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Legislative Council - Fifty-Fourth Parliament, Second Session (54-2)
2020-05-12 Daily Xml
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Land Tax

The Hon. F. PANGALLO (15:23): I seek leave to make a brief explanation before asking the Treasurer a question about land tax.

Leave granted.

The Hon. F. PANGALLO: The government's land tax reforms are due to kick in from 1 July this year. However, RevenueSA last week wrote to property owners and trust owners in South Australia stating the changes, and I quote, 'come into effect on 30 June 2020', not, as you would expect, from midnight 30 June. It also requests the owners update their relevant property information via the RevenueSA portal by 3 June 2020 even though it's letter states the information is for the 2020-21 financial year.

Accountants and landowners who have contacted me are concerned this may be a sleight-of-hand trick by the government to ensure impacts of the new land taxes kick in a year earlier than stated, in the 2019-20 financial year and not the 2020-21 financial year as many believe. They are also concerned RevenueSA is seeking such detailed, in-depth information from them, the likes of which have never been requested before, with relatively little notice and during the COVID-19 emergency that has curtailed or closed down businesses. My question to the Treasurer is:

1. Can the Treasurer confirm when his land tax reforms come into force? Is it 30 June in the 2019-20 financial year or from 1 July in the 2020-21 financial year?

2. Why has RevenueSA written to property owners advising the new laws come into effect on 30 June and not 1 July, as you have stated, or is this a typo?

3. Will the substantial disclosures required by RevenueSA that will update its landowners database as at 20 June 2020, being for the financial year 2020-21 land tax purposes and supposedly not earlier years, result in any amended land tax assessments, including penalties for the financial year 2020 or earlier years? I am prepared to take that on notice.

The Hon. R.I. LUCAS (Treasurer) (15:26): I am delighted he is prepared to take it on notice. I am happy to leave it to him. I suspect the honourable member meant he is happy for me to take it on notice and, given the complexity of the questions, there might be some elements—and given the expiration of question time—but I can answer some of the broad questions.

The first thing is that this government isn't interested in any area, let alone land tax, in sleight of hand, so we can reject out of hand any suggestion from anyone, mischievous or otherwise, that the government is up to anything which might be described as sleight of hand. We are open, up-front, transparent and accountable as always and certainly in relation to land tax. As members will know, I have not shied away from the land tax debate through all of last year, although it does seem a long time ago now, given bushfires and COVID-19. Whilst I might be accused of a lot of things, I was certainly up-front in defending the government's position all the way through that, so I reject out of hand any notion of anything being sleight of hand.

The government's major change, which obviously related to aggregation and also in terms of thresholds and new land tax rates for the various classifications or categories, will apply from the financial year 2020-21. There is a legal nicety in relation to land tax: it is calculated for each financial year on the basis of land tax arrangements, as I understand it—and I will stand corrected if I am wrong—at midnight on 30 June of the year, but in relation to the legal complexities of 30 June as opposed to 1 July, I will take that on advisement and come back with a legally correct response.

In terms of the honourable member's constituents, the key issue is that this is in relation to next financial year, which is 2020-21, so the new aggregation provisions and the new thresholds and the new tax rates will apply from 2021. There should be no concern that they are going to be retrospectively applied in some way to 2019-20. In relation to the request for further information, again, we were quite open about that. Because we are introducing a much fairer and more competitive land tax system from next year—next financial year—it does require much more detailed information; for example, trust arrangements, corporation arrangements. All those sorts of things are required as part of the legislation which passed this parliament.

If RevenueSA is meant to make judgements in relation to aggregation, they need to know trust arrangements, who owns what. They need to know, for example, which corporations are related to which other corporations under the provisions of the legislation the parliament passed. So yes, the answer to the question is that more complex information is required of landowners.

There have been some reasonable questions raised in the public arena about letters that were sent to individuals who might have been, they believed, holding exempt land. I know the Hon. Mr Darley has raised in the public arena some examples, and I will be seeking from Mr Darley if he has constituents who are prepared to identify themselves to us. I am happy to undertake to have them checked as to why information was requested of them.

I have been given information that in certain circumstances, even though a landowner might own land that is exempt, if it is, for example, held in a corporation as opposed to an individual there may well be reasons why RevenueSA has sought information from individuals in the circumstances. As to whether or not that is reasonable, I am happy to check any concerns an individual constituent might have as to why information was being sought from them.

With that, I will check the Hansard record. I will have my office check the Hansard record to see what other questions I might not have provided a response to. If there are other questions I have not provided a response to, I am happy to provide them on notice to the honourable member.

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