Legislative Assembly for the ACT: 2017 Week 12 Hansard (Wednesday, 25 October 2017) . . Page.. 4297 ..
Taxation—rates on units
MR COE (Yerrabi—Leader of the Opposition) (11.14): I move:
That this Assembly does not support the Government’s recent changes to the methodology for calculating general rates paid by units.
My motion today calls on the government to reverse the unfair changes to the methodology for calculating general rates on units. This revenue-raising tactic has had an overwhelmingly negative impact on unit owners and has placed many in financial distress. Instead of alleviating cost-of-living pressures, this Labor-Greens government seems determined to raise the cost of living to new heights.
The government has been heavy handed in its management of rates and land taxes. Many properties have been hit with rates and land tax increases in excess of 50 per cent. It is irresponsible for the government to promote this as a positive policy outcome, to somehow say it is fair to slug people more. The justifications for these changes do not stack up and the Labor government will not own up and fix the problem that they have created. It has been put forward by both Labor and the Greens that the reason for these changes is that the owners are not paying a fully proportional share of rates and revenue. What we have not been told is the equivalent figures for other dwelling types. What are the equivalent figures for small houses or for three-bedroom houses or four-bedroom houses or for large houses?
A significant proportion of rates is already raised through a fixed charge. With levies, this can total $1,089. If a fully proportional share of rate revenue is a policy aim of this government, why not do away with the valuation-based charge and only have a fixed charge per residence? That would be the way to do it if you actually want to have a standard fee across Canberra. We of course are not advocating that, but it seems that the government are being somewhat inconsistent in their arguments.
The Treasurer has attempted to deflect criticism by claiming that more than 46,000 units in the ACT will remain in the lowest marginal rating category; that is, below $150,000. This has been refuted by a number of industry advocates. Only a handful of small dual occupancies and apartments would be exclusively in that category. Once the AUV for each entire strata property exceeds that $150,000 threshold, all units share in paying higher AUV marginal rates.
This year we are seeing massive increases on the back of the government’s changes. Some are seeing the valuation-based charge increase to 0.6 per cent from 0.296 per cent. This is sending the rates for a particular property through the roof. The higher rate now applies to all the 280 units in one particular complex, meaning that the government is gaining tens of thousands of dollars more revenue in this year alone from one particular building.
The changes also appear to be in contravention of recommendations the government agreed to in the ACT taxation review which was chaired by former Labor Treasurer Ted Quinlan. Recommendation 4 of the review was that, to the extent possible, the