Infrastructure taxes should be spent

Over $1 billion in infrastructure taxes is sitting in the accounts of councils across Sydney, according to new data released by the Property Council of Australia.

The figure is revealed in the Property Council’s latest audit of section 94 infrastructure levies – based on local government financial statements for 2013-14.

“Councils collect these taxes on the promise they will be spent on better local infrastructure but too many are failing to do so,” NSW Executive Director Glenn Byres said.

 

“We understand bigger councils planning large infrastructure projects will inevitably need some time to deliver them.

“But there are too many councils in Sydney and the result is they are too small to properly plan, fund and build essential infrastructure.

“The consequence is these infrastructure taxes – that are frontloaded into the cost of new homes and businesses – are not being spent efficiently.”

Mr Byres said the audit revealed:

• $1.069 billion is sitting unspent in s94 accounts across 39 councils – a record amount
• The amount unspent rose by $116 million in the past year – or 12 percent
• $374 million was collected, but $292 million spent in the past year

“We need to overhaul the way councils design, fund and execute their infrastructure programs,” Mr Byres said.

“These taxes are effectively adding to the cost of new homes and businesses and they are adding to the affordability challenge facing homebuyers.

“The State Government also needs to revisit its proposal to introduce use-it-or-lose it provisions on infrastructure taxes.”

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Media contact: Glenn Byres | M 0419 695 435 | E [email protected]