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The Forum > Article Comments > Tax me, please > Comments

Tax me, please : Comments

By Cameron Murray, published 22/12/2009

People hate taxes, but they are necessary, and some are better than others.

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Nice idea...but like all rational policy choices it will be killed by vested interests.
Our tax policies are regressive by political choice (& demographics).
The switch to progressive economics will not occur unless Australia gets a new political party.
Posted by Ozandy, Tuesday, 22 December 2009 12:40:33 PM
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Interesting idea - my gut is telling me 'no', but I'm still working out why.
I can't entirely agree that the quantity of land would not decline. While it seems self-evident that there is plenty of land around, the reality is that this is not so. Firstly because not all land is actually available to acquire. There are massive land shortages in lots of remote places because so much land is tied up in native title issues. In addition the Crown does not release land at will. Also, not all land is accessible - see the lack of roads/utilities/other infrastructure.
It is sometimes through the exigencies of potential developers and their respective lobby groups that additional land is released. It is also often through the work of developers that large government releases eventually get carved up into usable titles.
I am all for promoting the efficient use of land, but 'land banking' is not always a highly speculative use of land. Land may be banked prior to being rezoned - it can sit for many years before it actually suddenly has any value with a change in coding from rural to residential.
I also query how it will work in practice - is it calculated and paid annually as with rates and current land taxes? As it is a tax on increasing value, are refunds paid in a dropping market?
I think my biggest concern is that land is actually quite expensive as it is and that adding a tax to it will only make it more so. In fact, this might be the only real change - speculators and land-bankers will simply continue on the same way but charge more for the land - exacerbating the existing problems.
Just some preliminary thoughts as requested.
Posted by J S Mill, Monday, 4 January 2010 2:42:49 PM
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Are you kidding? Land tax is ALREADY HIGH !! The top rate in NSW is 2% on UCV! I have houses only returning 2%. Admittedly this is on the total value however one house where the Land Tax takes away 40% of the Rental Income! Yes I should probably sell it and get into something that does make money.

Higher Land Tax will create less of something .... it will create less Landlords! Why would you want to be a landlord with such pathetic returns.. you would do better in the share market. So the governments are basically telling us to sell our rental property investments and become owner occupiers (thus getting the land tax exemption on principle place of residence), and then they can slug us for more Stamp Duty every time we move.

This would increase the percentage of home ownership, but is this a good thing? Having a good supply of rental properties makes for a more mobile workforce. The decision to move cities for example becomes easier if you are a renter. If you own your house you are punished with a huge Stamp Duty when you swap houses.

I do agree land tax is an effective tax to maximise the use of land but I think that it should be applied at a higher percentage to commercial land only. Residential land tax should be very low and the exemption you get by living in the property should be abolished. It unfairly discriminates against workers who cannot find work in the same location as their house.

Stamp Duty on Sale of properties should also be abolished, but that is another story. What irks me the most is that all this money is going to some of the most inefficient enterprises in Australia namely the state governments. They still think they know how to run hospitals... give me a break!
Posted by lloydrough, Friday, 8 January 2010 3:15:11 PM
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A land based tax system would in my opinion not help out the tax system, a small percentage of people own land compared the the large amount of people who do not, most taxes come from the large amount of low income people. Taxing the higher income generating people will not result in a more fair tax system. I personally believe only transaction should be taxed as another solution. Good article and interesting opinion. thanks!

Source: http://income-tax-calculator.org
Posted by Income Tax Calculator, Sunday, 10 January 2010 3:12:14 AM
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@ Tax Calculator - if you wouldn't mind it would be most helpful if your website actully mentioned exactly what field is incorrect when trying to make use of it - nice idea, however some of us choose not to use the ubiquitous doze (and for obvious reasons). we find it very frustrating when yet again another webdesigner shows they took the lazy, non-thinking M$ way out!
Posted by vajras, Sunday, 10 January 2010 4:36:42 PM
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