Land tax reduced as Rann eyes polls
8 February 2005
South Australia's Rann Government has offered the first cut
to spiralling land taxes in more than 10 years, in a move that
will save 120,000 landowners $245million over four years.
Amid rising backbench disquiet and a slump in the Government's
support in the polls, Treasurer Kevin Foley yesterday abolished
land tax on properties worth less than $100,000, raising the
threshold from $50,000.
Home owners with property valued at $400,000 will have their
land tax reduced to $1100 from $2525, while properties worth
$700,000 attract the biggest cut - to $4625 from $7475.
Mr Foley described the revised land-tax regime, backdated to
January 1, as "flatter", saying it would leave every land-tax
payer better off.
He said the reforms reflected the fact that South Australia's
property boom had delivered a large spike in land-tax bills.
"It was clear that the right thing to do, the decent thing to
do, would be to hand back a significant amount of these taxes.
"The Government has been working hard in recent months to
construct a more equitable land-tax system and we believe
today's announcement achieves that goal."
But Land Tax Reform Coalition leader John Darley said he was
disappointed the threshold was not higher.
"We asked for a threshold of $150,000, which is equal in real
terms to the threshold in 1994 before the then Liberal
government raised it," he said.
Mr Darley, a former South Australian valuer-general, said that
from July 1 the Government would raise the valuations on many
coastal, suburban and inner-city properties by up to 25 per
cent, reducing the extent of the land-tax cut.
Premier Mike Rann said the changes stemmed from a roadside
meeting with landowners in the inner-city marginal Adelaide seat
of Norwood, held for Labor by Vini Cicarello, in late November.
"Vini's constituents told me the spike in land tax was hurting
and asked for help," Mr Rann said.
The following month a Newspoll showed that primary support for
the Government had slumped to the same level as that for the
Liberal Opposition, while the Opposition took the lead in
two-party-preferred terms.
Opposition Treasury spokesman Rob Lucas said the "embarrassing"
land-tax cut was designed to protect the marginal seats of the
minority Labor Government, which governs with the support of
independents.
"They know some of their marginal seat members are in trouble,"
Mr Lucas said.
The Real Estate Institute of South Australia welcomed the
reform, saying it was particularly helpful for small investors
and families with a holiday home.
Related articles:
