Victoria’s foreign investment tax presents investment opportunities for SAVictoria’s decision to tax foreign property investors presents incredible investment opportunities for South Australia.Over the weekend, the Victorian Government announced massive increases in stamp duty and land tax for foreigners – a move which poses dire risks to housing supply and affordability in that state. Under the Victorian budget announcement, foreign investors buying real estate in Victoria would be subject to an additional three per cent tax on the property’s purchase price and a 0.5 per cent land tax on new and existing properties. “This announcement means that South Australia could capitalise on spill-over investment from foreign investors driven out of Victoria by these punitive taxes,” said SA Executive Director of the Property Council Daniel Gannon. “Victoria’s foreign investor tax will take a sledge hammer to that state’s property sector and potentially to its attractiveness as an international investment capital. “Nationally, foreign investment is underpinning Australia’s record levels of new housing construction, which is a rare success story for our national economy at the moment. “A national wave of new housing construction that benefits Australians by creating jobs and making housing more affordable has been driven by foreign investment. “Slapping a financial penalty on foreign investment will only discourage such stimulation. “South Australia is in an investment competition with the rest of the country and globally when it comes to attracting foreign investors. “During tough economic times, we need to do everything we can to attract more investment capital into Adelaide as a destination, and South Australia more broadly.” In February this year, the Governor of South Australia, Hieu Van Le AO, outlined the State Government’s vision for the current parliamentary term. One of the key pillars of this address was harnessing foreign investment in South Australia. The Governor told Parliament on 10 February 2015: “South Australia will not grasp the opportunities of the future without attracting significant foreign direct investment into South Australia.”From the beginning, South Australia was designed to make our State an attractive place to both investors and workers. We need to renew our historic commitment to investment attraction. “My Government will therefore establish a new body that is solely focused on investment attraction.”Mr Gannon said the Property Council of Australia supports the State Government’s intentions to improve South Australia’s competitiveness for international capital. “The property sector is calling on the State Government and the State Opposition to rule out adopting this sledge hammer approach of new punitive taxes on foreign investment,” he said.”Compared to other states and territories, South Australia already has some of the highest property taxes in the country.”
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