Planning reform to supercharge Victoria but 10th new property tax will hit homebuyers
The Property Council of Australia has today welcomed the Victorian Government’s planning system reform while expressing frustrations at the introduction of yet another property-based tax.
Property Council of Australia’s Victorian Executive Director Danni Hunter said the overhaul of Victoria’s planning system was a great outcome, improving efficiencies and addressing a lot of blockages that have been a continued hindrance to the industry.
“This is a significant reform, and we commend the Treasurer and Minister for Planning for engaging with industry and implementing the reforms the Property Council has advocated for over many years,” Ms Hunter said.
“The property industry is responsible for paying 59 per cent of Victoria’s tax revenue and these reforms are welcomed by the industry and will reduce one of the perennial challenges of development and construction in Victoria – planning delays.
“The industry is proud of its position as Victoria’s key economic driver, major employer and state builder and will take advantage these planning reforms to assist with Victoria’s economic recovery.”
Ms Hunter said that while the industry welcomed the planning reforms, they were frustrated and disappointed that the Victorian Government is intent on taxing new home buyers to cover structural flaws in the underfunding of social housing by successive governments.
“We share the desire to get more social and affordable housing in Victoria and we understand the aim of providing a more certain framework, but there’s no walking away from the fact that this will increase prices for new home buyers.
“Our members are already building and funding Victoria’s social and affordable housing. This new tax sends yet another signal to Australian and international investors that Victoria is a high taxing jurisdiction with an over reliance on Victorian homeowners to fund their announcements.
“We know there is a problem with access to affordable and social housing in Victoria, but it is not a problem that can be solved and paid for by new home buyers,” Ms Hunter said
“The proposed 1.75 per cent levy will result in a price increase on the median house being the equivalent of receiving an increase of 38.8 per cent to the rate of stamp duty. This equates to an extra $19,600 on the median price of a new house in metropolitan Melbourne and $12,110 on the median price of a new unit.
“The levy would see an extra tax bill of $9,362 on the median house price in Wyndham in Melbourne’s west, a $21,525 increase in Burwood in Melbourne’s east and $11,725 in Armstrong Creek in Geelong’s growing southern suburbs.
“The new Social and Affordable Housing Contribution is a tax by another name. This is the 10th new property-based tax this Victorian Government has introduced.
“At a time where other jurisdictions in Australia are discussing tax reform, Victoria remains the only state in Australia that is implementing tax increases.
“This is yet another wrong tax at the wrong time.”
Media contact: Eric Allilomou M: 0448 291 236 E: [email protected]