GST hes­i­ta­tion wel­come

Whitsunday Times - - REAL ESTATE -

THE Hous­ing In­dus­try As­so­ci­a­tion has wel­comed the Prime Min­is­ter’s hes­i­ta­tion over in­creas­ing the GST.

“The govern­ment is right to be ap­pre­hen­sive about in­creas­ing the GST on new hous­ing, which would be a big blow to one of the bright lights of our post min­ing boom econ­omy,” said HIA chief ex­ec­u­tive in­dus­try pol­icy and me­dia, Gra­ham Wolfe. “Modelling con­ducted by the hous­ing in­dus­try shows that an in­crease in the GST by an­other 5% would add around $30,000 to the price of an in­dica­tive house and land pack­age, and over $60,000 over the life of a loan in prin­ci­pal and in­ter­est re­pay­ments.

“New hous­ing is al­ready one of the most heav­ily taxed sec­tors of the Aus­tralian econ­omy, with the tax bur­den on a new house and land pack­age up to 44% of the fi­nal price.

“Adding an­other 5% on top of the price of a new home will put hous­ing out of reach of many peo­ple that are try­ing des­per­ately to get into the mar­ket, and would re­ally put the brakes on an in­dus­try that is driv­ing the econ­omy in a num­ber of states and ter­ri­to­ries.

“As an in­dus­try that is sub­ject to a dis­pro­por­tion­ately high level of tax – some of which are amongst the most eco­nom­i­cally in­ef­fi­cient forms of tax­a­tion – we wel­come a com­pre­hen­sive tax re­form de­bate. The Prime Min­is­ter has rightly ques­tioned whether rais­ing the GST to re­form tax­a­tion else­where will pro­vide net pos­i­tive ben­e­fits to the econ­omy.”

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