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Land tax- why isn't it calculated nationally?

Discussion in 'Accounting & Tax' started by JesseT, 6th Mar, 2016.

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  1. JesseT

    JesseT Well-Known Member

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    After hearing about the labor government wanting to reduce negative gearing and reduce the CGT discount, it left me wondering if the government would ever focus their attention on calculating land tax nationally, they are always going to want more tax and it seems like they are happy for it to come from property investors.

    My investment strategy is to continue buying in different states of Australia as their cycles come and go not only for the diversification but also the land tax advantage.
    If the current land tax ruling was ever to change, some of us would certainly feel the pinch.

    So, why is it that every state has a different land tax threshold?
    Why does the ATO let us avoid land tax by investing in multiple states?
    Is there a threat of this ever changing to being calculated nationally?
     
  2. Biz

    Biz Well-Known Member

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    It's got nothing to do with the ato. It is a state tax raised by the states office of revenue.
     
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  3. York

    York Finance Broker Business Member

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    Land Tax is a state tax administered individually by states.
     
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  4. D.T.

    D.T. Adelaide Property Manager Business Member

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    Same as stamp duty. States need to get some income to pay for their responsibilities too.
     
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  5. Scott No Mates

    Scott No Mates Well-Known Member

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    Brilliant idea. Remove individual state thresholds and have the same threshold applied to all property across the country. Real popular and vote winner, not!
     
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  6. JesseT

    JesseT Well-Known Member

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    I see, makes sense, thanks for the info, I apologize for the noob question!

    Unlikely then that the ATO could ever take over with a national land tax?
     
  7. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    Laws would have to have a huge rewrite for this to happen
     
  8. wategos

    wategos Well-Known Member

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    Better move for the states would just be to remove the land tax threshold for non-residents in that state, ie only one threshold possible nationally. Plus get rid of the avoidance loopholes like trusts.
     
  9. kierank

    kierank Well-Known Member

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    ... and I can't see the States giving up this revenue stream easily to the Federal Government to collect and the States having to argue/negotiate like they have to do with the GST. Too much self interest, in my opinion.
     
  10. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    Huge revenue for the states in land tax and stamp duty. They can manipulate income by increasing or lowering either of these and can also maintain some independent contol by encouraging or discouraging investment in property.
     
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  11. Paul@PFI

    Paul@PFI Tax Accounting + SMSF Business Member

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    And the Constitution.
     
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