Federal silence on Queensland land tax

Federal Treasurer Jim Chalmers has refused to weigh in on Annastacia Palaszczuk’s controversial land tax shake up.

Treasurer Jim Chalmers has refused to weigh in on the Premier’s controversial land tax shake up that will likely see rents spike, saying governments at all levels were “doing their best to repair the budget”.

It comes as the Property Council of Queensland warned the tax change from next year would have a “massive impact” on commercial landholders and businesses which had office fronts in multiple states.

Dr Chalmers, the Federal Treasurer, refused to weigh into the controversy – saying his state counterpart Cameron Dick and Queensland Premier Annastacia Palaszczuk were “capable” of “explaining the decisions that they take in state budgets”.

Federal Treasurer Jim Chalmers. Picture: NCA NewsWire / Gary Ramage

“I’ve got a very collegial relationship with the treasurers and particularly with the treasurer of Queensland and I understand that governments at all levels are doing their best to repair the budget,” he said.

From the end of June 2023 the value of a company’s non-exempt landholdings in other jurisdictions will be used to calculate the rate of land tax to be paid in Queensland.

The Queensland tax-free threshold for companies is $350,000, lower than the $600,000 for individuals.

Property Council of Australia Queensland executive director Jen Williams said it would be a “huge disincentive for businesses” to have their own premises and to be based in Queensland.

“(A business) might own their own premise in Queensland, New South Wales and Victoria, so they might own $1.5m worth in land in Queensland and then the same in the other states and suddenly their land tax bill has (increased) in Queensland,” she said.

Ms Williams warned another “big sleeper” issue was Queensland’s different land tax exemptions compared to other states, particularly on land used for activities like childcare.

Childcare centres in NSW are exempt from land tax while in Queensland land used for educational activities by charitable organisations is exempt, though there is no specific mention of childcare.

According to the Queensland Revenue Office land tax calculator, a company with a land portfolio of $1.5m in Queensland and $3m elsewhere would expect to pay $21,000 a year of tax under the current regime but this will increase to $22,500 from mid 2023.

Originally published as Federal silence on Queensland land tax