Page 2301 - Week 09 - Tuesday, 15 September 1992
Next page . . . . Previous page . . . . Contents . . . . Debates(HTML) . . . . PDF . . . .
Madam Speaker, I would also like to say to members, once and for all, that people who invest in residential properties do so for a variety of reasons. Those reasons might include obtaining income from rent; they might include maximising taxation benefits, for example through negative gearing; they might include achieving a capital appreciation. In other words, Madam Speaker, people who invest in residential property do so with the same sorts of motives as do people who invest in commercial land of other sorts. By maintaining land tax on all types of investment properties, I do believe that the Government is acting responsibly to protect the interests of the community and of other taxpayers. This can be contrasted with the approach of the Opposition.
I also believe, Madam Speaker, that Mr Moore has made comments about land tax being charged on the principal place of residence in some cases. I am not proposing that. Mr Humphries's granny flat is safe. Mr Kaine, I think it was, is renting out a room in his house. Providing that is his principal place of residence, he is safe as well.
Mr Kaine: I beg your pardon? I am not renting out anything. I live in my house.
MS FOLLETT: Perhaps it was Mr Cornwell. It was one of you. It might have been Mr Cornwell, Madam Speaker. As I say, the Government's approach on this Bill is very much at variance with that of the Opposition. A review of Mr Kaine's Bill and his presentation speech plainly shows, and Mr Kaine has been up-front about it, that he would have taken the easy way out by either removing this tax or expanding the exemption provisions beyond reasonable bounds and actually allowing avoidance schemes to thrive under some very vague and ill-considered criteria.
Madam Speaker, I believe that it is necessary for the Government to act responsibly. It is also necessary for us to maintain an adequate revenue base. At the same time the Government is aware of and sympathetic to, as I have already indicated, cases where the current land tax legislation has resulted in some unintended applications of land tax. These were referred to in the presentation speech that I made in relation to the amendment Bill. I referred to a number of difficulties that the commissioner was experiencing in administering the current provisions, and the Government's Bill addresses those difficulties. Mr Kaine's Bill, on the other hand, Madam Speaker, exacerbates the problems of the current legislation by introducing even vaguer provisions and by transferring all of the hard issues to the commissioner by increasing the use of discretion in determining the tax liability.
I would like to refer to a couple of areas of Mr Kaine's Bill which I think make it completely unworkable. The first is the matter of whether or not a residence is actually used to produce income. Paragraphs 4(a) and (b) of Mr Kaine's Bill replace the exemption for principal place of residence of the owner with a much broader class of exemption for residential land. Madam Speaker, where this becomes completely unworkable is that the word "income" is not defined and you would therefore fall back on the normal dictionary meaning of the word, I believe. So the property is land taxable if the residence is occupied by a person and it is also used to produce income; for example, a home business like that of a doctor or a hairdresser, or even part-time or casual income such as a second job like dressmaking or car repairs.
Next page . . . . Previous page . . . . Contents . . . . Debates(HTML) . . . . PDF . . . .