The lack of clarity around a proposed foreign investor land tax surcharge could cost jobs in regional areas and create an "investor drought", Labor has warned.
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Braddon MHA Shane Broad grilled Treasurer Peter Gutwein about the tax during an estimates hearing on Tuesday and asked if agricultural and plantations businesses with foreign investors, such as Forico, Norske Skog, BRA and Hop Production, would have to pay.
"So for example, Dutch Mill owns a number of properties in Circular Head. Will they be subject to what amounts as an investor tax and what impact would this have on the restart of the Edith Creek milk factory?," Dr Broad said.
Mr Gutwein was unable to say which businesses would be impacted and the exact level of foreign ownership that would trigger the tax.
He said there was "a body of work" that would be undertaken to answer those questions.
".... We need to work through that process and arrive at what we believe is an appropriate setting for Tasmania and we'll do that in the first quarter of this financial year," Mr Gutwein said.
The state government announced the foreign investor land tax two days before the release of the 2019/20 Budget along with an increase to the rate of the Foreign Investor Duty Surcharge.
Mr Broad criticised the lack of consultation and detail about the proposed land tax and asked why the government would put a "disincentive" on foreign investment.
"This is the first that most people have actually seen that the government is considering this," he said.
Mr Gutwein said he didn't believe the tax would hinder investment, including during the time it would take to finalise its parametres.
"Other states have introduced a foreign investor land tax. At this stage I don't think there is anything that I've seen that would indicate that that has had a dampening of investor interest," Mr Gutwein said.
"But at the end of the day, we will work through this to ensure we get the settings right."