Qld Gov’s Budget a ‘roll of the dice’
The Queensland Government released its State Budget yesterday, with Treasurer Curtis Pitt saying that it sets out a clear economic plan for the state’s future focused on three priorities: job creating innovation; investment; and infrastructure.
For the year 2016-17 the government has a $10.7 billion capital works program, which will support 31,000 jobs and provide transport, health, education, energy and water infrastructure.
“More importantly this is part of a four-year $40 billion investment in infrastructure which includes capital expenditure, capital grants and public-private partnerships to drive jobs and growth in Queensland,” Pitt says.
In the realm of the property industry, The Property Council of Australia has reacted to the Budget by pointing out that it has reinforced just how critical the property industry is to the Queensland economy, and describing the Treasurer as “rolling the dice”.
Queensland executive director of the Property Council Chris Mountford says the Treasurer is expecting stamp duty to grow by 5.6 per cent and land tax to grow by 7.3 per cent in 2016-17.
“Clearly the Treasurer’s budget bottom line has been strengthened by activity and growth in the property sector over the past 12 months, and he is banking on it continuing,” Mountford says.
“This is the role the property industry wants to play in the Queensland economy – generating jobs, affordable housing and prosperity for Queenslanders.
“We know that over the past 18 months much of this has been driven by strong residential development activity, particularly in apartments in southeast Queensland.
“And this is the part of the market where foreign investment has played such a powerful role in providing funding certainty and the presales required to get projects out of the ground.
“This is also the part of the market which is already cooling, and will continue to do so over the next couple of years as this additional supply moderates further demand.
“It beggars belief that the government is willing to risk making it even more difficult for the apartment market by slugging it with an additional stamp duty surcharge.
“It also appears likely that many developers – including house and land developers – are likely to be slugged with this tax as the Treasurer has indicated a 50 per cent foreign-owned threshold test.
“In reality, tax is a cost like any other in the development process. It’s no different to concrete, bricks or drainage – it has to be passed on to the end consumer if the project is going to stack up and proceed.
“So, today’s budget delivers a tax that not only risks investment and jobs in the construction sector, but also risks driving up the cost of housing for Queenslanders across our cities and our suburbs.”
While Mountford concedes that the first home-owners grant increase also included in the Budget is a positive step, he believes could potentially be undone for many first homebuyers.
“They will need to dig into their pockets to pay this tax as part of the cost of building their new home.”
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