The ACT Greens expect the government to support their call today for land tax to be extended to vacant investment properties.
The Greens’ Caroline Le Couteur put a motion to the ACT parliament this morning that would extend land tax to all properties unless they are owner-occupied, charitable or agricultural properties. Her motion calls for the government to report back with the detail by later in the year, which could see a new land tax in place by July 2018.
Ms Le Couteur said in discussions with Labor and the Liberals she was confident her call would be supported – although both major parties wanted to make amendments.
She said the system would bring the ACT into line with the states, which all had a broad tax, with exemptions for principal places of residence.
In Canberra, rented homes already attract land tax, but vacant homes are exempt.
“It doesn’t make sense that you have to pay the government if you rent your house out, but if you leave it empty you don’t pay. I have no idea why,” she said suggesting it might have been a historical anomaly because of the number of Canberrans posted overseas and leaving their homes empty.
Under Ms Le Couteur’s proposal, such people’s homes would attract land tax, which would encourage them to rent out their homes while they were away.
“I would argue if you’re overseas for two or three years, rent your house out and pay your land tax as a landlord,” she said.
It is not known how many vacant homes in Canberra are lying idle, not on the market nor available for rent. But Ms Le Couteur said figures from Victoria suggested as many as one-quarter of apartments in some buildings had never been rented – possibly because their owners were overseas investors who had bought them with no intention of renting them.
In one inner Melbourne suburb, as much as 7 or 8 per cent of all residential property was believed to be unoccupied base on water use. Ms Le Couteur said the problem was unlikely to be anywhere near as bad in the ACT, but “even if it is only 1 or 2 per cent this will make a difference to housing affordability.”
“This is to encourage the owners of the houses that are not occupied by anybody to either put them on the rental market or think, I don’t want to keep on owning this asset,” she said.
She acknowledged there were complications, such as when properties were vacant for renovations, in deceased estates, where families found it difficult to finalise decisions about the family home, and in cases where people were posted overseas, perhaps short term but heir posting was extended.
Her motion calls on the government to consider the detail before coming back with a proposal.
Housing affordability was one of the biggest social and economic issues that Australia faced, she said.
“For too long the taxation system has benefited investors over home owners, contributing to housing stress for many Canberrans,” she said.
The “unfair system” would continue until the federal government abolished negative gearing and the capital gains tax discount, but in the meantime, the ACT could make its own reforms.
Housing Minister Yvette Berry said Victoria’s new vacant property tax was appropriate because it was aimed at properties vacant for six months. Any scheme in Canberra must be well informed and consider the impacts, she said.
The Liberals supported Ms Le Couteur’s call.
Source : Cnaberra Times