Disclaimer: These comments are the writer’s own and do not necessarily reflect the current opinions and policies of the Real Estate Institute of Western Australia.
Most of us will be relieved that after this weekend, the frenetic electioneering will be over for another four years.
Some key election platforms of both major parties have centred around the sale of public utility Western Power, extension of the Roe Highway, and – surprisingly – property taxes.
As previously asserted in this column, property related taxes have been relied upon by successive governments for too long. Being a significant part of state revenue, such taxes are an unreliable source of revenue for the state; a booming market (such as Sydney & Melbourne) brings waves of cash rolling into state coffers and a flat or falling market sees revenues failing to meet budgetary forecasts.
On Saturday, when preparing to cast your vote, it might be useful to know the policy positions of the major parties. Here they are:
The Liberals have committed to not raising property taxes if re-elected. It’s noteworthy that over the past three years, the Barnett government have raised Land Tax by 35%, a cost usually passed on to businesses via outgoing expenses attached to commercial leases.
Labor have not ruled out increases property taxes. Mark McGowan has been clear in saying, he’d rather not raise state taxes but spending promises of over $5 billion whilst pledging to lower the deficit raises the obvious question of, “where’s the money coming from?”
The Liberals have pledged to offer seniors an up-to $15,000 rebate on Transfer (Stamp) Duty when “right-sizing” their home effectively adding to housing diversity and freeing up larger properties to family groups.
Conversely, Labor have promised a new property tax of 4% after 2019 for foreign “speculators” (haven’t seen one of them for a while!) to pay for a proposed freeze on TAFE fees.
Unfortunately, neither party has found the political fortitude to review all state taxes and seek solutions to securing a consistent, reliable income stream. Moving to eventually abolish inefficient, job suppressing taxes that all sides of politics and academia agree are a barrier to economic growth is necessary to clear the path to our future prosperity.
Property is a fundamental part of our economy and society more broadly and the incoming government must remember that when setting policies that affect all West Australians.
by Hayden Groves
REIA Deputy President