A re-elected majority Gutwein Liberal Government will reduce land tax rates for Tasmanians and introduce a Foreign Investor Land Tax Surcharge on residential properties, as part of our plan to modernise land tax arrangements and Secure Tasmania’s Future.
The surcharge will ensure foreign investors are paying their fair share when owning residential properties in Tasmania and contributing more to the essential services and infrastructure our growing state needs.
We estimate the surcharge will raise around $1.5 million per year, allowing us to reinvest the benefits straight back into the community and ease cost of living pressures for Tasmanians by offsetting significant land tax bill increases.
Importantly, the surcharge will not apply to those using land for example, for primary production or commercial properties, or land associated with a principal place of residence.
Similar to other states, the surcharge will be set at 2 per cent, complementing the Foreign Investor Duty Surcharge to level the playing field on property transactions that we introduced three years ago.
Additionally, within 60 days of being re-elected we will task Treasury to consider and provide advice on capping significant land tax increases, as seen in other jurisdictions in the past.
With our economy strong, we expect the next round of land valuations will include significant uplift in property valuations as a result of the very strong growth in our property market. We want to put more money back into the pockets of hard-working Tasmanians, and this will look at the best way forward to alleviate these impacts and reduce cost of living pressures.
And as I announced in the State of the State, we will increase land tax thresholds to reflect today’s strong property market, with the land value at which land tax becomes payable to double from $25,000 to $50,000. The top threshold will also increase by $50,000, from $350,000 to $400,000.
These new thresholds will better reflect today’s strong property market, with around 70,000 landowners, including shack owners, to benefit by up to $613 a year, and 4,100 additional landowners to pay no land tax at all in the year ahead.
The premium penalty rate of interest will be halved from 8 per cent to 4 per cent, and land tax bills over $500 will be able to be paid in three instalments over the year.
This strong plan will level the playing field, ensuring foreign investors are paying their fair share and allowing us to invest more into the essential services that Tasmanians expect. It will also ease the need for increases in rental prices, with our strong expectation that landlords seek to pass on these savings to tenants next year.
Importantly, these changes will only be delivered by a majority Gutwein Liberal Government. Labor’s unaffordable promises cannot be believed or delivered, unless they cut programs, sack staff or tax Tasmanians more.