FOLLOWING a controversial move by the state government to reform land tax legislation, SA-BEST is holding a public forum in Adelaide on Sunday to discuss the ramifications of the proposed changes.
SA-BEST treasury spokesperson Frank Pangallo said the forum was needed to allow the major players to discuss the full impacts of the proposed changes.
He said the proposed land tax changes had sent "shockwaves" throughout the community - not just for those with multiple investment properties - about the effect it would have on the state's economy.
"The state government has got it wrong on this one," he said.
"Not only will hard-working mum and investor investors be unfairly hurt, but so too will small businesses.
"What message does it send to potential overseas and interstate investors - investment in SA and be hit by the harshest land tax rates in the country.
"At the end of the day, any increased costs faced by property owners - whether they own commercial or residential properties - will be passed on to the businesses and tenants that rent those sites."
Mr Pangallo said while SA-BEST supported lowering land tax rates, "it must not come at the expense of the state's economic growth".
From July 1, 2020, investment properties held in multiple trusts by the same person/family will be aggregated together, closing a loophole where some owners hold their properties in individual trusts.
This will mean the land tax will be payable based upon the entire value of the portfolio, rather than on the individual value of each site.
The government's proposed changes are designed to prevent property owners from paying less land tax by splitting their properties into separate trusts.
Land is taxed similar to a person's income - where the percentage rate of tax paid increases depending on the value of their property.
By having various properties in separate trusts, decreases the overall tax needing to be paid by the investment property owner.
"The government's proposed changes are an insult to hundreds of mum and dad investor who have worked hard all their lives to provide a strong financial future for their families," Mr Pangallo said.
"Some say the changes are targeting the 'top end of town' - wealthy individuals/families with multiple properties. That's simply not the case.
"Many who hard-working blue-collar workers who have toiled their entire lives to prepare for their retirements and/or to leave a financial legacy for their children."
The forum is being held at midday on Sunday, August 4, in the Allan Scott Auditorium of the UniSA City West Campus on North Terrace in the Adelaide CBD.
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