The Property Council of Australia (ACT) has today noted the announcement by the ACT Government that the interim GFS net operating surplus for 2006-07 has reached $117 million, well ahead of the deficit of $80.3 million originally forecast by the Government, and an almost $200 million turnaround from the original forecast.
As previously noted by the Property Council, this result has in large part been achieved as a result of the significant level of additional taxes, fees and charges announced in the 2006/07 Budget, applied mainly against the property sector.
Property Council Executive Director, Catherine Carter, said: “A turnaround of nearly $200 million in one year is extraordinary. Unfortunately we have seen a pattern developing in recent years of revenue being significantly underestimated by the ACT Government.
“The Property Council notes that general rates and land tax have increased at a rate greater than CPI, that a range of new taxes such as the Fire and Emergency Services levy have been introduced, and that stamp duty remains at a prohibitively high level. “It is clear, for example, that the introduction of the Fire and Emergency Services levy, which saw rates and taxation levy increases of up to 60 per cent for some property owners over the past year, was simply unwarranted. While most jurisdictions in Australia impose a fire or emergency services levy, unlike other states the ACT’s levy does not address risk nor cap amounts. We remain concerned that the ACT Government does not appear to have examined the model properly, and do not appear to be aware of the extent of the impost on the commercial property sector,” Ms Carter said.
“Whilst we note that overall taxation levels may be generally in line with the Australian average, the big difference in the ACT is that the burden fall greatest on property. Ms Carter said the property sector contributes approximately 52 per cent of taxation revenue through a range of taxes, fees and charges including stamp duties, land tax, rates and Change of Use Charge.
“Property seems to be a continuing easy target for taxation revenue in the ACT, and we believe that this position is ultimately unsustainable,” she said. “The Property Council calls on the ACT Government to look long and hard at the increasingly high levels of revenue it collects, in order to put the Territory on a sound and sustainable economic footing into the future,” Ms Carter said.
For further information contact:
Catherine Carter, Executive Director, 02 6248 6902 or 0412 330 079