Page 1780 - Week 05 - Wednesday, 5 May 2010
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We have got the issues around land supply which have never properly been addressed and now we are seeing an acknowledgement of that, I think, with a massive catch-up. We have issues relating to competition and the way the LDA operates, issues around infrastructure and the gap between when a subdivision is released or announced and when that comes to market.
Then, of course, there is the planning system, how responsive the planning system is. We have always acknowledged that some of the legislative changes that were made by the government, which we supported, should help that, in part, in greenfields. But it is worth reflecting on some of the other threats. I circulate an amendment now. It is an amendment that just looks at some of the other issues. I have highlighted the fact that the price index for the ACT has risen much faster than in other capital cities and, of course, the failure of government to manage land supply, which has led to ACT house prices rising faster than in other capital cities.
But my amendment also talks about this other threat, and that is the additional collection of a massive $68 million in tax over the next four years through the change of use charge and the impact that will have. We need to think for a moment. The Treasurer confirmed today both at the budget breakfast and in this place in the tables we have seen as part of the codification process that we will see massive per unit taxes right across the board.
We use the example of Braddon where the minimum tax for a unit is $37,500. That is the minimum. That is if you have got 100-plus units. We know that a lot of the unit complexes in Braddon are much smaller than that. The types of developments that we see in Braddon are often small unit developments. They might be four units, six units, 10 units, 15 units. They will be taxed much higher per unit. They will actually be taxed upwards of $40,000 and $50,000 per unit.
It defies belief that you can turn around and take what is a relatively small tax at the moment that was forecasting at $2 million and then at $5 million this year, increase it in some suburbs by something in the order of $30,000, $40,000, $50,000 plus and much more for dual occupancies. In some cases, it is something like $150,000 for dual occupancies in some areas. You cannot put in place such a massive tax—a 185 per cent increase in this tax—and say it will have no impact, that it will not impact on homebuyers. It defies belief that this would not have an impact on the people purchasing a unit and that it would not have an impact on renters.
Let us remember that there are two aspects primarily to this affordability issue. There is the issue of people trying to buy into the market and there is the issue of people in a very tight rental market paying very high rents. The two are often linked, because it makes it very difficult to save for your home when you are paying very high rent and much of your income goes to your rent.
This tax that is being ramped up by this government, this massive tax on homes, will make homes less affordable. It will make renting less affordable; it will make purchasing a unit less affordable. And it will not just be in the inner suburbs. It will be across the board. The rates vary but they are significant across the board. The ones
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