The Australian Parliament has received the amendments to the Land Tax Assessment Act 2022 in Western Australia that exempt caravan and residential parks from land tax.
Currently, an exemption from land tax is available for “dwelling parkland,” which is land that is or is part of a caravan or camping ground either operated pursuant to the Caravan Parks and Camping Grounds Act 1995 Western Australia or by a local government. It is used solely for dwelling park purposes, according to a report.
Based on a strict interpretation of the legislation, this exemption does not presently apply to permanent holiday accommodation options in a caravan park, such as cabins and chalets, residential parks, and lifestyle villages containing non-vehicle relocatable homes popular with long-stay tenants, such as portable granny flats.
The amendments will replace the existing caravan park exemption and aim to ensure caravan park and lifestyle village operators do not pass on the cost of land tax to those living in residential parks, who are often elderly and on lower fixed incomes.
A full exemption from land tax will be available for parks providing short-stays or holiday accommodation only if at least 75% of the park sites are caravan or campsites, as defined in the Caravan Parks and Camping Grounds Act 1995.
It also provides a full exemption for parks providing long-stay accommodation only if at least 75% of the park sites are owner-occupied home sites governed by a site-only agreement, as defined in the Residential Parks (Long-stay Tenants) Act 2006.
Parks providing a combination of both short-stay and long-stay accommodation would also receive a full exemption if at least 75% of the short-stay sites are caravan or campsites, and at least 75% of the long-stay sites are owner-occupied home sites.
A proportional exemption from land tax will be available if the 75% threshold requirement is not met in the abovementioned circumstances.
If passed, these amendments will have a retrospective effect from 1 July 2020.
This article originally appeared on Lexology.