Land tax revamp ‘a grab for cash’

THE State Government is pushing ahead with a change to property valuations that its critics have called a $200 million “tax grab”.

From 2019 the Government plans to move to annual property valuations instead of every two years, which the budget shows will swell state coffers by $200 million that year.

It hopes to remove opposition from local councils — which now perform valuations — by agreeing to pay the extra costs associated with yearly valuations.

Treasurer Tim Pallas said the change would mean more gradual rises in land tax.

But the Opposition and council valuers say the rejig will lead to a huge tax windfall.

Annual valuations were taken out of June’s Taxation Bill after local councils were concerned they would be hit with an extra $20 million bill every other year.

But the Government is so determined that Mr Pallas has assured local governments he will pay for the extra administrative costs and software upgrades associated with the change. It will also reimburse councils lost revenue from selling property data.

The Government will reintroduce the measure, and a plan to centralise valuations with the Valuer-General Victoria, in the Spring Taxation Bill likely to be introduced to Parliament in coming weeks.

The Municipal Group of Valuers said there was no doubt that in a rising property market the Government would net more from land tax.

Its 16-point rejection of annual property valuations said the move would create less accurate property data and council rate bills would become more unpredictable.

Property Council of Australia executive director Sally Capp said the best way to smooth out land tax fluctuations was to move to threeyear rolling averages.