Finally, a Tax I Agree With
While most ideas for new taxes should be dismissed out of hand, one recent proposal has considerable merit. The best thing is it won't cost you anything.
Over the years, I have learned that the 'tax reform' agenda pushed by politicians and bureaucrats can be loosely translated as taxing people more.
Rarely is there a proposal put forward to lower the overall tax take permanently. Instead, the architects throw a few tax scraps to satisfy immediate desires while building long-term tax growth into the mix.
The move from stamp duty on home purchases toward an annual land tax is a case in point.
Stamp duty is a ridiculous tax and is just a means of government raising revenue. However, once it is paid, it is paid and can only be charged again once the house is sold.
Offering an annual land tax appeals to the many people who see the lump sum of stamp duty contributing to housing unaffordability.
It also suits the government over the long term.
That's because the lumpy sporadic stamp duty becomes an annual growth tax that can be tinkered with at the tap of a keyboard.
Once a property owner is on that system, they have no option but to pay whatever is demanded or risk losing their landholding.
It makes a mockery of property rights, but we see such measures in council rates, water and sewerage and temporary taxes like South Australia's Emergency Services Levy.
They are all de-facto wealth taxes levelled on something you cannot remove from the system.