14 Jun 2022Property Council of Australia
The Property Council of Australia is disappointed the NSW Government will double the surcharge on foreign investors’ land tax for residential real estate from 2 per cent to 4 per cent in the upcoming State Budget.
NSW Executive Director Luke Achterstraat said the measure was simply a tax on housing investment.
“International investment plays a critical role in getting many new housing projects off the ground in New South Wales. The surcharge is a tax on new development and a handbrake on new homes,” Mr Achterstraat said.
“This is clearly at odds with the Government’s stated goal of delivering 200,000 new dwellings over four years.
“The doubling of the surcharge also sends mixed messages to the international community and whether their investment dollar is truly welcome in New South Wales
“The housing supply crisis in NSW will only get worse until we have an efficient planning system and a tax policy that promotes new housing stock.”
“NSW is 100,000 homes behind target meaning the crisis has reached red-alert levels – new taxes on the housing capital required to kickstart new builds is even more dangerous in this context.
Mr Achterstraat said most housing projects in the state rely on the small but critical role played by global capital.
“Overseas interest provides momentum for local housing projects to get off the ground, both reducing risk and enabling viability to secure a stronger pipeline of Australian housing supply to the market,” he said.
“Pre-committed investment must be encouraged to bring more homes online.
“The real cost associated with doubling the land tax surcharge will be the longer lingering cost to first home buyers facing diminished supply in coming years.
“The doubled surcharge will dampen investment signals into housing and investors will query the extent to which their investment dollar is welcome in NSW.
“International capital attraction will be an important part of meeting the economic recovery challenges faced in coming years and supporting housing supply and choice for the people of New South Wales.”
