State government owed nearly $50m in land tax bills, new figures show

The state government is owed nearly $50m in land tax, new figures show — and the cost of hiring gurus to fix the flawed billing system will make your jaw drop.

The state government is owed nearly $50m in land tax bills that are either yet to be issued or as yet unpaid, new figures show.

The huge figure comes despite revelations the Marshall government paid nearly $1m for two staff from Japanese tech giant Fujitsu to work on significant IT issues plaguing the billing system.

Controversial reforms that passed parliament in late 2019 mean people who own multiple properties must pay an aggregate rate of land tax on all their holdings, boosting many to the top rate of tax.

The move was partially offset by slashing the top rate. Previously, landlords could own numerous properties in separate legal entities and potentially pay tax at a lower rate.

Treasurer Stephen Mullighan says the state governmnet had committed to no new taxes, and it would stick to that commitment. Picture: Emma Brasier.

Treasurer Stephen Mullighan slammed the previous government’s reforms, which he said resulted in large tax increases to regular South Australian property owners while delivering generous tax cuts to multimillion-dollar corporate land holdings.

“The Liberal government required RevenueSA to apply complex changes without considering whether it had the systems and processes to properly implement the change, leaving taxpayers with a further bill for more than $1m in implementation costs,” he said.

So far, $536m in revenue from land tax has been collected for the 2021-22 financial year, and $513m for 2020-21. About 65,000 bills have been issued for 2021-22, while another 500 ownerships are yet to receive an assessment.

The collective value of those 500 ownerships is about $15.3m, according to a set of figures supplied to The Advertiser by the government.

Another $33.8m is outstanding because of the 3500 bills yet to be paid and now in the hands of debt collectors.

A government spokeswoman said the delays in billing generally related to processing complexities, with necessary information to be gathered from the taxpayer and other sources such as the Australian Securities and Investments Commission or trustees.

“In most cases, we are in communication with the taxpayer in relation to delays,” she said.

Despite his criticisms, Mr Mullighan indicated Labor was unlikely to change the current land tax system, saying Labor “has committed to no new tax increases”.

A Liberal spokesman denied the changes had pushed up land tax bills for regular landowners.

“It was the Department of Treasury and Finance who advised former Liberal Government that tax reform reduced land tax by up to $75 million per year, meaning more cash in the pockets of mum and dad investors with multiple land holdings who made large savings with a significant reduction in the top tax rate,’’ the spokesman said.