Mercury (Hobart) - Property

RED TAPE SHAKE-UP

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SOPHIE FOSTER

HOMEBUYERS are set to be the winners of the biggest shake-up of property taxes and red tape impacting affordabil­ity, with a federal inquiry launched to zero in on all arms of government doing the worst damage.

All levels of government and all property taxes and red tape will go under the spotlight to see how they impact affordabil­ity and supply, according to a statement by the Federal House of Representa­tives Standing Committee on Tax and Revenue chair Jason Falinski.

He called the inquiry into housing affordabil­ity and supply in Australia “an urgent moral call for action by government­s of all levels to restore the Australian dream for this generation and the ones that follow”.

A call for electronic submission­s has opened asking individual­s and organisati­ons to have their say by Monday, September 13.

The Real Estate Institute of Australia welcomed the inquiry with REIA president Adrian Kelly saying it will address property taxation in the form of stamp or transfer duties and land tax which are “among the largest barriers to housing affordabil­ity and consistent­ly performing markets”.

Mr Kelly said families across all the states and territorie­s, except the ACT, pay more in stamp duty today than 20 years ago and that is time to get serious about stamp duty reform.

“Politician­s cannot on one hand gripe about housing affordabil­ity; and then on the other say we need this income from home buyers and owners to fund public sector operations,” he said.

“REIA has called on the Council of Federal Financial Relations to take on board this issue seriously and nationally rather than just shift this responsibi­lity off to States and Territorie­s,” he said.

Mr Kelly said the massive market entry from first-home buyers in both 2009 and 2020 show the power of waiving taxes and stimulus programs in boosting house ownership.

“The lack of national co-ordination has led to limited supply of both new and existing listings across the board

“Now more than ever we need fact based and bipartisan support on policy issues for home buyers and homeowners,” he added.

Among its tasks, the committee will investigat­e the impact of tax and regulatory regimes on price, affordabil­ity, and supply of housing in Australia today as well as into the future.

“As data provided by the Reserve Bank of Australia (RBA), the Treasury and the Australian Bureau of Statistics (ABS) shows, home ownership, one of the building blocks of Australian society, has been falling for the last 30 years,” Mr Falinski said.

He said arguments about the impact of increased subsidies and tax concession­s on housing had been ongoing for some time.

“There is ample evidence that points to the small effect such measures have on supply, indeed the research points to limitation­s on land and restrictiv­e planning laws as the major causes of shortages in supply.”

He said “regulatory settings are directly responsibl­e for the unresponsi­ve nature of housing supply in Australia”.

Mr Falinski said Australia had the fourth-fastest house price growth out of the world’s advanced economies over the past 20 years.

“The Organisati­on for Economic Cooperatio­n and Developmen­t (OECD) conducted an analysis of Australia’s housing market, particular its very high ratio of housing prices to household incomes. The OECD concluded that Australia’s unusually high level of inelastici­ty in housing is the major driver of this ratio.”

He said ABS figures showed total residentia­l private building approvals decreased 44 per cent across Australia from 2016 to 2020 compared to the previous five-year period while market supply had collapsed with CoreLogic new home listings down to record lows using the most recent five-year average.

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 ??  ?? Property tax will be put under the spotlight.
Property tax will be put under the spotlight.

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