New taxes will deter business

New taxes will deter businessA proposal to increase taxes on property owners and businesses through ‘value capture’ in major commercial centres will not work, according to the Property Council of Australia. The Property Council’s members own major commercial office, retail, industrial, hotel, retirement living assets and develop residential projects across Sydney. The Property Council’s NSW Executive Director Glenn Byres said the value capture proposal – floated by the Tourism and Transport Forum (TTF) – was flawed. “The idea that business close to transport infrastructure should pay additional taxes is wrong,” Mr Byres said. “Land valuations on properties in commercial centres with good access to public transport already reflect the premium of their location. “And the existing tax base captures that benefit given valuations underpin land tax and council rates – not to mention stamp duty collected from property sales in prime locations. “We should also resist the risk of dampening economic activity in key centres by adding to the tax burden. “The property industry already pays over one-third of all state taxes and generates approximately $6 billion in tax revenue for local government. “Adding a new tax that is based on an assumed uplift that hasn’t yet actually occurred undermines the integrity of the tax system. “We have suggested alternative solutions, such as growth area bonds that see government fund infrastructure through bonds and then repay them through the uplift that occurs. “But this is based on utilising the existing tax base, captures increased value as it actually occurs and is designed to encourage growth through investment in new infrastructure “This is a sensible proposal and we urge the Government to adopt it in the right circumstances.” Media contact: Glenn Byres, Executive Director New South Wales: 0419 695 435