Tuesday 23 May 2023
MEDIA RELEASE
Stamp duty reforms a step forward for Victoria – but debt levy pain ahead
The Property Council strongly supports the intention of the commercial stamp duty reforms unveiled by the Victorian Government in today’s budget.
“The phased elimination of stamp duty fees for commercial and industrial property transactions is a fantastic initiative that, if implemented well, will greatly encourage economic activity and investment in Victoria,” said Cath Evans, Victorian Executive Director of the Property Council.
“Stamp duty is an inherently destructive tax that discourages positive economic outcomes for the state. The Property Council has consistently called for its elimination from all transactions in Victoria, including residential properties – what the Government has outlined today is an encouraging first step towards broader tax reform.”
Ms Evans said that while the imperative for the Government to address debt and spending was vital, the COVID Debt Levy unveiled today is going to be a weight around the neck of the Victorian economy until it ends in 2033.
“Most of the state’s rental stock is owned by mum and dad investors that lease their investment properties to Victorian renters. An investor with a property with a land value component of just $100,000 will see a $975 land tax bill in their inbox from next year onwards,” Ms Evans said.
“The temporary land tax hikes risk having the side effect of reducing rental supply in the market, leading to upwards pressure on rents at a time when affordability is critical.
“Meanwhile the retail and commercial property owners who offered large rent deferrals and waivers to small business tenants in order to get them through the pandemic have been hit with higher tax bills to support the state’s debt recovery plan.”
Ms Evans said the industry was encouraged to see allocated funding of $23 million set aside for progressing a planning reform agenda and supporting local councils to deliver better housing outcomes.
“We look forward to further productive dialogue with the Government to shape the stamp duty package and support an ambitious planning reform agenda later this year,” said Ms Evans.
ENDS
Media contact: Dominic Raff | 0478 819 525 | [email protected]