The Victoria State Government plans to impose additional taxes on homeowners, homebuyers, and investors to address debt with the state budget of 2021-22.
The· Andrews Labor Government said The budget protects the state’s revenue base with a $ 2.7 billion austerity policy and a $ 3.6 billion program to reprioritize government spending.
These measures include raising the land tax on real estate worth $ 1.8 million to $ 3 million from 1.3 to 1.55 percent. This is a 19 percent increase. Taxes on real estate worth more than $ 3 million will be raised from 2.25 percent to 2.55 percent. This is a 13 percent increase.
The new premium stamp duty rate will also be introduced for real estate transactions in excess of $ 2 million. Homebuyers will be charged $ 110,000 plus 6.5% of the value over $ 2 million.
The government expects the new stamp duty to bring an additional estimated $ 137 million, affecting less than 4 percent of transactions.
Land investors will also face a new storm tax in which the government bears up to 50 percent of land price increases due to rezoning.
“The government is a program of initiatives focused on prioritizing our efforts, ensuring that all investment is focused on providing the services that Victorians need.” Said.
The Australian Real Estate Council (PCA) has blamed the announcement and called it a “sucker punch” for the industry.
Danny Hunter, executive director of PCA Victorian, said the tax increase would “trick” Victorians from the ongoing economic recovery and increase the cost of buying and resizing new homes.
“These tax increases make Victorians the most taxable community in Australia. Victorian land and stamp duty rates are higher than any other jurisdiction.” Hunter said.. “This new tax is the ninth new tax on Victorian assets introduced under the Andrews / Pallas administration.”
Mr Hunter said the new tax would achieve this if the government intends to attract investment and drive away investment in other cities that are doing everything to create jobs.
“We will fight this in every way,” she said. “These taxes explode in the face of all new homebuyers, all Victorian homeowners, and lessors the moment they pass Congress. We’re quick to stop this. Acted on. “
The Australian Housing Institute said tax reforms would hurt Victorian homebuyers and landowners and weaken housing demand at the wrong time.
“If housing already contributes up to half of the state’s revenue each year, it’s also short-sighted to put a heavy tax burden on housing,” HIA Executive Director Fiona Neild said in a statement.pdf).
The Andrews government believes that taxes will enable fairness to the community by sharing “millions of dollars of night profit” through investment in public infrastructure.
“It’s fair for those who make a lot of money to return a reasonable percentage to the community,” said treasurer Tim Pallas. “Our tax system is fair and progressive. We ensure that everyone pays a fair share to support Victoria’s economic recovery.”
However, Neild said the tax is unfair to Victorian landowners because the state already has the highest stamp duty costs in the country, which directly affects the affordability of homes. It was.
“It’s unfair to change the goal post after buying real estate,” Neild said. “This seems to have a particular impact on Victoria, as some urban growth areas in Melbourne may be exempt.”