Page 2293 - Week 09 - Tuesday, 15 September 1992
Next page . . . . Previous page . . . . Contents . . . . Debates(HTML) . . . . PDF . . . .
also need for consideration of the circumstances of collecting that land tax. If land tax is paid yearly in advance, it can become a heavy burden for small investors. With the provision of quarterly payments, the liability is spread across the whole year so that there is a chance to earn at least some of the income before the land tax bill must be met. As a community we expect that all people should be treated fairly, and I feel that this proposed amendment makes the collection of land tax a more equitable practice. While there is a small penalty attached to paying quarterly, this is small in comparison with interest rates that would be charged by lending institutions for loans to cover the payment of the tax.
In terms of the other areas addressed, I feel that the Government's amendment Bill is to be applauded. I feel that it is a positive step to introduce the payment of interest in circumstances of the overpayment of tax, so that those who pay in good faith, and then are either exempted or a decision is made that they have paid too much, will not have lost any income from that decision making process.
I note that the Government charges a 20 per cent penalty for late payment but will be paying only market interest rates. This anomaly may be appropriately addressed at another time; but I would like to point out to members that the Australian Tax Office, which until recently has charged a 20 per cent penalty on late payment of income tax, has now moved to a sliding scale of interest on late payments. After the passing of the Taxation Laws Amendment (Self Assessment) Bill 1992 the interest rates for late payment of income tax will be made up of an 8 per cent penalty component, which is not tax deductible, and a component made up of the Treasury weighted average, plus 4 per cent, which will become tax deductible in the following tax year. While sounding complex, this is in reality no more complicated than tying the refund interest rate to a market rate.
The Government has also moved to tighten definitions of work related exemptions and exemptions on compassionate grounds, to change the redetermination guidelines to allow yearly rather than three-yearly reviews, to extend exemptions for people living in a house under the terms of a will, and to extend the tax to all parts of a complex of residential flats not used as the owner's principal residence. This amendment Bill is extensive, and it seems that it will be administered in a fair and equitable manner.
I understand that the Leader of the Opposition was attempting, with the introduction of his amendment Bill, also to make it a fairer tax which would not impose a burden on people who were not earning an income from their property; but, on my reading, what the Bill did was to effectively make the imposition of land tax unworkable. It attempted to be overgenerous in its exemption categories, leaving only a few landlords to pay the tax. The introduction of the amendment Bill is admirable, however, in its attempt to draw attention to existing anomalies in the Rates and Land Tax Act.
Madam Speaker, many of the complaints that I have received regarding the first round of land tax assessments related to the time that it took to be informed of the final decision. While this is of concern, and I would hope that mechanisms would now be in place to avoid further delays on applications for exemptions, there are other ways to manage this, rather than undermining the imposition of the land tax and making it in the interests of people to complicate their financial and property dealings.
Next page . . . . Previous page . . . . Contents . . . . Debates(HTML) . . . . PDF . . . .