Media Release 01/02
Prosper Australia is elated to hear that the Brumby government is returning to its senses by recognising Land Value Capture as the most efficient way to raise public revenue. However, the progressive tax tiers need to be rolled into a flat tax.
“Land Tax is the most efficient of all government revenue raising systems as it incurs the least deadweight costs on economic transactions,” said Prosper Australia spokesperson Karl Fitzgerald today. “This is widely accepted by economists. However, it is not very popular with those who like to engage in asset protection, otherwise known as tax dodging.”
“The progressive Land Tax rates can be flattened as location naturally captures the higher incomes associated with proximity to services.”
“The government needs to recognise calls from business for a reduced tax burden and less red tape. By offsetting the higher tax take with the removal of payroll tax, the government will help develop Victoria’s competitive advantage.”
“Premier Brumby should look back to the 2001 Harvey report that he commissioned. The report recommended the flattening of Land Tax and its increase to write off other less effective taxes.”
“Land Valuations must be made yearly. Modern technology makes this possible. It’s unacceptable that businesses get large bills every two years when these bills could be split into quarterly accounts.”
“Prosper Australia is concerned with the government’s move to increase the Land Tax threshold from $200,000 to $225,000. This means that speculators and land bankers alike can bid up the price of land, forcing the Great Australian Dream further beyond the youth’s reach. With land constituting over 80% of any auction price, the Land Tax threshold should be abolished as per the Harvey report.”
“If speculators are deterred from the market with a decent Land Tax, the rampant 25% land price jumps we saw last year will no longer outstrip the ordinary Australian’s ability to afford a place to live.“
“Ultimately, all present taxes should be completely replaced with a flatter, higher Site Rental on all land. Then economic rents will be captured as the natural source of government revenue. “
ENDS
Contact Prosper Australia
Karl Fitzgerald – media@prosper.org.au
03 9670 2754
www.prosper.org.au
Prosper Australia is Australia’s largest and oldest organisation concerned with the capture of economic rent for justice and freedom for all.
Reference Points
The Age – Land Tax shock
Treasurer Lenders – check last 2 sentences
