This information has been provided by
Doug Disher Real Estate, June 2005 and is applicable in Queensland
only.
LARGER than expected
reductions in land tax rates were handed to property
investors in yesterday's Queensland budget as part of a
$5billion package of cuts to state charges over the next
seven years.
But spiralling land valuations and continued migration meant
the Queensland Government delivered the cuts without
sacrificing revenue.
Treasury documents show the Government expects a 1.4per cent
rise in land tax revenue to $431million in the next
financial year.
Queensland Treasurer Terry Mackenroth said the land tax
cuts, saving investors $847million over the next four years,
would mean 21,000 people who paid land tax last year would
not have to pay it under the new rates.
From July 1, the threshold at which land tax begins to be
levied will be increased from $275,997 to $450,000, and the
rate lowered from 1.8 per cent to 1.25 per cent for
investors with land holdings valued about $3million.
For companies and foreign residents, the land tax threshold
would be lifted from $170,000 to $300,000. Land tax is
charged on the unimproved land valuation of investment
properties, but principal places of residence are exempt.
Caravan parks would also be exempt from paying land tax if
more than half their caravans or manufactured home sites
were occupied by long-term residents. The Government is also
planning to provide land tax relief for home businesses, but
is yet to finalise the details of the package.
The Beattie Government had been facing a revolt from
property investors as spiralling unimproved land valuations,
sparked by the property boom, threatened to force tens of
thousands of investors into the tax net.
Property Council of Australia executive director Robert
Walker said the land tax cuts were "bigger and better than
anyone in the industry could have imagined".
Mr Walker said the rate cut would provide a significant
advantage for property investors in Queensland over other
states that had maintained higher rates.
Mr Walker predicted the land tax cuts would attract more
interstate property investors to Queensland, underpinning a
market which had shown signs of softening.
Pledging to review the land tax threshold and rate again
next year, Mr Mackenroth said the Government had listened to
the concerns raised by property owners and caravan park
owners faced with spiralling land tax bills.
"All land taxpayers will pay less, and more than 50,000
people who would have had to pay land tax won't have to pay
it," Mr Mackenroth said.
With the budget awash with cash, courtesy of a $2.7billion
operating surplus in 2004-05 and a projected $934million
surplus next financial year, Mr Mackenroth also announced
that a raft of state taxes would be phased out gradually
between January next year and January 2011.
Starting January next year, stamp duties on leases, credit
business, non-quotable marketable securities, mortgages
hiring arrangements and business conveyances other than real
property will be phased out.
