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House of Assembly - Fifty-Fifth Parliament, First Session (55-1)
2022-05-04 Daily Xml
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Land Tax

Ms SAVVAS (Newland) (14:48): My question is to the Treasurer. Can the Treasurer update the house on the current status of the 2019 land tax reform and the delays in issuing bills?

The Hon. S.C. MULLIGHAN (Lee—Treasurer) (14:49): I am very grateful to the member for Newland for her question and her interest in this. I know that, like many of us in this place, her constituents have been badly affected by these reforms of the former Liberal government.

As we were canvassing yesterday, at the 2018 election the Liberal Party promised lower costs to South Australians, yet there they were 18 months later imposing what they initially claimed was a $40 million tax increase on property owners here in South Australia. These changes were part of a budget which included a total $500 million increase in state government taxes, fees and charges over a four-year period. It took an immediate public outcry from property owners and complaints about how many people would be impacted by these changes until the then government finally woke up to the fact that they needed to do some work about these changes.

Think of that: a tax reform goes to a cabinet without ministers knowing how much revenue would actually be raised and how many people would be impacted. Once the former Liberal government had that extra work done it soon became clear that the impost on South Australians would be over $100 million a year from these changes. There began a series of changes to the bill.

Finally, in version 7 tabled in this place in November 2019, the government was forced to cut their top marginal tax rate for land tax for property owners with more than $1 million worth of land. The net effect of these reforms was that property owners who owned more than $1 million of land would be trousering a tax cut of more than $50,000 a year, which was to be paid for by family businesses, other small businesses, self-funded retirees and families who had the temerity, according to the former Liberal government, to have an investment property. It is absolutely extraordinary.

Remarkably, hundreds of these land tax payers that benefited from the cut to the top marginal tax rate reside both overseas and interstate, meaning that South Australians are paying for a tax cut for people who live outside our own state. That is the record of the former Liberal government, but of course the difficulties didn't end there. It soon became clear—

Members interjecting:

The SPEAKER: Order, member for Hartley! The acting leader of the opposition is called to order.

Members interjecting:

The SPEAKER: Order! The Treasurer has the call.

The Hon. S.C. MULLIGHAN: Thank you, Mr Speaker, for your protection. It soon became clear that not only did the government not initially know how much they would raise and from how many people it would be raised from, they didn't actually know how to raise it. They couldn't actually issue the bills to the community, so this egregious tax increase could be harvested from hardworking South Australians.

The government was forced at that time to come into this place, in May 2021, and change legislation to give themselves more time in order to give effect to these land tax changes. I can report to the house that from the last two financial years impacted by these land tax increases there are still more than 5000 bills to be issued from the 2020-21 financial year and 2021-22 financial year. At one point, more than a quarter of the 55,000 land tax bills were late. That is why we make commitments to the people of South Australia not to make tax changes unless they are signalled well before an election.

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