SA Election 2018: Liberal party pledges to cut land tax to support business owners and investors
THE Liberal Party has pledged to support business owners and investors by trimming land tax, if elected.
SA 2018
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THE Liberal Party has pledged to support business owners and investors by trimming land tax, if elected.
Under the plan, from July 2020 land tax would not be paid until site values reached $450,000 — an almost $100,000 reprieve on the existing $353,000 threshold.
The top rate on land valued between about $1.2 million and $5 million would be slashed from 3.7 per cent to 2.9 per cent.
Liberal Leader Steven Marshall said the overhaul would make the state a more attractive place for people to invest and carry out business.
“South Australia’s land tax regimen under the Weatherill Labor Government is the most uncompetitive in Australia,” Mr Marshall said.
“Since 2002, Labor has increased land tax revenues by almost 150 per cent. We now have the highest top marginal rate in Australia at 3.70 per cent — the national average is 2.17 per cent.
“We need to even out the playing field and incentivise people to invest in SA.”
Liberal modelling has put the cost of these measures on the State Budget at about $32.3 million a year from 2020-21.
The rate of 3.7 per cent is currently levied on all property valued above $1.176 million.
Based on property data, including current valuations obtained under Freedom of Information laws, the change in the top rate would benefit about 3200 property owners.
Nationally, WA has the next highest top marginal rate of 2.67 per cent.
Mr Marshall said a Liberal government would aim to have a nationally competitive land tax regimen, but this would depend on the state of the Budget.
He said the existing tax system was “stifling business investment, discouraging businesses from investing their capital and creating jobs here”.
“Instead people are investing in property in Western Sydney and other areas on the east coast,” he said.
The Grattan Institute has recommended states remove the tax-free threshold and switch to a flat rate. Labor will likely attack the policy as unaffordable given the state bank tax was knocked back.
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