Page 3585 - Week 12 - Thursday, 19 September 1991
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commercial properties. The fact is, of course, that in the ACT the rate of land tax is significantly lower than that which is charged in New South Wales and indeed other States. New South Wales has a tax rate of 1.5 cents in the dollar, or 1.5 per cent, whereas the land tax rate in the ACT has, under the previous Government's administration, risen to only one per cent, or one cent in the dollar.
That is a factor which must be taken into account when discussing the whole issue of thresholds and whether a particular value needs to be taken into account when providing discounts to persons who may have to pay this tax. So, from a number of points of view, I think both sides in this debate have not actually been all that honest. Quite rightly, the people who own investment properties have lobbied quite strenuously to not have the tax burden imposed upon them.
Mr Moore: That is their prerogative.
MR DUBY: That is their prerogative, as Mr Moore says. They have said that investments have been made here on this basis or that basis and that we are now changing the rules. But, on the other hand, as I said, these facts about thresholds, about comparative rates between the ACT and New South Wales, et cetera, have not also been pointed out. It also has not been pointed out generally by those folk that, of course, this tax is an income tax deduction in almost all cases. I cannot think of a case where this tax would not entail a Federal income tax benefit for the person.
On the other side of it, we also have the Government saying, "We are simply extending the tax; it already exists", et cetera - and denying that this tax will have any effect on the market. It is clear bunkum to deny it. It will have an effect on the market, and that is really all there is to it. Luckily for the Government, there are already in place provisions which will provide assistance to those tenants who are in private rental accommodation and who are on a low income. Luckily for the Government, those provisions are in place, so they can then still beat their breast and say - - -
Mr Berry: We did think of that. It did cross our minds.
MR DUBY: I maintain that it would not have mattered whether those provisions were there or not, because you would have introduced this extension of the tax, anyway. The fact is that, because of your bad budgeting you need the money. That is the fact, and no-one disputes that.
But, as I said, it is wrong for the Government to suggest that this measure is not going to have an effect on the market. Actually, the person who is going to wind up suffering out of this is the long-suffering middle-income earner; that person who is earning just a little bit over $20,000, who is not eligible for rent relief or anything like that and who will undoubtedly have to find additional
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