Greens' 80% windfall tax will sink market for land

THE GREENS have done it again. Even with the property industry on the floor, the party threw an additional spanner in the works with its 11th hour change in the Nama legislation to allow for an 80 per cent windfall tax on any land where zoning has been changed.

The party’s initial plan was to have the tax on lands zoned from agriculture to any development and, given that the present CGT is only 20 per cent, the idea would have had considerable support.

However, when push came to shove, it put in a further amendment to have an open-ended tax affecting all changes in zoning. This means that landowners seeking a change in zoning will automatically have to pay the 80 per cent tax, should they be successful, and then selling. Property valuers are now warning that the already depressed land market will simply come to a halt if the tax is implemented.

It’s a further blow to property developers who have assembled land banks in the hope of having most of the acreage rezoned for housing eventually. This will now be a costly exercise.

With development virtually at a halt, little additional land is likely to come on the market, except that which is to be processed through Nama. There’s likely to be a hullaballoo from developers about the tax and it’s one that might quietly get dropped before it makes the statute book.