The Property Council of Australia says the NSW Government’s Budget plans to freeze the tax-free threshold for land tax and to slug foreign investors with higher taxes will put the brakes on housing delivery.
Property Council NSW Executive Director Katie Stevenson said the proposed measures would increase the tax burden on Mum and Dad investors and drive out foreign investment at a critical time for the housing market.
“Subjecting even more Mum and Dad investors to land tax will not reduce rents or provide urgently needed new housing – in fact it will do the opposite, it will act as a brake on housing affordability.
“The removal of annual land tax indexation will broaden the base of NSW land tax, increasing both the number of owners subject to NSW land tax each year and the amount they must pay.
“This is nothing more than a stealth tax that will serve only to drive investors out of the market and potentially drive significant increases to both commercial and residential rental costs,” Ms Stevenson said.
Ms Stevenson said the proposed changes to the foreign investment regime would make NSW the highest of all the surcharge rates across all States and Territories.
“This is clearly a wrong move that will do nothing to support the delivery of more supply to address the housing crisis gripping the state.
“The changes mean NSW will have the highest level of foreign investor surcharges of any other state.
“Industry is finding it hard enough to secure capital without increasing the cost of foreign investment – it makes NSW a less competitive state from a tax perspective, and it will not create the investment climate we need to deliver more homes.”
