Thursday, December 6, 2012

6/12/2012: Why was development land left out of Property Tax net?


The Government published the long-delayed and super-secret until now Thornhill Group report into the structuring of the property tax. One point that the report raises is:


"The Group notes the recommendation of the 2009 Commission on Taxation for a recurrent tax on zoned development land and suggests consideration be given to the proposal with a view to supporting proper long term planning and sustainable development. "

Now, the Government has opted for a property tax based on 'market value' assessment. However:
  1. Land is property
  2. Land has market value that can be assessed
Why is development land, zoned land, any other land not covered by the Property Tax?

Budget 2013 measures clearly subsidize financially-instrumented property speculators over those who invest in more efficient use of their homes. With exemption of development land from the tax net, the Budget also subsidizes land banking and land speculation. Once again, at the expense of ordinary homeowners.
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