Page 1503 - Week 05 - Wednesday, 10 April 2013
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cannot raise the funds or that this minister’s lease variation tax has changed the economics of the situation. And that is what is happening.
Projects that were formerly viable are now no longer viable because of this tax. And we know that because we have got the report from Allen Consulting that tells us so. Allen Consulting say in their report that it is doing irreparable damage to the economy and it needs to be changed. They say it needs to be modified:
The territory’s controversial lease variation charge needs to be modified before it causes irreversible damage to housing affordability, development and the economy, a new report says.
This is what this minister is doing to housing affordability, to development and to the economy of the ACT. And the numbers, coughed up like they were some sort of revelation of success and that validate the failure of this tax, have just been tabled by the minister. Let me read it again:
… as of 4 April 2013, there were 82 applications in the system, totalling $15.411 million that has been determined but not paid …
If you have done the work and you have got a DA and it is worth doing, it is viable, and you actually make a return out of it, a return that most businesses reinvest in their next development—this notion that there are all these greedy property developers out there who are pillaging the landscape and the countryside and it is all turning up in bundles of $50 and $100 bills that they stuff under their mattresses—they put it back into the economy and employ subbies, apprentices, architects, designers, suppliers, accountants and lawyers, and they contribute to the economy.
You got greedy, and you got it wrong. The evidence is there before all of us now that in three-quarters of this financial year, instead of raising $23 million, reduced to $19 million, we have $7 million. And the minister wants us to believe that magically $12 million, or five times the monthly rate, will turn up in the next three months. We will see. We will see when we get the budget and then we will see when we get the statement for the quarter, because it will not be there. It has affected the market. You said it, Treasurer, every tax has an effect. Every tax has a drag. And your tax is dragging down the market at a time when it does not need it. And your tax, in contradiction to your government’s stated policy of 50 per cent of new development being urban infill, is a tax on that infill.
That is the disconnect with this cabinet. You have got three ministers who are vying for supremacy, and none of them can get it right for the people of the ACT. And they are all addicted to tax. Instead of finding the appropriate savings or not spending, using restraint, he says, “It’s okay, we’ve set up a fund and we’ll fund it through a tax that doesn’t deliver.” And that is the problem. He has created another hole for his budget. It will hurt the deficit, it will cause an increase in the deficit. At the end of the day, it hurts taxpayers.
I thank the minister for the information. I thank him for the explanation that the lease variation tax is now hypothecated to the urban improvement fund. It will be an empty fund for a long time to come. It will be well and truly underfunded. I thank him for his
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