Liberal MP gathers support to fight land tax changes

Former Liberal state president and now MP Steve Murray says he is far from alone in pushing Rob Lucas to ease land tax changes, which colleagues have labelled ‘disastrous’ for the party.

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Pressure from disgruntled Liberal MPs will result in softening land tax changes, according to a prominent backbencher who has slammed the controversial Government policy.

Davenport MP Steve Murray will be among MPs raising the issue at a party room retreat in the Barossa this coming week.

“The discomfort is pretty broad,” said Mr Murray, a former state president of the Liberal Party, said.

“I’m optimistic that we’ll see a solution very soon.”

Another State Government MP also expressed anger.

“The policy development on this has been an absolute train wreck,” the MP said.

”The Cabinet has done the party enormous damage, they’ve taken their eye off the ball.”

Mr Murray said he could not standby while “law-abiding citizens” were penalised.

Changes were “neither fair, nor sustainable, nor competitive”.

“They will increase the attraction, incentive and impetus for investors to leave SA and take their families, money, businesses and jobs with them,” he wrote.

Mr Murray will urge Treasurer Rob Lucas to hold off on changes, particularly while South Australia was in the middle of a statewide property revaluation by the Valuer-General.

“Land tax is the tip of the iceberg,” he said.

Liberal MP Steve Murray. Picture: Tom Huntley

“Revaluations are seven-eighths of the iceberg.”

Mr Lucas and Premier Steven Marshall have pledged more consultation on the changes which were announced in the Budget in June.

Now, many investors own multiple properties via separate trusts and companies — thereby benefiting from multiple tax-free thresholds and lower marginal rates.

Mr Marshall has flagged bringing forward cuts to the top land tax rate which will reduce the bill for an investor with $10 million of land by $65,000.

“We welcome all feedback. we have been consulting and listening to feedback for 10 weeks and will release draft bill in near future for final consultation,” Mr Lucas said.

“Our top rate of land tax at 3.7 per cent is uncompetitive and for many years has led to some people investing interstate.”

Cuts to the top rate — scheduled to be in staged in over eight years — will follow previous tax cuts for landowners.

“The property sector has enjoyed significant relief in recent years, which we support,” Mr Lucas said.

Measures have included:

STAMP duty on commercial property transactions being eliminated.

THE threshold where land tax begins raised to $450,000 and a new marginal rate between $1.3 million and $5 million introduced — at cost of nearly $50 million a year in the 2018-19 Budget.

THE threshold rose from $110,000 to $300,000 and has then been indexed annually since the 2010-11 Budget — costing $57 million in first year, rising to more than $100 million.