Our warning last year about rising property taxes grossly underestimated the now apparent Stalinist determination of the current state government to ride rough shod over 70yrs of established case law and valuation principles.
Just before midnight 11 February 2010, without warning or consultation, the Valuation of Land and Other Legislation Amendment Bill 2010 was introduced into parliament. A Frankenstein of mega proportions was conceived. The following morning the Minister said the government wished to “correct” the Courts interpretation of the law. Such contempt was unparalleled.
The thuggery, deception and arrogance of the State shocked the property industry. It understandably revolted in an unprecedented chorus of “foul play”. Eleven of Brisbane’s major valuation practices signed up to a full page advertisement opposing the draft Bill. Two previous Valuer Generals joined the fray.
The Bill was primarily designed to overturn years of legal battles and Court rulings involving the States dogged pursuit of shopping centre owners. The State had been prosecuted a unique and aggressive interpretation of the land valuation law that has stood for decades. In essence it argued that ‘intangible assets’ such as goodwill, licences, leases, approvals, etc should be added to the unimproved value of land assessed for rating and land tax calculations. The Courts repeatedly rejected this incredulous proposition.
The years of legal wars culminated in a Supreme Court of Appeal decision handed down 22 December 2009 involving the Pacific Fair Shopping Centre site. The Court reaffirmed the unimproved value in that instance should be $47.5M. The government had proposed a number of different values upto $255M.
The State was faced with refunding millions of dollars in now “illegally” collected land tax and a few Councils were also faced with refunding local authority rates. Some estimates put this around $100M, others as high as $600M.
Another problem loomed in that the 2010 annual valuations for 17 local authorities were due to be released within weeks.
Eventually the Valuation of Land and Other Legislation Amendment Bill 2010 was passed by Parliament after a marathon sitting beginning on the 9th of March after 52 amendments to the initial Bill.
The amended Act more or less includes intangible “improvements” in the assessment of “unimproved” value. It is a Frankenstein of lesser proportions with more lipstick consisting of mostly hastily cobbled compromises that do little for equitable property taxation. It’s a mess.
The Bill (now Act) quashed existing objection rights. The process is far more complicated and the ability to Appeal is severely diminished. The transparency that was a hallmark of the Act for nearly 70 years has been wiped. This is arguably the greatest transgression against people’s rights. Ordinary “mum & dad” taxpayers will now find it almost impossible to navigate through the Objection process.
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