June 2010

WA caravan parks over the moon

Owners rejoice as government wipes out crippling land tax

Mr Marmion: financial pressure

CARAVAN parks in Western Australia are over the moon after the State's crippling land tax was wiped from their soaring running costs.

Amendments to the Land Tax Assessment Act 2002 mean caravan parks, park homes and camping grounds in the State will be exempt from the unpopular  tax from next month.

Caravan Industry Association WA chief executive officer Pat Strahan told Caravanning News her organisation was "delighted" the tax had been axed.

"Caravan parks have been struggling to survive in WA and this will assist the long-term viability of parks, which play a major part in Western Australia's tourism industry," she said. 

"In addition to the increase in land tax, there has been a major increase in electricity and water costs and these combined increases have been a factor in the closure of more than 22 parks over the past 15 years."

The huge increase in land values in Western Australia in recent years had outstripped the reduction in land tax announced by the government in 2005, Ms Strahan added.

Bill Marmion, Minister assisting the Treasurer, said the Act currently provided a 50 percent land tax concession for caravan parks, park homes and camping grounds. "From July 1, that exemption will be 100 percent," he said.

"An increase in land values across the State was putting financial pressure on caravan park operators, who were being hit with big increases in land tax bills.

"This was having an impact on the viability of caravan parks as businesses, threatening the future of low cost, affordable holiday accommodation in the State's popular tourism destinations and undermining the outlook for the many people who have chosen to live in caravan parks for budget and lifestyle reasons."

Mr Marmion said axing land tax on parks completely was removing one more reason for owners to sell to developers, displacing longer-term residents in the process.

The State Government recognised that land values had risen rapidly and the new concession would assist the long-term viability of many caravan park businesses ... "a very important part of the Western Australia’s tourism industry".

The concession will be accompanied by an increased "clawback" period for reassessment of land tax from five years to 10 years in the event of caravan park land being subdivided.

The Minister said the amendments flowed from the recommendations of a 2009 Legislative Assembly Economics and Industry Standing Committee report on WA's caravan parks and camping grounds.

"The standing committee found that rising land values had effectively negated the value of the 50 percent land tax concession to caravan park operators," Mr Marmion said.

"The committee recommended the land tax concession for caravan parks that provide predominantly tourist caravan and camp sites be increased to 100 percent and the clawback period that applies if caravan park land is subdivided be increased to 10 years."

Mr Marmion estimated the change would cost the state $1 million a year.