The State Labor Opposition has announced today they will move to block the Marshall Liberal Government’s Land Tax Reform package.
The Labor Party has been in regular communication with the MTA, including in the last 24 hours on this issue with Opposition Leader, Peter Malinauskas. It’s great to see that common sense has come before politics and they have moved to block this harmful retrospective legislation.
Following conversations with members this morning, some have indicated that the Land Tax Reform package, including the latest change, will still lead to a stifling of investment in their business, with one member indicating it will impede their ability to employ a further five to seven employees.
The State Liberal Government’s latest change to the proposed Land Tax Reform package, which was introduced in State Parliament, will deliver some relief to investors and property owners with portfolios valued over $1.1m but the MTA still holds concerns over aggregation.
Their latest plan is seeking to introduce a new 2 per cent tax rate, applying to land portfolios valued between $1.1m and $1.35m from July 1 2020. This bracket would be expanded to include investments of up to $1.6m in 2022.
While the proposed changes will result in a reduction in land tax from the most recent proposal, for people paying land tax for valuations above $1.1m, the aggregation effect will still mean that many members will be significantly worse off than they currently are.
Unfortunately the State Government’s proposed changes do not go far enough and the MTA’s position remains unchanged. While the State Treasurer, Rob Lucas, has said he is not willing to grandfather the existing legislation, the MTA is of the position that NOW is the time for a review of the tax system and that we need clarity of what the impact of any changes will be.
It is vital that South Australia remains competitive rather than put in a position where investment is stifled.