Page 2616 - Week 07 - Tuesday, 5 June 2012
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To encourage the construction of new homes, from 30 August, 2012 - the scheme will be targeted at new homes only. This will send a strong signal to the housing and construction industry to supply more affordable homes.
Land tax
To put downward pressure on rents and encourage investment in the kinds of housing which are in the shortest supply, I announce today a cut in the land tax paid by landlords who rent out low- and medium-priced properties.
Properties that will see the biggest reduction will be those with land valued at $300,000 – with up to $368 slashed off land tax.
Based on averages, a rental property in Chisholm will see a reduction of $307 in land tax a year – good news for renters and good news for investors.
This reform is an incentive for investors to provide properties at the lower end of the property market, and aims to boost the supply of affordable homes for rent.
It will provide a particular incentive to invest in standalone houses, increasing the availability and affordability of homes for low- and one-income families.
These changes not only move the Government’s revenues away from volatile sources but they make housing more affordable for Canberrans – whether they are buying or renting.
Today I also announce the abolition of land tax on commercial properties. This revenue source will be rolled into commercial rates, simplifying and streamlining administration for businesses and cutting the time spent on compliance.
Payroll tax
From July 1 the Government is cutting payroll tax for local businesses to help reduce their costs and to encourage businesses to expand and employ more Canberrans.
The new threshold at which businesses become liable for payroll tax will rise from $1.5 million to $1.75 million.
This will give the ACT the highest payroll tax threshold in the nation, and make us the lowest taxing jurisdiction for businesses with a payroll of up to $4.7 million.
Under the reform about 115 businesses will no longer pay any payroll tax. This will allow those businesses to employ up to 5 extra people before paying payroll tax. This will create the conditions for an extra 575 additional jobs in our private sector.
In addition about 1,865 businesses will get a tax cut as a result of the higher threshold, putting about $6.8 million back into local businesses, further boosting job growth and investment.
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