In case you missed it, in mid 2021 the state government quietly passed legislation increasing Land Tax rates to apply from 2022 assessments. It was prefaced as the first time Land Tax rates have been increased in over 10 years and posed as a very “modest” increase of 0.25% for land holdings between $1.8 – $3 million, and 0.30% for land holdings in excess of $3 million.

The taxable threshold was also increased to $300,000 (up from $250,000). Sounds reasonable on the face of it.

However, those rates actually equate to an increase of around 13% on the total tax payable.

For example a $5M property will pay an extra $9,000 in land tax for 2022 assessments versus 2021, while a $10M property will pay an additional $24,000. (Note these assumptions are on a single holding basis, increases could well be higher for multiple holdings).

When you combine the higher Land tax rates with increased municipal valuations, which are based on what is permissible (eg scalable future development) rather than actual current use, the Land Tax payable can skyrocket.

Another matter worthy of note is the Federal Government’s recent announcement around changes to superannuation tax.

Currently, earnings from superannuation in the accumulation phase are taxed at a concessional rate of up to 15%. This will continue for all superannuation accounts with balances below $3 million.

From 2025‑26, the concessional tax rate applied to future earnings for balances above $3 million will be 30%.

We understand the $3 million threshold is per person (not per fund) and that earnings for the purpose of determining the new tax is not limited to taxable income, but includes all fund earnings such as unrealised capital gains.

We recommend seeking advice from your financial planner or accountant if you are concerned these changes may potentially impact you.