Backbenchers have privately expressed outright anger about the move by Treasurer Rob Lucas to change the way land tax is aggregated for owners of multiple properties – a move budgeted to bring in an extra $40 million a year.
But business insiders and lobby groups argue the true figure will be much higher, with Property Council executive director Daniel Gannon telling ABC radio today the stated saving was “a very soft estimate”.
“The Government hasn’t revealed any modelling around $40 million – we think it will be at least double that particular amount,” he said.
But as cabinet met this morning for the first time since Premier Steven Marshall returned from a fortnight’s leave, Primary Industries Minister Tim Whetstone told Channel 7 reporter Mike Smithson: “We don’t even know what the impact will be.”
“I think there needs to be a little clarity of what it means for SA,” he said, arguing there had been “a lot of unfounded emotion” in the public outcry.
Pointing out that the Government was still consulting before legislation was formalised, Whetstone said: “If people could go and work out exactly what impact it would have on them, we could deal with the issue.”
But many in the business community are doing just that, with prominent entrepreneur Ben Fitzsimons taking to Facebook over the weekend to declare that his land tax bill was “set to increase by around $200,000”.
“For the first time in my life I am considering leaving South Australia,” he wrote.
“I’ve always been that guy that argued with friends to stay, to see the positives to support SA because I thought it was a great place to live and raise a family.
“I’ve just opened a council rate notice that has seen my rates increase 57 per cent in one year – that means my cost to tenants will increase by 57 per cent.
“This means that the investment properties I have now will not make any money for my family anymore.”
Fitzsimons also cited a friend “whose freehold investment property is set to collect less rent than what the land tax payment will be”.
“These raised costs mean that the cost to do business will increase to unsustainable levels; it means business will close which means less employment opportunities; it means more vacant buildings; it means a looming housing crash where mums’ and dads’ homes will be devalued; it means bankruptcy being commonplace,” he wrote.
“All because of the South Australian Liberal Party.”
The falling out with the party’s core constituency has inflamed tensions ahead of a joint party-room meeting late today, before the Government faces a grilling from the Opposition in budget estimates later this week.
During a media conference about the South Eastern Freeway upgrade this morning, conservative backbencher Dan Cregan pointedly refused to say whether he would consider crossing the floor to vote against the legislation.
“I think the minister has answered that question,” he said.
“We look forward to a discussion in the party-room.”
Transport and Infrastructure Minister Stephan Knoll, a fellow right-winger, told reporters the moderate-backed Marshall had “done a fantastic job” leading a government that “delivers what it says it’s going to do but also takes the hard decisions to deliver a budget surplus”.
“That was one of the key commitments,” he said of the surplus.
But he was coy about the party-room debate, saying: “What happens in party-room is going to stay in party-room… we often have robust discussions about a whole range of topics.”
Whetstone, asked if Marshall was under pressure, said: “I think there’s pressure on the Premier every day.”
“We’ve got a $515 million GST shortfall, and South Australians have to acknowledge that at some point in time.”
“Land tax, at the moment, is a distraction,” he said.
“The Premier’s been away for a few weeks and I’m sure he’ll be dealing with it this morning in the cabinet room.”
Fellow frontbencher Dan van Holst Pellekaan was similarly non-committal, telling Channel 7: “I’m always listening to the public, of course.”
“The reality is, people are allowed to express their feelings [and] we welcome people sharing their views.”
“There are endless things the public thinks we’re doing very, very well, and there are things they think we’re not doing quite right… we look at everything we receive from the public, and focus on what’s best for all South Australians.”
Andy Gilfillan, the Liberals’ former state election candidate for Mawson, commented on the furore on Facebook, arguing it was “all in response to a shortage of GST revenue” and it was “time for a discussion about a 12.5 per cent GST”.
“[That] needs all states to agree then get rid of payroll and other handbrake taxes,” he wrote.
“And why does SA not have road tolls – user pays surely!!’
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