially dependent on revenue from advertising.

9. Music created specifically to appeal to the widest market.

– noun 11. Radio, TV an advertisement.

– commerciality … , noun

– commercially, adverb

43 Consistent with the observations from the authorities referred to above, the dictionary provides a range of meanings. The first two definitions provide broad meanings of being in the nature of or being engaged in commerce. Commerce in turn means simply the interchange of goods or services. The third definition provides that commercial means capable of returning a profit. It is the constructional choice between these two meanings of commercial which is the central question on this appeal.

44 The statutory text does not confine, in terms of economic success, the description of a permanent commercial car parking facility. Limitations and qualifications are not to be read into the definition unless clearly required by its terms or by the context: PMT Partners at 310. The statutory text in the definition is broadly cast where what is required is the identification of a facility with the physical attribute of permanent car parking spaces. Being permanent, the car parking spaces should be physically lasting, enduring, remaining unchanged and not temporary. It must be in circumstances of “ any or all ” of those car parking spaces being available in the ordinary course of business to members of the public, for all-day parking, on payment of a fee. To be within the terms of the definition “ any or all ” of the car parking spaces must be ready for use in the ordinary course of business. On this basis, even if one car parking space was ready and available for use in the ordinary course of business to members of the public for all-day parking on payment of a fee, that could satisfy the definition. The ability of the statutory definition to be satisfied on the basis that a single car parking space is available (with satisfaction of the remaining matters) tends against the commercial requirement being intended to make or be aimed at making a profit. It is doubtful that a single car parking space could be operated profitably.

45 The car parking spaces being available and ready for use in the ordinary course of business is a reference to those car parking spaces being available in that operator’s “ ordinary course of business ”, to provide car parking spaces, to members of the public for payment of a fee. The reference to being “in the ordinary course of business” might initially provide some support for the facility to be one that is to make or to be aimed at making a profit. In general, a business is carried on with a view to profit: Professional Admin Services Centres Pty Ltd v Commissioner of Taxation [2013] FCA 1123 at 39; Commissioner of Taxation v Myer Emporium [1987] HCA 18; (1987) 163 CLR 199 at 209-210 (Mason ACJ, Wilson, Brennan, Deane and Dawson JJ). However, the statutory text does not simply refer to “business”. The text of the definition does not inquire into the revenue of the facility, the operating expenses or profitability (or absence thereof), which are matters of internal management peculiar to and only capable of being known by the operator. Furthermore, there is no ability to ascertain such matters. The text is not expressed by reference to the commercial or economic success of the facility. The requirement of the car parking spaces being available in the ordinary course of business is directed towards such spaces being available to members of the public in the normal, day-to-day operations of a business, being a commercial endeavour. That is, having the characteristics of car parking spaces being available in a regular, business-like way (perhaps by way of signage, tickets, boom-gates, registration recognition, fees or fee structures and the like), but without the specific requirement of inquiring into the revenue or returns. This is also supported by the text requiring that such car parking spaces be available on payment of a fee. These are the controlling characteristics which inform what is meant by the introductory adjective, commercial.

46 The statutory text then requires that such car parking spaces are available to members of the public (given an ordinary meaning), indicating that the car parking is not meant to be limited or restricted to a particular cohort of people, say to persons commuting between their homes and their ordinary place of work: Qantas at [12]-[14] and [20]-[22]. In this context, members of the public would carry its usual meaning being members of the community at large, in aggregate and the public generally, not one which is restricted or selective: Lee v Evans (1964) 112 CLR 276 at 283 and 285-286 (Barwick CJ), at 286 (Kitto J, with whom Owen J agreed), at 290 (Taylor J).

47 The text of the definition, then requires that the parking be available for all-day parking, which is defined as follows:

“all-day parking”, in relation to a particular day, means parking of a single car for a continuous period of 6 hours or more during a daylight period on that day.

48 Then the car parking facility must be available on the payment of a fee. That would require a sum to be paid in exchange for the occupation of the car parking space. However, that cannot be by way of inserting money in a parking meter or by obtaining a voucher. These matters are directed towards the car parking facility being engaged in commerce, however, there remains an absence of matters which would require or permit the calculation of returns or profitability.

49 The statutory text of the definition is directed towards first, a physical characterisation of permanent car parking spaces with at least one space being available generally to members of the public. Second, that the facility is operated on an arm’s length, independent, market basis, where the car parking spaces must be paid for with money. Third, the spaces must be available during daylight hours, for at least 6 hours. Fourth, it will not include parking on a public street, road or lane which is paid for by inserting money into a meter or by way of a voucher.

50 The matters relating to the commercial character of the car parking facility, from the statutory definition, support a general commercial undertaking, but not requiring that next level of specificity that the facility be operated to make or be aimed at making a profit. Parliament did not in the choice of language confine a commercial car parking station to that definition of commercial.

51 Further textual matters can be taken from the provisions which use the term commercial parking station. Section 39A of the FBTA Act uses the defined term commercial parking station in s 39A(1)(a)(ii) and in (iii), as part of ascertaining whether a car parking benefit is provided. The reference in s 39A(1)(a)(ii) is to satisfy a geographical requirement of it being within one kilometre of the comparison car parking provided by the employer. The reference in s 39A(1)(a)(iii) is to satisfy a financial threshold. Reading in the definition of commercial parking station into each of s 39A(1)(a)(ii) and (iii) (Kelly at [103]) reinforces the construction of commercial means to be engaged in commerce because the location is made a relevant criteria. The location is not a financial or economic criteria. The second aspect is a financial matter, requiring that the lowest fee charged must be more than the car parking threshold. The carparking threshold is provided for in s 39A(2), which is a dollar value at a particular point in time or is an amount which is capable of being calculated. By only requiring the fee to be charged by the commercial parking station to be more than the threshold, that does not direct attention to profitability, but it does support the characterisation of being engaged in commerce.

52 Division 10A of the Act operates on the fact of the provision of car parking benefits where the cumulative prescriptive requirements of s 39A are satisfied. Section 39B assists to understand when a commercial parking station is located within a one km radius (see s 39A(1)(ii) of the FBTA Act). The provisions in Division 10A are concerned with when a benefit is provided by an employer to an employee and to ascertain the taxable value of that benefit. The text of the provisions are not focused upon whether a particular car parking facility operates a profitable operation.

53 The scheme of the Act requires the employer to calculate the taxable value of car parking fringe benefits by one of three methodologies. First, s 39C, within Subdivision B of Division 10A, provides for the taxable value of the car parking fringe benefits using the commercial parking station method. It is referrable to the lowest fee charged by the operator of that parking station, in the ordinary course of business to members of the public. It does not refer to or require as part of the calculation, the overall revenue of the parking station or expenses, but simply the lowest fee charged.

54 The second is the market value basis at s 39D, which requires determination of the amount the recipient of the benefit “could reasonably be expected to have been required to pay the provider in respect of the provision of the benefit if it were assumed that the provider and the recipient were dealing with each other at arm’s length”. This requires an independent assessment by a suitably qualified valuer: s 39D(3). The valuation is of the fringe benefits, it does not inquire into the profitability of the comparison car parking facility.

55 The third is the average cost method at s 39DA, by which the employer may elect to calculate the taxable value by application of a formula where the integers to the calculation require identification of the “lowest fee charged in the ordinary course of business to members of the public for all-day parking by any operator of a commercial parking station located within a 1 km radius of any of the relevant parking premises on the day on which a car parking benefit is first provided in that FBT year in relation to the employer in connection with any of those premises”.

56 Finally, by way of textual consideration is how the FBTA Act defines a benefit and a fringe benefit. A car parking fringe benefit means a fringe benefit that is a car parking benefit (s 136(1) FBTA Act). The evident intent behind such broad definitions, in the context of the FBTA Act, is that it is not meant to be given a narrow or confined construction. This is not to unduly expand on the language that is used, but is to recognise the approach of the legislature.

57 Second, the context and purpose. The purpose of the introduction of the FBTA Act was as stated by the Treasurer and during the Second Reading Speech, to implement a greater level of fairness as between employees. Relevantly, such a purpose is not directed to the operator of the comparison commercial car parking facility, other than it having some commercial characteristic. The purpose of these provisions is to identify when a benefit (being a car parking benefit) is provided by an employer to an employee and to ascertain the taxable values of those benefits.

58 By way of context the Second Reading Speeches are against a restrictive interpretation. Parliament intended to and did cast the net widely to address identified inequity in the provision of previously non-taxable benefits to employees. The focus of the provisions is on identification of a commercial car parking facility within a one kilometre radius where the employer provides a car parking benefit to an employee. The express purpose of the 1992 Amendment was to calculate the value of the benefit by reference to the lowest cost all-day parking available to members of the public. That is the cost to the public, not the cost to the operator of the facility and therefore not whether it is profitable.

59 In relation to the Explanatory Memorandum, it explained that the words “permanent” and “commercial” were to have the ordinary dictionary meanings. Appropriate caution needs to be exercised when using dictionary definitions. The dictionary may provide a range of meanings, but it does not relieve the Court of the process of construction. However, in the commencement of the Macquarie Dictionary it explains that generally the most common meaning is put first. So contextually, the Explanatory Memorandum explains that the words have their normal dictionary meaning and the most common meaning is listed first. It is unnecessary to set out the meaning of permanent, there was no issue as between the parties as to its meaning. The first two meanings of commercial from the Macquarie Dictionary (above at ]), being the most common meanings support a meaning of being in the nature of or engaged in commerce.

60 The Explanatory Memorandum, then provides examples. If examples had been used in the Act itself, such examples would not be exhaustive and may extend the operation of the provision: s 15AD of the Acts Interpretation Act 1901 (Cth). An example in an Act, is just that, an example and is not meant to be exhaustive of cases which might fall within the section: Brooks v Federal Commissioner of Taxation [2000] FCA 721; (2000) 100 FCR 117 at 66. Examples in Explanatory Memoranda are to be approached with caution: Sea Shepherd Australia Ltd v Commissioner of Taxation [2013] FCAFC 68; (2013) 212 FCR 252 at 5. Extrinsic materials cannot be substituted for the text of the statute; Consolidated Media at [39]. Further the extrinsic materials cannot displace the clear meaning of the text of the provision: Alcan at [47]. In relation to the example given of a car park not run with a view to a profit, usually reflected by the lower car parking rates than those of the market, it concludes that would not be commercial. However, it is the indicia of not reflecting the market which would mean it falls outside the scope of being commercial. Further, such an indicia would be objectively apparent. Therefore, providing an example that a car parking facility which is not run with a view to a profit would not be commercial, does not define or confine the statutory text. A broader construction of commercial would still encompass the example given as a facility which is not run with a view to a profit, may or may not be commercial. However, on the broader construction, it is not the “view to a profit” which is the determinative criteria.

61 The Explanatory Memorandum is also internally inconsistent (above at ]). It commences with a statement, consistently with a wide net intended to be cast as described in the Second Reading Speech, that the definition is intended to have its normal dictionary meaning. Then, inconsistently, there is the reference by way of another example to “some car parking facilities” which have as their “primary purpose” the provision of “short-term shopper parking” with the justification that such facilities will not be treated as a commercial parking station because the rates charged “are significantly greater than the rates that would be charged by a similar facility which encouraged all-day parking”. To the extent that anomalous facilities may exist within the one kilometre radius, Parliament intended to address these by Regulation (see, ss 39A(1)(h) and 135 of the FBTA Act) and not by the device of controlling the otherwise broad reach of the 1992 Amendment. As we have explained, on the plain drafting of the provisions what is or is not a commercial parking station is a matter of objective determination. Parliament manifested an intention to widen the FBT net by focusing on any commercial parking station, not limited to profitable operations. The Minister emphasised the wide intended application of the amendments to address the identified inequity that some taxpayers were in receipt of tax free benefits, whereas others were required to meet the cost of car parking from after-tax income. That purpose is reflected in the statutory text, particularly the meaning of benefit and fringe benefit. Accordingly, the Explanatory Memorandum cannot be deployed to displace the clear meaning of the text: Alcan at [47]; Mondelez Australia Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union [2020] HCA 29; (2020) 271 CLR 495 at [69]-[73], (Gageler J).

62 The 1994 Amendment introduced further text to the definition of commercial parking station. That amendment was directed towards two main purposes, the first being that the car parking benefit was only valued by fees charged during daylight hours. The second being to ensure that kerb side parking meter parking was not to be regarded as a commercial parking station. The natural implication, is that such parking was within the terms of the definition, prior to the 1994 Amendment. Such kerb side parking payable by way of a parking meter is unlikely to be operating at a profit but would be commercial in the sense of being engaged in commerce.

63 Lastly, in terms of contextual consideration, it could not be known by the employer in each FBT year, save in the most unusual of circumstances, whether a commercial car parking station within the one kilometre radius is or is not conducted profitably or with a view to profit for the purposes of undertaking these calculations. These provisions identify and operate upon objectively determinable facts by reference to information that is publicly available: the actual fees that are charged, the market value as determined by an expert valuation (where comparable charges will form the basis of the opinion) or the average of actual cost. The profitability construction of the primary judge cannot be reconciled with these provisions.

64 In relation to the proxy value reasoning of the primary judge at PJ [29]-[33] by reference to Qantas, it must be recalled that the issue in Qantas was a different question of construction to that which concerns this Court in this appeal. There is nothing in the reasoning in Qantas which supports the narrow interpretation of commercial parking station, as being one aimed at or having the intention to make a profit.

Conclusion

65 For these reasons, ground 1 succeeds. It is unnecessary to address ground 2. The primary judge found at PJ [29] that, on the facts as exposed by the scheme, “there is no doubt” that the car park “is deployed in commerce”. The Council does not by notice of contention challenge that finding. It follows that having resolved the construction question, the appeal must be allowed and the orders sought by the Commissioner should be made, save that the Commissioner does not now press an order for the costs of the appeal.

| I certify that the preceding sixty-five (65) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justices McElwaine and Wheatley. |
Associate:

Dated: 27 April 2026

REASONS FOR JUDGMENT

FEUTRILL J:

Introduction

66 The principal issue for determination in this appeal is the meaning of the expression ‘permanent commercial car parking facility’ within the definition of ‘commercial parking station’ in s 136(1) of the Fringe Benefits Tax Assessment Act 1986 (Cth). Depending upon the resolution of that issue, the second issue for determination is whether the Grand Central car parking facility in Toowoomba in the State of Queensland is a ‘commercial parking station’ based upon the scheme described in a private ruling the taxpayer obtained from the Commissioner under the Taxation Administration Act 1953 (Cth).

67 I have had the advantage of reading the joint reasons of McElwaine and Wheatley JJ in draft. I agree that the appeal should be allowed and that orders should be made in the terms their Honours propose. However, for the reasons that follow, I arrive at that conclusion via a different route.

Private ruling legislative scheme

68 The Commissioner may, on application, make a written ruling on the way in which the Commissioner considers a relevant provision applies or would apply to a specified scheme. Such a ruling is called a private ruling: Sch 1 s 359-5 of the Taxation Administration Act. A private ruling must state that it is a private ruling and must identify the entity to whom it applies and specify the relevant scheme and the relevant provision to which it relates: Sch 1 s 359-20. Subject to affording procedural fairness before making the ruling, if the Commissioner considers that the correctness of a private ruling would depend on an assumption made about a future event or other matter the Commissioner may make such of the assumptions as the Commissioner considers appropriate: Sch 1 s 357-110. The term ‘scheme’ is defined in s 995-1 of the Income Tax Assessment Act 1997 (Cth) to mean any arrangement (also defined separately in terms that are not necessary to set out) or any scheme, plan, proposal, action, course of action or course of conduct, whether unilateral or otherwise.

69 A taxpayer may object against a private ruling in the manner set out in Pt IVC of the Taxation Administration Act: Sch 1 s 359-60. If a taxation objection is lodged with the Commissioner within the required period the Commissioner must decide whether to allow it, wholly or in part, or disallow it: s 14ZY. A taxpayer dissatisfied with the Commissioner’s objection decision may appeal to this Court in its original jurisdiction from that decision: s 14ZZ(1). In an appeal under s 14ZZ to the Court, the taxpayer has the burden of proving that the Commissioner’s objection decision should not have been made or should have been made differently: s 14ZZO(b)(ii).

70 As observed in the joint reasons, the primary judge correctly adopted the summary of the private ruling scheme that Derrington J made in Commissioner of Taxation v Eichmann [2019] FCA 2155 at [22]: PJ [8]. Paraphrased, with citations omitted, that summary is as follows.

(1) A private ruling is a statutory advisory opinion as to how the tax legislation would apply to a person in respect of an income year in relation to a specified ‘scheme’.

(2) When reviewing an objection decision in respect of a private ruling the Court (or, where applicable, the Administrative Review Tribunal) is reviewing the correctness of an opinion as to a question of law, and must form its own view of how the taxation law applies to the scheme as identified by the Commissioner in the ruling.

(3) The limitations on the right to object to the ruling in the Taxation Administration Act have the consequence that on review or appeal the Court (or Tribunal) is not entitled to redefine the scheme stated by the Commissioner in the ruling but must ascertain how the law applied to the facts as stated.

(4) The Court (or Tribunal) is not entitled to engage in the finding of primary facts. The facts stated by the Commissioner in the scheme form the matrix in which a ruling is made about how the tax laws apply in that scenario. The Court (or Tribunal) is not entitled to add to those facts and, in its determination, it cannot travel beyond them. It is not its role to investigate the facts nor ascertain whether they conform to the true facts. Indeed, the facts stated by the Commissioner in the ruling are not facts found or accepted by the Commissioner.

(5) On review neither the Commissioner nor the taxpayer can make good any deficiency in the description of the scheme. The Court (or Tribunal) cannot make its own findings of fact, make assumptions, re-define the scheme or create its own description of the scheme.

(6) The question for the Court (or Tribunal) is whether the Commissioner’s opinion as to the application of the taxation laws to the arrangement or scheme is correct. Its responsibility is to go over again the objection decision and determine, for itself, how the taxation laws are to apply.

(7) In that way, the only material relevant to the Court’s (or Tribunal’s) decision is the ruling and any documents identified in the description of the scheme which were provided by the taxpayer or used by the Commissioner.

71 Although an appeal was allowed, the Full Court evidently accepted the accuracy of the above summary subject to the qualification that, while, generally speaking, the Court has no jurisdiction (and the Tribunal no power) to make inferences of fact which supplement the ruled facts, the Court (or Tribunal) may draw inferences from ruled facts that are both obvious in nature and where there are no other possible competing inferences that might be drawn: Eichmann v Commissioner of Taxation [2020] FCAFC 155; (2020) 280 FCR 10 at 16. The primary judge also correctly identified and adopted that qualification: PJ [9]-[11], [40].

Primary judge’s reasons

72 The primary judge identified the ruled facts and the scheme the Commissioner specified in his ruling in this case: PJ [12]. As the scheme is set out in the joint reasons, it need not be restated.

73 The relevant issue before the primary judge was whether, upon the ruled facts set out in the scheme, the Grand Central car parking facility is a ‘permanent commercial car parking facility’ and, thereby, fell within the meaning of the expression ‘commercial parking station’ in s 39A(1) of the FBT Assessment Act. The primary judge construed ‘commercial’ in the expression ‘permanent commercial car parking facility’ to mean ‘is intended to make, or aimed at, or having the potential for financial success intended to make a profit’: PJ [35]. The primary judge also inferred from the ruled facts that ‘considered as a car parking facility alone, the range of free parking is inconsistent with it being operated commercially for profit, as opposed to commercially in the context of a shopping centre, not a standalone car parking facility’. Accordingly, the primary judge concluded that the Grand Central car parking facility was not a commercial parking station: PJ [41]-[44].

74 The Commissioner contends that the primary judge’s construction is erroneous and ‘commercial’ relevantly encompasses facilities that are ‘engaged in commerce’. As the primary judge found that the Grand Central car parking facility was ‘deployed in commerce’ (PJ [29]), his Honour ought to have concluded that the facility was a ‘commercial parking station’. Further and alternatively, the Commissioner contends that the primary judge was in error for inferring from the ruled facts that the Grand Central car parking facility was operated in a manner inconsistent with it being intended to make a profit or having the potential to make a profit.

75 The parties approached the appeal on the footing that there is a binary choice between the primary judge’s construction of ‘permanent commercial car parking facility’ and the Commissioner’s construction of that expression. Upon that supposition, if the Commissioner’s construction prevails, the appeal must succeed because the Grand Central car parking facility was manifestly deployed in commerce. However, if the primary judge’s construction prevails, for the appeal to succeed, the Commissioner must also succeed in demonstrating the primary judge erred in drawing an inference of the absence of a profit motive from the ruled facts.

76 The statutory meaning of ‘permanent commercial car parking facility’ is a question of law. The Court is duty bound to declare the proper construction of the legislation irrespective of the parties’ contentions. Therefore, there is a third possibility; namely, that neither the Commissioner’s nor the primary judge’s construction is correct. In that case, although error would be demonstrated, the extent to which the primary judge’s judgment was incorrect would depend upon whether, on the proper construction of ‘permanent commercial car parking facility’ and the ruled facts, the Grand Central car parking facility is a ‘commercial parking station’. Having regard to the nature of private rulings and taxation appeals, this Court is in as good a position as the primary judge to reach a conclusion on that question whatever may be the true construction of the legislation.

77 It follows that there are two issues in the appeal. First, what is the meaning of ‘permanent commercial car parking facility’ within the definition of ‘commercial parking station’? Second, is the Grand Central car parking facility a commercial parking station upon the facts of the scheme set out in the Commissioner’s private ruling?

What is the meaning of ‘permanent commercial car parking facility’?

78 I agree with McElwaine and Wheatley JJ that the primary judge’s construction of ‘commercial’ in the expression ‘permanent commercial car parking facility’ was incorrect. However, for the reasons that follow, I also do not consider that ‘commercial’ relevantly means, as the Commissioner contends, ‘engaged in commerce’ or ‘deployed in commerce’.

Applicable principles of statutory interpretation

79 The applicable principles of statutory interpretation are set out in the joint reasons and I gratefully adopt their Honours’ summary of those principles. For the purposes of these reasons, I need only add the following observations.

80 As is evident from the summary of the principles in the joint reasons, statutory interpretation involves attribution of meaning to legislative text. The High Court has stated on many occasions the task of statutory interpretation starts and finishes with a consideration of the legislative text. But, importantly, the text must be considered in its context: Federal Commissioner of Taxation v Consolidated Media Holdings Ltd [2012] HCA 55; (2012) 250 CLR 503 at 39. The modern approach to statutory interpretation insists that context, in its widest sense to include such things as the existing state of the law and the mischief which the statute was intended to remedy, be considered in the first instance not merely when ambiguity might be thought to arise: CIC Insurance Ltd v Bankstown Football Club Ltd [1997] HCA 2; (1997) 187 CLR 384 at 408 (Brennan CJ, Dawson, Toohey and Gummow JJ).

81 As the task of statutory interpretation is to construe the legislation, not individual words of its text, dictionary definitions of individual words used in the text are of limited assistance in the task of statutory interpretation. ‘The meaning attributed to individual words in a phrase ultimately dictates the effect or construction that one gives to the phrase when taken as a whole and the approach that one adopts in determining the meaning of the individual words of that phrase is bound up in the syntactical construction of the phrase in question.’ Thus, the notions of meaning and construction are interdependent. Therefore, it is an error to construe a composite phrase or expression by dividing the phrase and giving separate meaning to each word. That is not the way that language works. The significance of individual words is affected by other words and the syntax of the whole: Collector of Customs v Agfa-Gevaert Ltd [1996] HCA 36; (1996) 186 CLR 389 at 396-397 (Brennan CJ, Dawson, Toohey, Gaudron and McHugh JJ), citing R v Brown [1996] 1 AC 543 at 561 (Lord Hoffman); XYZ v Commonwealth [2006] HCA 25; (2006) 227 CLR 532 at 19, 102. By way of example, as Gleeson CJ observed in XYZ (at [19]), in the law of defamation ‘public interest’ does not mean ‘of interest to the public’ and there are many instances where it is misleading to construe a composite phrase simply by combining dictionary meanings of its component parts. More recently, Gordon ACJ and Beech-Jones J reiterated that ‘construing a composite phrase simply by combining the dictionary meanings of its component parts’ ‘may be misleading’: Taylor v Killer Queen LLC [2026] HCA 5 at [97] citing XYZ at [19] and Sea Shepherd Australia Ltd v Commissioner of Taxation [2013] FCAFC 68; 212 FCR 252 at 34.

82 Likewise, the necessity to construe legislative text purposively and in context renders dictionary meanings of individual words of little utility. As the High Court observed in Thiess v Collector of Customs [2014] HCA 12; (2014) 250 CLR 664 at 23:

… it is one of the surest indexes of a mature and developed jurisprudence not to make a fortress out of the dictionary; but to remember that statutes always have some purpose or object to accomplish, whose sympathetic and imaginative discovery is the surest guide to their meaning.

Citing Cabell v Markham (1945) 148 F (2d) 737 at 739 (Learned Hand J), quoted in Residual Assco Group Ltd v Spalvins [2000] HCA 33; (2000) 202 CLR 629 at 27.

Fringe benefits tax

83 Fringe benefits tax is a tax payable by employers on the value of certain benefits provided to employees in respect of their employment. The tax is imposed under the Fringe Benefits Tax Act 1986 (Cth) in respect of the taxable amount of fringe benefits of an employer of a year of tax. The taxable amount of fringe benefits payable by an employer is assessed under the Fringe Benefits Tax Assessment Act 1986 (Cth) and Fringe Benefits Tax Assessment Regulations 2018 (Cth). The FBT Assessment Act is incorporated into and is to be read as one with the FBT Act: s 3 of the FBT Act.

84 A benefit that is taxable under the FBT Act and FBT Assessment Act is not subject to income tax. In general, monetary remuneration paid to employees is subject to income tax and non-monetary benefits are subject to FBT. An employer is able to claim expenses incurred paying remuneration or providing non-monetary benefits to employees as deductions from the employer’s assessable income for the purposes of income tax. In the absence of FBT the value of non-monetary benefits employers provide to employees would not raise taxation revenue. Therefore, FBT is a taxation integrity and consistency measure that ensures that the value of non-pecuniary remuneration of employees is taxed, in effect, as if it were received as pecuniary remuneration except that the burden of the tax is borne by the employer and not the employee.

85 The definition of the term ‘fringe benefit’ starts with a broad concept, in effect, of any non-pecuniary benefit an employer provides to an employee and then narrows the meaning with numerous exceptions to the concept: s 136(1). The scheme of the FBT Assessment Act involves identifying a number of specific categories of fringe benefit and a general category referred to as residual fringe benefits. Each category has specific methods for determining the value of the benefit and, therefore, the amount that is subject to FBT. In certain categories, an employer can elect to use a different prescribed method for that category. Within the general scheme there are numerous idiosyncrasies that result in exclusions for small businesses and certain benefits that would otherwise be fringe benefits and taxable. Broadly, the FBT Assessment Act has two objects: (1) to identify the circumstance in which a taxable fringe benefit is provided; and (2) to prescribe a method for determining the taxable value in monetary terms of the non-pecuniary benefit provided.

86 When fringe benefits tax was introduced in 1986 car parking benefits provided to employees were specifically excluded. That position was changed with enactment of the Taxation Laws Amendment (Car Parking) Act 1992 (Cth). That amending Act inserted Div 10A into the FBT Assessment Act and new definitions associated with the provisions of that part of the amended FBT Assessment Act. Some modifications were made to Div 10A and applicable definitions with the enactment of the Taxation Laws Amendment Act 1994 (Cth). The amendments and relevant extrinsic materials are set out and summarised in the joint reasons and need not be restated.

Car parking fringe benefits

87 Consistently with the general scheme of the FBT Assessment Act, Div 10A identifies the provision of certain parking facilities as a fringe benefit in Subdiv A (car parking fringe benefit) and prescribes methods for determining the taxable value of car parking fringe benefits in Subdiv B (taxable value).

88 Section 39A of the FBT Assessment Act describes a number of elements that are preconditions to the existence of a car parking fringe benefit. Central to the issues raised in the appeal are the following elements described in s 39A(1) as follows:

(1)    If the following conditions are satisfied in relation to a daylight period, or a combination of daylight periods, on a particular day:

(a)    during the period or periods, a car is parked on one or more premises of a person (the provider), where:

(i)    the premises, or each of the premises, on which the car is parked are business premises, or associated premises, of the provider; and

(ii)    a commercial parking station is located within a 1 km radius of the premises, or each of the premises, on which the car is parked; and

(iii)    the lowest fee charged by the operator of any such commercial parking station in the ordinary course of business to members of the public for all-day parking on the first business day of the FBT year is more than the car parking threshold;

(b)    the total duration of the period or periods exceeds 4 hours;

…

the provision of parking facilities for the car during the period or periods is taken to constitute a benefit provided by the provider to the employee or the associate of the employee in respect of the employment of the employee.

89 There are three ways of calculating the taxable value of car parking benefits described in Subdiv B: the commercial parking station method: s 39C; market value basis: s 39D; and average cost method: s 39DA. An employer may elect to use the market value basis or average cost method, otherwise the default is the commercial parking station method.

90 The elements in s 39A(1)(a)(ii) and s 39A(1)(a)(iii) that are preconditions for the existence of a car parking fringe benefit are also key features of the commercial parking station method and average cost method for assessing the taxable value of that benefit. The taxable value in each of these methods starts with the lowest fee charged by an operator of a commercial parking station located within a 1 km radius of any of the relevant premises in the ordinary course of business to members of the public for all-day parking. Otherwise, in the case of the market value basis, the taxable value is determined by reference to an arm’s length transaction.

91 The term ‘commercial parking station’ is defined (with the text of other defined terms included) in s 136(1) of the FBT Assessment Act as follows:

commercial parking station, in relation to a particular day, means a permanent commercial car parking facility where any or all of the car parking spaces are available in the ordinary course of business to members of the public for all-day parking [parking of a single car for a continuous period of 6 hours or more during a daylight period (so much of a period as occurs after 7am and before 7pm)] on that day on payment of a fee, but does not include a parking facility on a public street, road, lane, thoroughfare or footpath paid for by inserting money in a meter or by obtaining a voucher.

92 The expression ‘permanent commercial car parking facility’ is not separately defined. As the primary judge observed, with respect correctly, the clause that follows that expression does not define the content of what is or is not a permanent commercial car parking facility. Rather, that clause narrows the kind of permanent commercial car parking facility that falls within the meaning of the term ‘commercial parking station’: PJ [27]. It may be added that there are two elements to the narrowing clause. The first prefaced by ‘where’ identifies features a ‘permanent commercial parking facility’ must have to fall within the definition of a ‘commercial parking station’. The second, prefaced by ‘but does not include’ then further narrows the class of permanent commercial parking facility that falls within the meaning of the defined term. The two elements of the narrowing clause reflect the original amendment that inserted the defined term into the FBT Assessment Act in 1992 and the subsequent amendment to that definition in 1994.

93 Relevantly, ‘commercial parking station’ is defined by reference to a ‘permanent commercial car parking facility’ with certain characteristics but that is not metered street parking. However, the meaning of the composite phrase ‘permanent commercial car parking facility’ is not to be found by focussing on the word ‘commercial’ and selecting one of the possible dictionary meanings of that word taken from the Macquarie Dictionary or Oxford Dictionary. Nor is the meaning of the phrase to be found in the Latin etymology of the word ‘commercial’. The composite expression is a noun-phrase that describes something that is of relevance to determining the existence of a car parking benefit and then assessing the taxable value of that benefit.

94 In my view, the proper construction of the phrase ‘permanent commercial car parking facility’ in context means a permanent car parking facility at which fees are paid in exchange for licenses to use car parking spaces in amounts agreed between a licensor and a licensee dealing with each other at arm’s length. It is a facility where it can be presumed that the licensor and licensee has each made the best possible bargain in the circumstances for the provision and use of car parking spaces. That is, the fees charged for car parking spaces can be presumed to be representative of the market value for a licence to use a car parking space at the location of the car parking facility. There are a number of matters which support this construction.

95 As already mentioned, the purpose of the FBT Assessment Act is to identify fringe benefits and assess the taxable value of those benefits. Underpinning the policy of the legislation is an assumption that the thing the employer provides to the employee is a benefit because it has a monetary value and if the thing were not provided in kind the employee would be paid the value of the thing in additional remuneration and, consequently, the employee would pay income tax on that additional remuneration. However, if the thing provided has no monetary value, while it may be a ‘benefit’ in a general sense it is not a benefit of any fiscal consequence because it has no impact on the employee’s remuneration. The provision of parking to an employee may be a benefit with no fiscal consequence if, for example, there is an abundance of free car parking available within reasonable proximity to the employee’s place of business. Therefore, an object of Div 10A is to identify appropriately comparable car parking to that provided by an employer to an employee that is a benefit with a monetary value.

96 The concept of comparability is embedded in the definition of ‘commercial parking station’ and in the preconditions for a car parking benefit in s 39A(1). There is comparability in location: a commercial parking station is located within a 1 km radius of the relevant premises: s 39A(1)(a)(ii); and the car is parked at or in the vicinity of a primary place of employment: s 39A(1)(e) and s 39A(1)(f). There is comparability in the type of car parking spaces made available: the car is parked on the relevant premises for a total duration exceeding four hours during daylight: s 39A(1)(a)(i) and s 39A(1)(b); and a ‘commercial parking station’ requires that car parking spaces be available for ‘all-day parking’ which is parking a single car for a continuous period of six hours or more during a daylight period: s 136(1). There is comparability in the use of car parking: the car is used in connection with travel between a place of residence and a place of employment: s 39A(1)(f) and s 39A(1)(g); and a ‘commercial parking station’ requires that car parking space is available to members of the public for all-day parking which self-evidently includes members of the public utilising all-day parking to commute to their employment.

97 Comparability in location, type and use is then used as a basis for identifying if there is sufficient monetary value in the comparable car parking for the parking provided to an employee to qualify as a ‘benefit’ and, then, to assess the taxable value of that benefit. An element of a car parking benefit is that the lowest fee charged by the operator of any commercial parking station located within a 1 km radius of the relevant premises ‘in the ordinary course of business to members of the public for all-day parking … is more than the car parking threshold’: s 39A(1)(a)(iii).

98 As the Full Court observed in Federal Commissioner of Taxation v Qantas Airways Ltd [2014] FCAFC 168; (2014) 227 FCR 554 at [12]-13, ‘the condition that there be a commercial parking station within a one kilometre radius of the employer’s business premises to constitute a car parking fringe benefit is … a proxy for determining the taxable value of a benefit provided by the employer to an employee…’. The necessity for there to be a commercial parking station within a kilometre of the employer’s premises is a ‘trigger for liability to the tax but it is not the concept which is taxed’.

13    … Rather, it is the statute’s way of working out which car spaces are likely to be sufficiently valuable to bother either the taxpayer (or the Commissioner) in going down the path of assessment. If there is a commercial parking station within a kilometre then assessing the value of a car space provided by an employer to an employee is likely to be worthwhile, but not otherwise.

99 Where liability is triggered, the taxable value is assessed using one of the methods prescribed in Subdiv B. Two of those methods also use the lowest fee charged for comparable parking space to assess the taxable value of a car parking benefit: s 39C (commercial parking station method); s 39DA (average cost method). However, an employer may elect to assess the benefit using the market value basis. That method requires a report from a suitably qualified valuer and the taxable value is ‘the amount that the recipient could reasonably be expected to have been required to pay the provider in respect of the provision of the benefit if it were assumed that the provider and the recipient were dealing with each other at arm's length’: s 39D.

100 The phrase ‘arm’s length’ is not defined in the FBT Assessment Act. However, the phrase ‘arm’s length transaction’ is defined to mean ‘a transaction where the parties to the transaction are dealing with each other at arm’s length in relation to the transaction’: s 136(1). Otherwise, the concept of ‘arm’s length’ is well-established and frequently used in revenue legislation. The ordinary meaning of ‘arm’s length’ describes a relationship between parties who are strangers to each other and who bear no special duty, obligation or relation to each other. An ‘arm’s length transaction’ describes a transaction negotiated between such unrelated parties acting severally and independently in which neither has the ability to exert influence or control over the other and in which each party seeks to obtain the best possible bargain in the circumstances. That is, a fair market value in the exchange of a thing for money: see, e.g., Australian Trade Commission v WA Meat Exports Pty Ltd [1987] FCA 308; (1987) 75 ALR 287 at 291 (Beaumont, Wilcox and Burchett JJ).

101 Section 39D includes the heading ‘Taxable value of car parking fringe benefits – market value basis’ which is used to describe the assessment method in that section. That text forms part of the Act: s 13(1) of the Acts Interpretation Act 1901 (Cth); Quikfund (Australia) Pty Ltd v Airmark Consolidators Pty Ltd [2014] FCAFC 70; (2014) 222 FCR 13 at 81. Even if it were not part of the text, it would form part of the extrinsic materials to which reference may be had under s 15AB of the Interpretation Act: Mondelez Australia Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union [2020] HCA 29; (2020) 271 CLR 495 at 17 (Kiefel CJ, Nettle and Gordon JJ); X v Australian Prudential Regulation Authority [2007] HCA 4; (2007) 226 CLR 630 at [35]-38, 114. Thus, while a heading of a section cannot be used to replace the text of the section, it may be used as a guide to the purpose or object of the section. In that respect, although said in connection with contractual interpretation, the following observations of Lord Hoffmann in Chartbrook Ltd v Persimmon Homes Ltd [2009] 1 AC 1101 at [17] are equally apposite to legislative definitions and section headings:

… words used as labels are seldom arbitrary. They are usually chosen as a distillation of the meaning or purpose of a concept intended to be more precisely stated in the definition. In such cases the language of the defined expression may help to elucidate ambiguities in the definition or other parts of the agreement. …

102 The use of the phrase ‘market value’ as a description of an amount reasonably expected to be paid in a transaction between parties dealing with each other at arm’s length alludes to another well-established common law concept. A ‘market value’ is the price point at which a hypothetical, prudent, willing but not anxious, and fully informed buyer and seller would meet to transact a notional sale on the date of valuation: Williams v Toyota Motor Corporation Australia Ltd [2024] HCA 38; (2024) 419 ALR 373 at 197; Spencer v The Commonwealth (1907) 5 CLR 418 at 431-432 (Griffith CJ); 440-441 (Isaacs J).

103 The focus of an arm’s length transaction in s 39D is not merely on a transaction between unrelated parties. It is a transaction for payment of money in exchange for use of a car parking space. The willing but not anxious hypothetical ‘seller’ is a person (licensor) granting a licence to an unrelated person ‘buyer’ (licensee) to use a car parking space for a period of time. The unrelated parties in that circumstance are bargaining for the ‘price’ (fee) for that licence. The licensor is presumed to seek to maximise while the licensee is presumed to seek to minimise the licence fee. It is a ‘price’ that is not distorted by any other interests or considerations except maximising or minimising the fee. That is precisely the kind of transaction that may be presumed to take place in an appropriately comparable car parking facility.

104 In general, it may be presumed that the fees charged for comparable car parking spaces between operators and members of the public dealing with each other at arm’s length represent the market value for the car parking space provided by an employer to an employee. Accordingly, in general, there should be no material difference in the assessment of the taxable value under the commercial parking station method or using the market value basis. However, there can be circumstances in which due to market failure or for some other reason the lowest fee charged by any operator of a commercial parking station within a 1 km radius of the relevant premises is not a true reflection of the market value of that car parking benefit. In such circumstance, an employer may elect to use the market value basis to assess the taxable value of the benefit. Therefore, the ability of an employer to elect to use the market value basis is a firm indication that the legislature intended that the taxable value of a car parking benefit should be not more than the market value of that benefit and the legislature intended the lowest fee charged by the operator of any commercial parking station within a 1 km radius of the relevant premises would generally be representative of the market value of that benefit.

105 There are other examples of fringe benefits that do not involve a direct monetary cost or expense incurred by the employer or a direct monetary benefit that are also valued by reference to the market value of the benefit or the notional value of the benefit in an arm’s length transaction between the recipient and provider. For example, in certain circumstances, the taxable value of housing benefits are assessed by reference to the ‘market value’ of the housing right granted to the employee: s 26, s 27. In certain circumstances, property fringe benefits are valued by reference to the notional value of the property or an arm’s length sale price of property manufactured, produced, processed or treated by the employer: s 42. In certain circumstances, residual benefits are valued by reference to the notional value of the benefit: s 48, s 49. The concept of ‘notional value’ is defined in a similar way to the market value basis as ‘the amount that the person could reasonably be expected to have been required to pay to obtain the property or other benefit from the provider under an arm’s length transaction’: s 136(1). Therefore, in general, the taxable value of a fringe benefit is assessed by reference to the actual cost, expense or monetary amount of the benefit provided or a valuation based on the ‘market value’ of the benefit provided or a notional value of the benefit in which it is presumed that the recipient and provider are acting at arm’s length and, therefore, seeking to obtain the best possible bargain in the circumstances.

106 It follows that, in context, the object of the definition ‘commercial parking station’ is to identify a potentially comparable substitute for a car parking space an employer provides to an employee. A car parking facility at which there are no transactions between unrelated willing but not anxious licensors and licensees is not a facility at which there will be potentially comparable transactions. Therefore, the potential for comparability informs the sense in which ‘commercial’ is used within the composite phrase.

107 There are also other textual indications that the definition of ‘commercial parking station’ is directed towards the identification of a car parking facility at which transactions take place on an undistorted market value basis. Within the definition a characteristic is that it be a facility ‘where any or all of the car parking spaces are available in the ordinary course of business to members of the public for all-day parking on that day on payment of a fee’. That characteristic is of significance to the meaning of ‘permanent commercial parking facility’ in two ways.

108 First, there is a reference to the availability of car parking spaces in ‘the ordinary course of business’ on payment of a fee. When read with ss 39A(1)(a)(iii), 39C and 39DA all of which refer to the lowest fee charged by an operator of a commercial parking station ‘in the ordinary course of business’ it is plain that ‘business’ in that expression refers to a ‘business’ involving the operation of a permanent car parking facility. The expression, in context, does not refer to a general conception of business such as that which applies to legislation relating to bankruptcy and insolvency: see, e.g., Fairway Estates Pty Ltd v Commissioner of Taxation (Cth) [1970] HCA 29; (1970) 123 CLR 153 at 162 (Barwick CJ); compare, e.g., Harkness v Partnership Pacific Ltd (1997) 41 NSWLR 204 at 216-217 (Abadee AJA). In reference to the operator of the car parking facility the expression alludes to the notion of a common course of conduct of a business. The word ‘business’ has a number of common meanings. In general, it is referrable to continuous or repetitive activities engaged in for the purpose of profit: e.g., Hope v Bathurst City Council [1980] HCA 16; (1980) 144 CLR 1 at 8-9 (Mason J). The requirement that the relevant transactions be in the ordinary course excludes transactions made for purposes other than carrying on of the business or to achieve ends disparate from those of the business activity: Fairway Estates at 163. Second, there is reference to car parking spaces ‘available … to members of the public … for all-day parking … on payment of a fee’. These words describe a transaction that may be presumed to be at arm’s length for the grant of a licence to use a parking space for a period of time in exchange for payment of a licence fee.

109 Taken together these elements of a permanent commercial car parking facility describe a facility at which arm’s length transactions take place between an operator in the ‘business’ of operating that facility and members of the public. These are elements of transactions between a willing but not anxious licensor seeking to maximise and a willing but not anxious licensee seeking to minimise the licence fee. That is, transactions at that facility may be presumed to represent the market value for the car parking spaces at that location.

110 That an object of Div 10A is to identify and value comparable ‘market value’ car parking space is confirmed by the Explanatory Memoranda for the Bills for the amending Acts by which FBT was introduced for car parking benefits and by which the definition of ‘commercial parking station’ was amended. The Explanatory Memorandum to the 1992 Bill provided the following examples of car parking facilities that would not fall within the meaning of a commercial parking station.

… A car park which was not run with a view to making a profit (usually reflected in significantly lower car parking rates charged compared with the normal market value for that facility) would not be commercial.

Some car parking facilities have a primary purpose to provide short-term shopper parking. To discourage all-day parking, the operators of these facilities charge penalty rates for all-day parking. These rates are significantly greater than the rates that would be charged by a similar facility which encouraged all-day parking. For the purposes of these provisions, short-term shopper parking facilities using penalty rates for all-day parking will not be treated as a “commercial parking station”.

111 It is permissible to have regard to extrinsic material to confirm the meaning of the provision is the ordinary meaning conveyed by the text of the provision taking into account its context in the Act and purpose or object underlying the Act or to determine the meaning of the provision is ambiguous or obscure: s 15AB of the Interpretation Act. However, extrinsic materials cannot displace the meaning of the legislative text and nor is their examination an end in itself: Consolidated Media Holdings at [39]. Moreover, extrinsic materials cannot be used to add or subtract from or be substituted for the text of the legislation: Re Bolton; Ex parte Beane [1987] HCA 12; (1987) 162 CLR 514 at 518 (Mason CJ, Wilson and Dawson JJ). Therefore, these examples cannot be used as expressions of the meaning of the legislation, but may be understood as illustrations reflecting the evident purpose or object of the provisions to identify the existence and taxable value of the car parking benefit by reference to the existence of an appropriate comparator to the ‘benefit’ provided by an employer to an employee.

112 The first example is not an appropriate comparator because ‘significantly lower car parking rates [are] charged compared to normal market value for that facility’. The second example is not an appropriate comparator because ‘the operators of [the] facilities charge penalty rates for all-day parking’ and the ‘rates are significantly greater than the rates that would be charged by a similar facility which encouraged all-day parking’. In these examples the car parking facility is not relevantly ‘commercial’ because the fees charged for use of the car parking spaces do not reflect the market value of a car parking space. That is an indication that a purpose of the definition of commercial parking station is to identify a permanent commercial car parking facility at which comparable market value transactions take place.

113 A consequence of the manner in which s 39A and s 39C operate is that a car parking benefit may exist, but the taxable value of that benefit may be less than the car parking threshold. That circumstance can arise if there is more than one commercial parking station and the lowest fee charged by at least one operator is more than the car parking threshold, but the lowest fee charged by another operator is less than the car parking threshold. Before the amendments to the definition of ‘commercial parking station’ made in 1994 the lowest fee charged by any operator could be calculated by reference to fees charged outside daylight periods and by operators of metered street parking. The Explanatory Memorandum to the 1993 Bill explained the purpose of the amendments as follows:

2.2    The amendments will change the wording of the definitions of “ all-day parking ” and “ commercial parking station ” in subsection 136(1) of the [FBT Assessment Act]. These definitions are used in section 39C of the [FBT Assessment Act] which sets out a method for determining the taxable value of a car parking benefit.

2.3    These definitions allow employers to determine the taxable value of a car parking benefit provided to an employee by reference to night time fees set by commercial parking station operators and also by reference to fees charged at kerbside parking meters. The use of these fees result in a lower taxable value for a car parking benefit. A further consequence is that car parking in some non-CBD areas may be subject to FBT where there are kerbside parking meters.

2.4    The definitions will be amended so that the taxable value of a car parking benefit determined under section 39C of the [FBT Assessment Act] can only be determined by reference to daylight period rates and kerbside parking meters are excluded from being commercial parking stations.

114 It follows that, before the amendments made in 1994, the taxable value of a car parking benefit could be assessed by reference to fees charged for a car parking space that were not truly comparable to a car parking benefit. Such fees were not comparable by reference to the period of use (outside daylight hours) or type of use (street parking). The amendments removed the possibility of assessing taxable value by reference to these non-comparable fees. Again, the explanation of the amendments is an indication that a purpose of the definition of ‘commercial parking station’ is to identify comparable market value transactions.

115 A permanent car parking facility that is engaged in or deployed in commerce may, but need not, be a facility at which all or any car parking spaces are made available at market value for use of that space. Relevantly, if an operator of a permanent car parking facility is engaged in continuous and repetitive activities from which it may be presumed or inferred that the operator (as licensor) is seeking to make the best possible bargain with unrelated third parties (as licensees) for the use of all or any car parking space made available at the facility, that facility is a ‘permanent commercial car parking facility’. However, a permanent car parking facility would not be relevantly commercial if there were facts from which it may be presumed or inferred that the operator is not seeking to make the best possible bargain with unrelated third parties for all car parking spaces made available at the facility.

On the ruled facts was the Grand Central car parking facility relevantly ‘commercial’?

116 It follows that, with due respect to the primary judge, I have arrived at a different conclusion regarding the meaning of ‘permanent commercial car parking facility’. Therefore, it is necessary to consider if the primary judge’s construction resulted in his Honour erroneously concluding that the Grand Central car parking facility was not a commercial parking station on the ruled facts set out in the Commissioner’s private ruling. Here, the relevant question is whether on the ruled facts it can be concluded that none of the transactions in the ordinary course of business of that car parking facility were for a ‘market value’ of car parking licences at that location.

117 The primary judge inferred from the ruled facts that parking at Grand Central was free for up to three hours with escalating fees rising to a maximum of $20 for over seven hours contrasted with the fees charged for all-day parking in other car parking facilities operated in the Toowoomba Central Business District of between $6 and $9 per day that it was ‘obvious’ that the Grand Central car parking facility was operated to a different end to a commercial car parking facility: PJ [41]-[43]. His Honour said:

43    … It is obvious from the range of fees that it is being operated to the end of complementing the operation of the shopping centre. It is being operated to the end of being an attractive force that brings in business to the shopping centre, and more particularly its tenants. It is certainly, for those reasons, being operated in trade or commerce, but considered as a car parking facility alone, the range of free parking is inconsistent with it being operated commercially for profit, as opposed to commercially in the context of a shopping centre, not a standalone car parking facility.

118 The primary judge then concluded that the Grand Central car parking facility is not a commercial parking station as defined in s 136(1) of the FBT Assessment Act: PJ [44].

119 There are some features of the Grand Central car parking facility that distinguish the manner in which fees were charged from other parking facilities in the Toowoomba CBD. The other parking facilities charged a flat hourly rate up to maxima between $6 and $9 per day. It may be inferred from that fact that these were maxima for parking of a single car for a continuous period of six hours or more during a daylight period; that is, maxima for ‘all-day parking’ as defined in s 136(1) of the FBT Assessment Act. The operator of Grand Central charged fees of $10 for between six and six and a half hours, $15 for between six and a half and seven hours and $20 for more than seven hours. There were certain exceptions where parking was free or all-day parking was reduced to $7.50 per day for the centre’s staff and customers of the centre who lived outside Toowoomba. However, the different manner in which fees were charged for parking up to six hours and for parking over six hours is not sufficient to infer that the operator of the Grand Central car parking facility was not engaged in activities by which that operator was seeking to make the best possible bargain for use of at least some car parking space made available to members of the public at that location. Further, there are a number of other ruled facts from which it may be presumed, to the contrary, that the operator was seeking to make the best possible bargain for at least some car parking space for some periods of the day at that facility.

120 In March 2017 a $500 million redevelopment was completed by which the car parking spaces were doubled from 2,000 to 4,000. Paid car parking was introduced in June 2017. Therefore, it may be inferred that before the redevelopment, parking at the Grand Central car parking facility was free. The Grand Central car parking facility has ticketless parking that uses licence plate recognition to track parking without the need for a paper ticket. Boom gates at the car park exits automatically open for cars parked for less than three hours. If customers have paid at a pay station for cars parked for more than three hours the boom gate will automatically open and, if not and payment is required, credit card payment can be made at the boom gate. The cost of redevelopment, introduction of paid parking, features of the car park and fees charged for various periods of parking during the day are all indicative of a car parking facility operated, at least in part, to generate revenue from parking fees.

121 There is no other information in the ruled facts about the Grand Central car parking facility or the other facilities in the Toowoomba CBD. For instance, it is not known if Grand Central is under-cover parking and the others are not. Nor is it known if Grand Central has security guards and the others do not. That is, there may well be features of the Grand Central car parking facility that would make it more attractive for all-day parking and justify payment of a greater daily fee than the other facilities. Additionally, the identity of the operator of the Grand Central car parking facility is not known. The identity of the operator is relevant to drawing any inference to the effect that the Grand Central car parking facility was not operated to obtain the best possible bargain for use of all car parking spaces.

122 For the foregoing reasons and with due respect to the primary judge, from the ruled facts it is not ‘obvious’ that the Grand Central car parking facility was not operated ‘commercially for a profit’ on a stand-alone basis. Further, it remains possible to draw or, on the ruled facts, it is not possible to exclude other competing inferences. It is also not obvious or possible to draw an inference that the Grand Central car parking facility was not operated whereby at least some car parking spaces were made available to members of the public in the ordinary course of business on payment of a market value fee for use of that space at that location for a period of time.

Disposition

123 I would uphold the appeal. I agree with the proposed orders of McElwaine and Wheatley JJ.

| I certify that the preceding fifty-eight (58) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Feutrill. |
Associate:

Dated:    27 April 2026