Housing Tax Bad For Affordability: HIA

“Today the State Government announced they have come to a modified agreement with the Opposition on taxing developers for infrastructure in Melbourne’s growth areas,” HIA Victorian Executive Director Gil King said.

“What the State Government does not tell you is that this cost will be passed on to the home buyer when the land is developed, ultimately pushing up the cost of new homes,” Mr King said.

“Compared to previous versions the current form of GAIC is the lesser of two evils. It doesn’t matter how you window dress it, the fact is housing affordability remains under threat,” Mr King said.

The Government has said 50 per cent of funds collected will be for public transport infrastructure, with the remaining 50 per cent to go to other community infrastructure such as health services, libraries and sporting grounds. “With no nexus established between collection and expenditure it can only be concluded that the Government is intent on taxing housing,” Mr King said.

HIA has maintained its opposition to GAIC on the grounds that it is a new tax on housing and that funding for community and social infrastructure should be delivered through general state revenue.

“It is also disappointing that the expansion of the Urban Growth Boundary was continually tied to the passing of this tax. The expansion should only depend on the need to house our growing population,” Mr King said.

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Marc Pallisco

A former property analyst and print journalist, Marc is the publisher of realestatesource.com.au.