Page 3983 - Week 13 - Thursday, 17 October 1991
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additional costs to the property owner of $400 per annum. This represented 0.26 of the total cost of the investment and it was considered that it would have negligible effect on the return of the investment. In addition, as land tax could be claimed as a deductible expense against income, it was considered most unlikely that the imposition of the tax would jeopardise the investment housing market in Canberra.
c) The potential revenue which could be raised by the
introduction of the land tax.
ACT Treasury research had shown that land tax revenue based on all rateable ACT land other than land used in primary production and as an owners principal place of residence would amount to $6.3 million in 1991/92 and $6.9 million in 1992/93. Exemptions from the tax mainly .related to absences by an owner from a principal place of residence have reduced the revenue to $5.3 million and $5.9 million respectively. If a threshold below which tax is not charged had been introduced it would have reduced revenue considerably, to somewhere between $1 and $3 million, depending on the level of the threshold.
d) The possibility of the land tax being passed directly to
tenants and the impact on the cost of private rental
accommodation in the ACT.
Australian Bureau of Statistics AM statistics from the 1988/89 Household Expenditure Survey indicated that.the average weekly income of households renting privately was $887.43, nine percent above the ACT average of $814.13. In the average private rental household there were 1.8 employed persons, 20% greater than the number in the average household in Canberra. 35% of private rental households were group householders compared to 13% for the whole of Canberra.
The Government is fully aware that the burden of the land tax cost may be passed on to tenants. The ability of property owners to pass on the burden of the tax, in full or in part, however,
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