Key indulges land tax speculation
By Richard Harman (author)
Speaking on TVOne’s “Q+A” on Sunday the Prime Minister was happy to indulge speculation that the Government might be considering imposing a land tax on absentee property buyers.
He said: “If the thing (foreigners buying property) became a runaway train on us and we were really concerned about it, that’s always an option available. And to be blunt, actually, land taxes are far more likely to deter people than a stamp duty, because Australia, for instance, has stamp duties. People tend to pay it. You only pay a stamp duty once on the way through.
A land tax is an annual thing. Lots of countries have land taxes.”
Its political appeal would be obvious because this was one of the TPP options National offered Labour that they could implement in Government to try and control frozen property buying. But Labour has rejected it.
Data will soon be available on foreign buyers from the requirement impsoed in the last Budget for for them to provide an IRD number.
On Friday, Victorian Treasurer Tim Pallas announced surcharges introduced last year on stamp duty and land tax payable by foreign buyers of residential property would be increased.
Mr Pallas said his budget this week would increase the stamp duty surcharge from 3 per cent to 7 per cent and a land tax surcharge for "absentee owners" would rise from 0.5 per cent to 1.5 per cent.
He said the introduction of the surcharges in 2015 had "no adverse" effect on the property market and foreign investment had continued to grow.
And in New South Wales Treasurer Gladys Berejiklian has declined to rule out introducing similar stamp duty or land tax surcharges for foreign buyers of residential property.