Treasurer Rob Lucas says best estimate of land tax revenue would be $40 million a year
Rob Lucas says Treasury has no idea how many people avoid paying land tax – but he estimates the reforms would bring in $40 million a year.
State Treasurer Rob Lucas said the Government is unsure of the budget revenue from its proposed land tax reforms, but $40 million a year is a “best estimate”.
The Government proposes to crack down on company structures and trusts which minimise land tax.
Mr Lucas has told a Budget Estimates hearing that Treasury has no idea how many people avoid paying land tax.
“If someone is not paying any land tax because of company structures or trusts Revenue SA does not have them in line of sight.”
He said under the proposed changes these people would pay land tax but as the number was unknown, the $40 million a year figure was Treasury’s “best estimate”.
“Clearly because it is an estimate they (Treasury) would be looking at a range of estimates.”
Quizzed by Opposition treasury spokesman Stephen Mullighan on whether Treasury had looked at a range of possibilities, Mr Lucas conceded this was the case but said he was not given multiple choices, only the $40 million figure.
“As Treasurer I was not presented with a smorgasbord of options,” he said.
If the take is higher the Government intends to accelerate land tax reforms such as lowering rates, but if it is marginally lower Mr Lucas said it would be unlikely to impact on policy.
He noted Treasury’s estimate of such a change done for the Labor government in 2015 was $30 million a year, making the current estimate reasonable.
He bluntly rejected the Property Council’s estimates of the increased tax take which varies from $80 million to $300 million a year.
“The reality is some of the claims that we are going to collect $300 million, $200 million or $80 million are wildly speculative and highly improbable,” Mr Lucas said.
Mr Lucas ruled out privatising SA Water but said SA Pathology and SA Medical Imaging face being outsourced unless their performances improved.
He said after Labor’s time in power selling assets such as the Motor Accident Commission “there is not much left to privatise” but added: “if it is in the interest of taxpayers we will considering outsourcing options for the provision of government services.”
Mr Lucas also justified his press secretary’s 6 per cent pay increase, saying she had taken on extra responsibilities including being his delegate to a Government committee and mentoring other staff.