LAST time we checked, Queensland was a state within the Australian federation and subject to the Commonwealth Constitution. So why does Queensland impose a tax that is illegal under the same Constitution?
The tax we are talking about is land tax, and with rising property values, more than 194,500 properties were subject to land tax in Queensland in the last financial year, a rise of 14 per cent from the year before.
The Real Estate Institute of Queensland wants the land tax threshold lifted, but the Crisafuli-led state government says it has no plans to make any such changes.
Cairns News asked a person who has advised on Constitutional law cases to comment on the state-imposed property tax. “The Imposition by the (recently defeated) Australian Labor Party Government …. of land taxes on private property is absolutely illegal on two grounds,” he wrote in an email to Cairns News.
“The first is by reference to Section 90 of the Constitution, as excise is a definition of an internal tax. It is defined thus: An excise tax is an internal tax levied on goods or property. It is an exclusive power of the Parliament of the Commonwealth and the Parliament of Queensland cannot levy such a tax.
“The second grounds for making a State Land Tax illegal is the fact that in the Land Title Act 1994 (Q) the Section 188 B and 188C refer to the word court (lower case) not Court (upper case) in three places and the Supreme Court Act 1995 defines court as a place where the Judicature of Ch III Constitution judicial power of the Commonwealth is exercised.
“It cannot and must not be a Star Chamber Court comprised of a single Judge or Magistrate and applies to land held in fee simple, disposed of by the State by bargain and sale. When that happens, the root or radical title to all freehold land has reverted to the Commonwealth Crown, and all Freehold land is granted by the one True Sovereign, King Charles III, (as referenced in) S16 Acts Interpretation Act 1901 (C’wealth).
“Hence it cannot be dealt with by a Judge in Court but only judges in court to comply with S 79 Constitution. In other words by a jury trial. It is a species of fraud, to sell land and then afterwards tax it, when it is in fact reverted to Property of the Commonwealth.
“Queensland has as of-right jury trial in all property matters. S 15A Acts Interpretation Act 1901 make this levy void ab initio. The legal fiction of State Sovereign power must be rebutted and denied them.”
Constitution Sect 90 is headed: “Exclusive power over customs, excise, and bounties. On the imposition of uniform duties of customs the power of the Parliament to impose duties of customs and of excise, and to grant bounties on the production or export of goods, shall become exclusive.”
Sect 114 is headed: “States may not raise forces. Taxation of property of Commonwealth or State. A State shall not, without the consent of the Parliament of the Commonwealth, raise or maintain any naval or military force, or impose any tax on property of any kind belonging to the Commonwealth, nor shall the Commonwealth impose any tax on property of any kind belonging to a State.”
A statement from the State Treasurer David Janetzki said the LNP government had “no plans” to change land tax settings. But the threshhold valuation of $600,000 hasn’t been changed since 2007. Since then, property prices have soared to the point now where million-dollar homes are common.
Janetzki said a key exemption from land tax was if a property was someone’s principal place of residence and he claimed the threshold of $600,000 meant those with small investment property holdings “generally only pay a minimal land tax liability”.
Janetzki noted that from January 1st this year, Victoria reduced its land tax threshold to just $50,000, meaning Queensland’s individual threshold was 12 times higher than Victoria’s. Queensland was also abolishing stamp duty for first home buyers.
Queensland Treasury told the ABC that land tax in Queensland is subject to a system of three-year averaging of the land value, “which helps smooth the impacts of increasing land values on the tax payable by landholders”.
However, we predict that Premier Crisafuli, Janetzki and others in the LNP government will show themselves to be another status quo/”Team B” operation and do little to cut the overblown size of government in Queensland, including local government.
