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Legislative Assembly 269 LEGISLATIVE ASSEMBLY Wednesday 24 May 2006 ______ Mr Speaker (The Hon. John Joseph Aquilina) took the chair at 10.00 a.m. Mr Speaker offered the Prayer. Mr SPEAKER: I acknowledge the Gadigal clan of the Eora nation and their elders and thank them for their custodianship of this land. LOCAL GOVERNMENT AMENDMENT (MISCELLANEOUS) BILL Message received from the Legislative Council returning the bill without amendment. AUDIT OFFICE Report Mr Speaker tabled, in accordance with section 38E of the Public Finance and Audit Act 1983, the performance audit report of the Auditor-General entitled "Prisoner Rehabilitation: Department of Corrective Services", dated May 2006. Ordered to be printed. VISITORS Mr SPEAKER: I welcome to the public gallery students and teachers from St Catherine's School, Waverley, as guests of the honourable member for Coogee. I hope they find today a pleasing and educational experience. I have been informed that the school is celebrating its 150th anniversary. On Monday this Parliament celebrated its 150th anniversary of responsible government, with the establishment of the Legislative Assembly on 22 May 1856, the same year as the establishment of St Catherine's School. VALUATION OF LAND AMENDMENT BILL Second Reading Debate resumed from 10 May 2006. Mr ADRIAN PICCOLI (Murrumbidgee) [10.05 a.m.]: This Parliament is celebrating 150 years of responsible government, which is an incredible achievement, just as the 150-year anniversary of the establishment of St Catherine's School is an incredible achievement. One hundred and fifty years ago soldiers who had fought with Napoleon were still around, and I believe Queen Victoria was still Queen of England. Mr SPEAKER: And very much still a young Queen. She remained Queen for another 46 years or so. Mr ADRIAN PICCOLI: I am sure St Catherine's School has an amazing history and that an incredible array of people attended the school and contributed greatly to Australia. Our guests this morning who are present in the gallery will probably also make a fantastic contribution to Australia. I congratulate the school on its 150th anniversary. The Valuation of Land Amendment Bill is not quite as exciting as the 150th anniversary of St Catherine's School, but it is an important piece of legislation. The New South Wales Coalition examined this legislation carefully and does not have a problem with a number of minor amendments to the Valuation of Land Act 1916. Opposition members accept that the amendments will clear up some anomalies, clarify some definitions and bring the bill into line with decisions handed down by the Land and Environment Court relating to the interpretation of certain provisions in that Act. As I said, the Opposition does not oppose those aspects of this legislation. However, Opposition members have been concerned for some time about the way in which land is valued in New South Wales. 270 LEGISLATIVE ASSEMBLY 24 May 2006 We do not think this bill addresses faults in the New South Wales valuation system. That is not the intention of this legislation but the people of New South Wales are waiting for significant changes and reforms to the way in which land is valued in New South Wales. Over the past few years we have witnessed huge increases in land valuations, which has resulted in massive increases in land tax bills. These increases have impacted on council rates and resulted in huge variations in land valuations. There must be a significant reform of land valuations in New South Wales, which is something this legislation does not deliver. Opposition members will await with anticipation the legislation that is to be introduced later this year in response to the recent Ombudsman's report. Many people in the community are hurting because of the way in which their land is valued. Over the past few years the actual value of real estate has declined right across the State. People are paying high levels of land tax but at the same time the actual value of their land is decreasing. The greatest complaint my constituents have is that this Government takes very little account of their ability to pay these land tax bills. I have received complaints from constituents, family friends who live in Sydney and from members of Parliament about the land tax bills being faced by people living in Sydney. In regional New South Wales, particularly on the coast, land valuations have skyrocketed, and the issue is most pressing there and in Sydney. We have all heard stories about people who own a second house in Sydney that they rent out for a couple of hundred dollars a week and who suddenly face a land tax bill representing up to 50 percent of their rental income. This is where the rubber hits the road in regard to land valuations; it is about how much people are forced to pay in land tax. That brings me to the Valuation of Land Amendment Bill and the first section of the bill relating to the powers of the Valuer-General to make land valuations at any time where the circumstances of the land have changed. I understand that this clause is fairly narrow because it only gives the Valuer-General the opportunity to undertake revaluations at his or her discretion when the circumstances of a particular parcel of land have changed. In relation to a rental house, a block of units or a vacant block of land the Valuer-General cannot just go in whenever he or she feels like it and change the valuation. But where there has been a rezoning or subdivision, or where the nature of that land has changed, under this legislation the Valuer-General has the power to undertake a revaluation. Prior to this bill, the council or the Commissioner for Taxation in New South Wales could request that that revaluation be done. This legislation allows the Valuer-General at his or her own discretion to do that revaluation. We accept that it is not necessarily going to impact on many people, but the community is concerned about land valuations and land tax bills increasing hugely. In a private member's statement in the last week of Parliament I referred to an example of constituents of mine whose land tax bill had gone through the roof—I think it had gone from zero dollars to about $5,000 in the space of two years. Some people have a real problem with the way their land is valued and people are very upset about those kinds of huge increments. We do not think that this legislation assists the situation in any way. We are reluctant to give any additional power to the Valuer-General to revalue land at his or her own discretion. That is why the New South Wales Liberal and National parties oppose this legislation. We do not believe that the Valuer-General should be given additional powers until significant reforms are made to land valuations in New South Wales. The way land valuations are done now is causing enormous difficulty for people who are investing in land for their retirement, or those who have bought real estate and have seen their valuations increase hugely, they think unjustifiably, sending their land tax bills through the roof. It is creating a massive disincentive to own real estate. We have seen changes to superannuation tax in the Federal budget; a lot of money will be washing around in superannuation funds. But there is very little incentive to invest in real estate in New South Wales when people have to pay stamp duty to buy it, and they have to pay land tax and rates, and all these sorts of things. This situation is going to impact on the availability of rental properties: it is going to force up the price of real estate; it is going to force up the cost of rents. When one compares that to the ease of owning shares with no stamp duty to pay on the purchase or sale of shares, no on-costs for owning shares, no land tax or rates, the incentive is greater to invest in the stock market than to invest in land. That is why we need significant reforms to land valuations. The Government has made some announcements about this, but reforms need to be put in place very soon. The New South Wales Government makes a lot of money out of land tax, and of course the Government needs money to run a government, but it is unfairly gouging out hundreds of millions of dollars from people who are going to have difficulty paying their land tax bills. That is why the Coalition in New South Wales will oppose this legislation. We want to see significant reforms to land valuations in New South Wales. When those significant reforms are introduced, either by this 24 May 2006 LEGISLATIVE ASSEMBLY 271 Government in the lead up to the next election or by a Coalition government after March 2007, then we will look favourably at giving the Valuer-General greater discretion and greater powers. But until such time, we will oppose this bill. Mr GEOFF CORRIGAN (Camden) [10.15 a.m.]: I support the Valuation of Land Amendment Bill, which makes a number of changes to the Valuation of Land Act 1916 that will provide greater clarity and improve the operation of the Act. I would like to focus on some of the amendments that will lead to more accurate and timely valuations. Sometimes, after a parcel of land has been valued, a change may occur that affects the value of the land. For example, the zoning may change or the land might suffer some physical damage such as landslip.
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