The state’s advocacy organization for low-income housing consumers welcomed yesterday’s state Budget.
‘The Budget presents moderate solutions to exit strategies from the recession, and restores the Budget to surplus’, said Mary Perkins, Executive Officer of Shelter NSW.
“However the Budget does not indicate that the Government has prepared for “post recession” and “post stimulus” scenarios”, she added.
She pointed to two areas where Shelter had concerns about the Government’s fiscal strategy.
One concern is the ad hoc way in which the conveyance stamp duty drag on house sales was being addressed. The various stamp duty exemptions and concessions have been introduced with an eye to economic recovery, but they leave the fundamental problem with this tax alone. Both the Review of State Taxation (Independent Pricing and Regulatory Tribunal, 2008) and the Australia’s Future Tax System Review (2009) recommended the phasing-out of transfer duty because of inefficiencies it introduced into housing markets. However, both reviews recommended the broadening of the land tax base to eventually include all land, which is a measure that needs to be implemented with the phasing-out of stamp duty.
‘We would like to see the broadening of the land tax base in tandem with a strategic phasing-out of stamp duty’, Ms Perkins said.
A second concern was the continued reliance on Commonwealth subsidies for financing housing assistance programs, particularly social and intermediate housing. Ms Perkins said she was very concerned that the Budget papers did not indicate the source of state matching subsidies to the main growth program for social and intermediate rental housing, the joint commonwealth-state National Rental Affordability Scheme. It appears that NSW matching contributions to this Scheme are to be financed by raids on Rental Bond Board interest monies rather than subsidies from the Consolidated Fund.
Ms Perkins called for a transparent and forward-looking financing strategy for the NSW government’s participation in this Scheme.
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