More consultation needed over tax changes
Property Council urges two-year review on effect of tax moves as Australia 'already miles behind on housing supply'.
A LEADING housing advocacy group says the Federal Government’s tax changes are “pointing us in the wrong direction on supply”.
The Property Council of Australia has called on the Federal Government to undertake a second round of consultation on the latest capital gains tax and negative gearing legislation.
In its submission to Treasury, the Council argues the draft legislation contains flaws that will deter investment in housing types essential to the National Cabinet target of 1.2 million new homes by 2029.
Property Council chief executive Mike Zorbas said the changes demanded additional policy insurance in the form of relief powers and a two-year review.
“Confusion in tax law is projected on to the real world: delayed projects, stalled financing and new homes that never reach the market,” Zorbas said.
“Australia is already miles behind on housing supply. If the Government gets these settings wrong, the result is less investment in supply and more pressure on buyers and renters.
“Right now, this draft legislation points us in the wrong direction on supply.
“Every housing type matters. For example, the exposure drafts do not give certainty to build-to-rent assets across their development lifecycle and fail to comprehend or support the diversity of Australia’s housing system.
“Whether it’s a master planned community, a build-to-rent apartment, retirement village or student accommodation, all should be accounted for under these reforms.”
Zorbas said the government must give itself targeted powers to fix the inevitable unintended consequences quickly, not a system where every drafting mistake requires another round of legislation while projects sit on ice.
“A statutory review after two years is the bare minimum when the government is rewriting investment settings in the middle of a national housing crisis,” Zorbas said.
“Treasury should implement industry’s feedback and consult again, fix the blind spots and make sure every part of the housing continuum is backed in, not taxed out.”
