Labor leader Peter Malinauskas emerged from a morning caucus meeting to declare the Opposition would not support the legislation, making its passage through the Upper House seemingly impossible with SA Best and independent John Darley set to block the Bill.
Despite several Labor insiders privately flagging their preference to wave the legislation through, Malinauskas declared the Opposition “will oppose this Bill not because it’s politically expedient but because we believe it’s the right thing to do”.
He said the party would oppose the legislation – which seeks to crack down on aggregation measures while lowering the top rate at which land tax is levied – “principally because we’re concerned about the impacts this will have on small business and growing the economy”.
Malinauskas said SA’s perpetually high unemployment rate “requires having a state government and parliament that always makes the job creation question the highest order priority, which is why Labor has resolved to oppose this bill”.
It came only hours after Lucas brokered a compromise – first reported by InDaily last night – that would further increase the threshold at which the top land tax rate kicked in, a deal that won the assent of the influential Property Council.
That’s despite the industry lobby group having long stated it would not support a Bill that contained the aggregation clampdown – a measure that other industry groups continue to vehemently oppose.
Master Builders SA CEO Ian Markos today reaffirmed “our strong opposition to land tax aggregation [which] combined with the state-wide revaluation is likely to lead to significant land tax bill increases for many of our members”.
“We are concerned about the impact this will have on housing affordability and therefore job opportunities for tradies, apprentices and suppliers,” he said.
The UDIA meanwhile sent members a missive declaring the new changes “not good enough”, and emphasising that they “and other property associations were not consulted on these changes and our key concerns have not been addressed”.
It’s understood many investors have registered their anger about the Property Council’s about-face.
One, who did not want to be identified, told InDaily: “I’m not happy about it, and I’ve made that clear directly to those involved within the Property Council.”
They said the move to deal privately with the Treasurer after the consultation on the Bill was concluded was “just abhorrent”, adding: “I’m very annoyed, and I’ve expressed it to those individuals.”
Another land tax reform critic, lawyer Richard Solomon – who has registered the protest movement “True Liberals” – wrote on Facebook that “if the Property Council folds and discredits themselves that will come back to haunt them very quickly”.
“The gains to the top end with the rate coming down now will prove to be illusory with aggregation and future revaluations to come,” he argued.
Malinauskas said the way the changes were wrought was a “very bad example of policy being made on the run”, with the Government “talking to one group over another, seeking to buy off one family over another… it’s not a good sign of a government that has their affairs in order”.
He made a pitch to the so-called “mum and dad investors” who had attended Labor’s land tax forums, highlighting “postwar migrants who have come to this country and done nothing but worked hard and played by the rules”.
“Labor has heard your call – your voice will not go unanswered,” he said.
But Labor strategists privately believe they will come out winners whether the Bill passes or not, and that they can harness a groundswell of support from disaffected Liberal voters by opposing the legislation.
One caucus insider said the meeting was a “really respectful discussion” that canvassed a “fair gamut of views”.
John Darley, when informed by InDaily that Labor would oppose the legislation, replied “Oh, good”, adding: “Goodnight, Irene!”
However, he didn’t shut the door on reaching a compromise on the legislation, saying: “Who knows? They’ve had three goes already, you never know what they’ll do now – they might even start talking commonsense.”
“But as it stands now, it’s gone,” he added.
The Government’s got a position… and that remains our position at the moment
Lucas was stoic about the latest setback, telling InDaily: “It ain’t over till it’s over.”
“These things are never over until the final vote,” he said.
“We’re pretty confident we’ll get it through the House of Assembly [but] on the current public statements it will be difficult for the Government to get it through the Legislative Council.”
Significantly, though, he did not rule out further changes to his troubled legislation.
“The Government’s got a position, and that’s our position,” he said, while conceding that the Government held a different position as recently as 24 hours ago.
“We’ll see what happens as we progress the Bill through the House [but] that remains our position at the moment,” he said.
“That’s the position we’ll be talking to the parliament.”
If Labor faced dissenting views in today’s caucus meeting, last night’s Liberal party-room was a volatile encounter.
It’s understood at least one MP present at the meeting flagged a desire to reserve their rights to abstain or cross the floor against the legislation, but were persuaded to fall into line and back the Bill.
Two other MPs, right-wingers Dan Cregan and Steve Murray, had already flagged that they would reserve the rights, however it’s believed they indicated their preference was not to cross the floor but abstain.
Neither returned calls today.
Party sources today suggested Cregan has now privately indicated he will likely back the Bill, although it’s unclear whether Murray – who has previously been outspoken in his opposition to the aggregation measures – still intends to abstain.
Premier Steven Marshall was today asked by reporters if all MPs were present for last night’s meeting, answering that “from time to time there are people missing from joint party-room” but insisting “all people that were present supported our changes or amendments to the Bill”.
He told reporters the parliament “has a very big decision to make”, saying: “We’re up for reform – it’s difficult but it’s necessary in SA.”
Lucas today affirmed he was “confident all government MPs will support the Bill”.
“What we need to convince is not our party, but the Labor Party and the crossbenchers that this Bill’s worthy of support,” he said.
One of those crossbenchers, SA Best MLC Frank Pangallo – one of the Bill’s most vocal critics in parliament – reiterated his party’s opposition today, saying it “still doesn’t address the lower end of the market and could have a disastrous effect on the property industry”.
“The Treasurer’s got to take responsibility for this, it’s been an ill-conceived measure right from the beginning and it still hasn’t gone far enough,” he said.
However he too left the door ajar for compromise, suggesting removal of the retrospective nature of the aggregation clampdown or increasing the threshold at the lower end could swing his support.
“If they revisit grandfathering we’ll certainly have a look at it again,” he said.
“I don’t want to see small investors being hurt unnecessarily… it can be made fairer and that’s what they need to do.”
Lucas earlier told reporters parliament “now has a once in a generation opportunity for comprehensive land tax reform with a capacity to drive investment and jobs in SA”.
“I can guarantee if this package is not passed, no government, Labor or Liberal, will go anywhere near comprehensive land tax reform for the next 20 or 30 years, and industry investors in SA will be left with a 3.7 per cent top land tax rate – the most uncompetitive land tax regime in the nation,” he said.
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