Author: Mike Danzey
Bondi, Newtown & Bronte
Consider two blocks of flats in Bondi and Newtown. Both were exclusively rental housing stock but NSW State Land Tax was a prime factor in enforcing their subdivision into strata allotments. As exclusively rental housing requires a freehold site, only one tax-free threshold is allowed when subdivided into strata lots.
Pittwater
Pittwater freehold housing (like many other local government areas) has been targeted with State Land Tax rate 1000% higher than the Pittwater council residential rate.
State land tax is designed to undermine freehold rental housing and holiday accommodation but media reports on the damage state land tax inflicts never raise the ‘How’ and ‘Why?’ questions.
Housing Inquiry 2004
Submission to raise issues how State taxation policies in N.S.W. target low/medium rental housing (in SEPP10 districts) while State Planning/Housing Policy seeks to retain buildings “exclusively rental stock” and source Government subsidised housing that encourages councils to offer F.S.R. bonuses.
Download the full document Housing Inquiry 2004 (PDF)
Valuation of Land Act – Letter to Julie Walton
Letter to: Ms Julie Walton, Chairperson, Valuation of Land Inquiry
Dear Julie,
Thank you for the opportunity to place some brief comments before your Inquiry, and including comments (26-3-99) to Legislative Council Standing Committee re Land Tax.
My comments are directed to the impact upon Residential Land used as Rental Housing and Premium Property. The principles and practices the current Valuation Methodology applies are well established, although Land Valuation is not an exact science as opinions to qualify and quantify, market sensitivity between different zoning – location and physical features etc becomes educated guesswork.
The Valuation of Lands Act 1916 requires the Valuer General to value on mass each parcel of land reflecting its Highest Economic Use with the sale price of Vacant Land, often referred to as knockdown. In established urban area (Example SEPP10), Vacant Land sales are rare, and supply and demand are distorted as all parcels are valued as though each will be offered in isolation for sale on a market where such Vacant Sales are rare and demand high.
The Valuation Methodology used to impose Land Tax upon Rental Housing and Premium Property, particularly conventional housing in established suburbs, exploits unmercifully supply and demand factors to maximise Tax on Rental Housing and Premium Property.
C.J. [Mike] Danzey
August 1999