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Land Tax Amendment Bill 2003
LAND TAX AMENDMENT BILL 2003
EXPLANATORY NOTES
GENERAL OUTLINE
Policy Objectives
To amend the Land Tax Act 1915 to implement measures announced in
the 2003-2004 State Budget.
Reasons for the Bill
The 2003-2004 State Budget proposed that the Land Tax Act 1915 be
amended for the 2003-2004 financial year and later years to:
· increase the statutory deduction for taxpayers who are residents
from $200,000 to $220,000;
· increase the minimum tax payable for a financial year from $100
to $350;
· increase the exemption threshold for taxpayers who are
companies, trustees and absentees from $150,000 to $170,000;
· extend the cut-off value for the phasing-in rebate for taxpayers
who are companies, trustees and absentees from $215,000 to
$235,000.
The Bill implements these measures.
Achievement of Objectives
Currently, taxpayers who are residents receive a $200,000 statutory
deduction in calculating the taxable value of their land for a financial year.
In the case of land used solely for the business of agriculture, pasturage or
dairy farming, the statutory deduction is the greater of the unimproved
value of that land or $200,000. The Land Tax Act 1915 is to be amended to
increase the statutory deduction for residents from $200,000 to $220,000.
In the case of land used solely for the business of agriculture, pasturage or
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Land Tax Amendment Bill 2003
dairy farming, the statutory deduction will be $220,000 or the unimproved
value of that land, whichever is greater.
An exemption threshold applies to land holdings owned by taxpayers
who are companies, trustees and absentees. If the taxable value of land
owned by these taxpayers is below this amount, the land is exempt from
land tax. If the taxable value is above this amount, land tax is payable on
the full value of the land holdings. A phasing-in rebate alleviates the
impact of the value being just over the exemption threshold. Currently the
exemption threshold is $150,000, and the phasing-in rebate cuts out when
the taxable value reaches $215,000. The Land Tax Act 1915 is to be
amended to increase the exemption threshold from $150,000 to $170,000,
and to extend the cut-off value for the phasing-in rebate from $215,000 to
$235,000.
Currently, land tax assessments are generally not levied for tax liabilities
of less than $100. This means residents with land holdings of less than
$221,665 (excluding their residence) are not liable for land tax. The Land
Tax Act 1915 is to be amended to increase the amount of tax for which no
assessment need be issued by the Commissioner from $100 to $350.
Consequently, residents with land holdings of less than $275,997
(excluding their residence) will not be liable for land tax.
Finally, the Land Tax Act 1915 requires owners of land to furnish a
return where the land owned has an unimproved value greater than a
specified threshold amount, unless otherwise notified by the
Commissioner. For an owner who is a company, trustee or absentee this
threshold amount is the exemption threshold for companies, trustees and
absentees. For another owner, this threshold amount is the unimproved
value below which land tax payable would be less than $100, after allowing
for the statutory deduction and general rebate. As a result of the increases
to the exemption threshold, statutory deduction and minimum amount of
tax payable for a financial year, a consequential amendment is also to be
made to the specified threshold amount for lodgement of returns. The Land
Tax Act 1915 is to be amended to increase the threshold amount for
companies, trustees and absentees from $150,000 to $170,000, and the
threshold amount for other owners from $221,665 to $275,997.
Alternatives to the Bill
The policy objectives can only be achieved by legislative enactment.
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Land Tax Amendment Bill 2003
Estimated Cost for Government Implementation
Any additional administrative costs are not expected to be significant.
Consistency with Fundamental Legislative Principles
The amendments will commence on 1 July 2003. Although the Bill will
be introduced prior to this date, debate and passage will not occur until
after this date. Consequently, the amendments will commence
retrospectively. However the measures, which will provide benefits for
taxpayers in the form of tax reductions, were announced in the State
Budget and widely publicised before 1 July 2003. Also, the land tax
assessments for the 2003-2004 financial year will not issue until after
enactment of the Bill. On this basis, there are no fundamental legislative
principle issues.
Consultation
Consultation on the amendments was not appropriate as the measures
are a Budget initiative. However, the amendments are beneficial for
taxpayers.
NOTES ON PROVISIONS
Clause 1 cites the short title of the Bill.
Clause 2 states the date on which the Bill is taken to have commenced.
Clause 3 states that the Bill amends the Land Tax Act 1915.
Clause 4 amends section 9A to increase the exemption threshold for
taxpayers who are companies, trustees and absentees from $150,000 to
$170,000. The amendment also extends the cut-off value for the phasing-in
rebate from $215,000 to $235,000.
Clause 5 amends section 11 to increase the statutory deduction for
taxpayers who are individuals (other than trustees or absentees) to
$220,000. In the case of land used solely for the business of agriculture,
pasturage or dairy farming, the statutory deduction for these taxpayers is
the greater of the unimproved value of that land or $220,000.
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Land Tax Amendment Bill 2003
Clause 6 amends section 13 to reflect the effect of the increase in the
exemption threshold for taxpayers who are companies, trustees and
absentees on land that is exempt from tax.
Clause 7 amends section 16 to reflect the effect of increased deductions,
exemption thresholds and minimum amount of tax payable on taxpayers'
obligations for the lodgement of returns.
Clause 8 amends section 18 to increase the minimum amount of tax
payable for which the Commissioner need not levy an assessment.
Clause 9 amends section 62 to provide that the amendments made by
this Bill apply to land tax levied for the financial year beginning 1 July
2003 and each later financial year.
© State of Queensland 2003