Victorian government shelved housing tax over fear of horror campaign

The Victorian government is controversial about building social housing for fear that a “mischievous” horror campaign on affordable housing will hurt in the November state elections this November. Abolished the tax system ($ 580 million).

On February 18, the Victorian Government invested 1.75% on all new developments over three dwellings from July 2024 to raise funds to build thousands of social and affordable homes. Announced the introduction of housing tax.

Less than 30% of housing planning permits are taxed, and the government says it can earn $ 800 million annually to build about 1,700 new social and affordable homes.

However, the new tax hits homebuyers directly, despite major industry groups saying the government has reached an agreement with the real estate sector to reduce bureaucracy in exchange for levy support. Expressed concern that it might give.

After the February 28 meeting, Victoria’s Treasury Minister Tim Pallas announced that the government would no longer proceed with parliamentary taxation and adjacent planning reforms.

“They’re done, they dusted, they’re done,” he told reporters on March 1.

He said the complete change in government attitudes was due to the negative reaction of the real estate industry and the dissemination of “misinformation” as part of a mischievous horror campaign.

“They tried to misunderstand and confuse the community that this was the net cost of housing,” he said.

“It’s totally nonsense, and the government isn’t going to put up with horrific campaigns of its nature.”

The Andrews administration also said it would not reconsider reform packages and levies after the upcoming state elections, and Pallas acknowledged internal concerns of the Labor government that disinformation campaigns would damage ballot boxes.

“We are not interested in playing those games. We get in and provide social and affordable housing,” he said.

“I think the great opportunity was wasted here for the most needed people who needed the industry to step up to the plate and think beyond their own direct selfishness.”

Epoch Times Photo
An overview of Lacrosse Building in Docklands, Melbourne, Australia, June 16, 2017. (Scott Barber / Getty Images)

Meanwhile, Danny Hunter, a Victorian managing director of the Australian Real Estate Council and a national lobby group representing real estate developers and owners, is very sorry for the government’s abandonment of reforms. Said. But she also refuted her criticism that the sector returned to the word on the basis of a pre-arranged agreement.

“The real estate industry and the real estate council have always been in good faith with the government,” she said.

She said that if the levy was more reasonable at 1 percent to 1.25 percent, Peak’s body would have agreed.

The Australian Institute for Urban Development (UDIA) is an industry group that had previously pointed out that it was not informed of the proposed tax before the government announced the tax, and welcomed the government’s decision to abolish the tax. did.

On March 1, UDIA Victoria CEO Matthew Kandelaars said the organization welcomed the decision to abolish the levy, but not the plan reforms.

“It’s frustrating that the government has chosen to redeem inefficiencies within its state-sponsored planning system to help accelerate the Victorian economy from a pandemic,” Candelers said in a statement. Stated.

“The ultimatum was given to us, but it is a position we could never accept.”

Meanwhile, opposition leader Matthew Guy emphasized that the government should not impose new taxes during the COVID-19 pandemic.

“Victorian people don’t want any more taxes,” he said.

Meanwhile, Samantha Ratnam, leader of Greens, Victoria, said the government has shown that the need for developers is more important than solving the housing and homeless crisis.

Alfred buoy


Alfred Bui is a Melbourne-based Australian reporter with a focus on local and business news. He is a former small business owner and holds two master’s degrees in business and business law. Contact him at [email protected]