On the 18th of June 2019 the state liberal government announced they would be taking measures to close existing loopholes in the Land Tax Act.
The best way to describe this is currently developers can place parcels of land in different company names, escaping larger taxes. The government intends to group land parcels held by common beneficial owners to identify an individual owner. With the little information out there, there are a lot of concerns, speculations and outrage, especially from real estate agents, as it is tough enough out there as it is!
In September 2019 the state Government released a draft Land Tax amendment Bill 2019 to be presented to Parliament. The main points are:
- Slashes the top marginal land tax rate from 3.7% to 2.4%
- Varying threshold limits of properties that will pay land tax.
Land tax is paid by the owners of investment properties (not the principal place of residence) and is applied on the unimproved value of land (not the capital value). My understanding in this issue is, that, if in the Lower House if 50% of MP’s agree to the changes, it will be passed and sent to the Upper House for review. Most MP’s are listening to their constitution who are disagreeing quite strongly to this change.
Reminder: Your own residential home is exempt from Land Tax. The revenue collected from the Land Tax Amendments will assist in the provision of public services such as education, health and public safety.