Appendix 1

This Appendix explains how the current value of Sydney’s land has been derived.

A general valuation of land within Council areas is made by the Valuer-General on a 3 year cycle. These valuations are the basis of the rates notices issued by local Councils. The Valuer-General also undertakes an annual revision of land values for land tax purposes.

The data in the first 4 columns of the accompanying table has been supplied by the Valuer-General, and represents the information held on the NSW Values database as at August 2003. These columns show the total land value of land as at the “base date” - the last date on which the Valuer-General undertook a general valuation of the relevant council area. The figures comprise total value of properties zoned as either Residential, Business or Industrial, and within the City of Sydney and North Sydney only, special business zones.

The data has then been adjusted by the author to derive updated values across Sydney as at 1st July 2002 and 1st July 2003. The adjustment process is based on the procedure set out in the Land Tax Management Act, relevant sections of which are extracted in Appendix 2. These sections effectively require the Valuer-General to determine each September the percentage by which average land values in New South Wales have changed during the preceding year. This percentage is used to increase the threshold under the existing land tax system.

This adjustment process necessarily assumes that land in Sydney has increased at the same rate as land in New South Wales as a whole. While such an assumption may not be justifiable for individual properties, it is reasonable to assume that over a short period of time the trend in property values within the most valuable region in New South Wales - Sydney - would be comparable to the trend within the State as a whole.

Some support for this view can be gained through a comparison of the percentage increases in Sydney, referred to in footnote (5), and the Valuer-General’s determination of state-wide increases shown in the final column of the table in Appendix 2. For the years 2000, 2001 and 2002 the rate of increase was similar. The data in footnote (5) however is based on the Valuer-General’s judgment of what is a typical property in the category being valued.

The updated figures resulting from the adjustment process are unlikely to be completely accurate. Nevertheless, they are the best estimate of current land values which can be made on the available data, and produce a reasonably accurate estimate of the tax yield from the Sydney Transport Levy.

1. All rights, title and interests in the data in the first 4 columns belongs to Land & Property Information NSW.
2. LPI has given the author permission to publish the data as part of any article on tax policy. Others may access the data for a similar purpose.
3. The data supplied by LPI has been extracted from the Valuation Roll, which is subjected to ongoing change after the date of extraction.
4. Properties with the following zonings have been included: residential, business, industrial, and specialised zonings such as City of Sydney only, County Centre, North Sydney only, Business, Mixed Residential/Commercial & Employment area.
5. Sydney L and Sydney SS are parts of Leichhardt and South Sydney Council areas now in the City of Sydney.
6. The total Sydney figure is therefore Sydney plus Sydney L plus Sydney SS.