State Government’s controversial new land tax reforms must be urgently debated in Parliament: SA-BEST
A bid for State Parliament to debate the Marshall Government’s controversial proposed land tax reforms as a matter of urgency has been made by SA-BEST.
SA-BEST MLC and Treasury and Budget spokesperson, Frank Pangallo, said such is the anger and uncertainty across the community has introduced a Motion in Parliament calling for the issue to be debated as a priority.
He is also considering calling for a Select Committee to be established to investigate the proposed new changes – something the Labor Opposition has said it will support - but will wait until he sees the proposed legislation before making a final decision.
“Make no mistake, the state’s economy is being impacted NOW by proposed new land tax reforms that might or might not come into force from July 1 next year,” said Frank, ahead of a forum SA-BEST is holding on Sunday to discuss the proposed land tax reforms.
“That started the day Treasurer Rob Lucas flagged the changes - and has been in steady decline since,” he said.
“The government’s proposed overhaul to land tax laws has caused widespread outrage across the community – not just from the “top end of town” that some people are saying, but also thousands of hard-working mum and dad investors who have strived all their lives to provide a strong financial future for themselves and their families,” he said.
“Investors - from large property developers to hard-working mums and dads - are making decisions NOW in fear of what lies ahead.
“One developer has told me he is putting three of his fledgling projects on the backburner, while – for the first time in his 40+ year career – he begins looking at investment opportunities interstate.
“Another local businessman believes the government’s proposed changes are the greatest threat to the state’s economy that he has seen in his near 50-year career.
“The building industry and the business sector have also raised serious concerns to me that the changes will spark a significant downturn in activity
“As a state looking to remain nationally competitive, we simply can’t afford to let the uncertainty of what the government may or may not be considering continue.
“The matter needs to be debated as a matter of urgency and that is why I introduced the Motion.”
Treasurer Lucas announced the proposed changes in last month’s State Budget saying they would reap the government about $40 million a year.
From 1 July 2020, investment properties held in multiple trusts by the same person/family will be aggregated together, closing a current loophole where some owners hold their properties in individual trusts.
This will mean the land tax will be payable based upon the entire value of the portfolio, rather than on the individual value of each site.
The government’s proposed changes will target investors who legally split their properties into separate trusts, thereby decreasing the overall tax to be paid by the investment property owner.
As a result of the government’s planned reforms, land tax bills for hundreds of mum and dad investors are expected to rise by more than 2000%.
SA-BEST is holding a forum at noon this Sunday (4 August) for people to air their concerns about the government’s land tax reforms.
Frank said the forum – to be held at the Allan Scott Auditorium at UniSA’s City West campus on North Terrace – was desperately needed to allow the major players to discuss the full impacts of the proposed changes.
“The State Government has got it wrong on this one – and it knows it,” Frank said.
“When many of his own MPs are threatening to vote against the changes he is proposing – not to mention many of his own party supporters and generous donors - Premier Marshall knows he’s bitten off more than he can chew,” he said.
“Not only will hard-working mum and investor investors be unfairly hurt, but so too will small businesses.
“What message does it send to potential overseas and interstate investors – investment in SA and be hit by the harshest land tax rates in the country.
“At the end of the day, any increased costs faced by property owners – whether they own commercial or residential properties – will be passed on to the businesses and tenants that rent those sites.
“While SA-BEST supports lowering land tax rates, it must not come at the expense of the state’s economic growth.”
WHAT: Land tax forum (including a panel discussion)
WHEN: Sunday, 4 August 2019 (midday)
WHERE: Allan Scott Auditorium, UniSA City West Campus, North Tce, city