Page 5180 - Week 14 - Tuesday, 28 November 2017
Similarly, in Dickson in 2013 a developer consolidated two blocks and built 19 units on them, generating an increase in land values of $1.5 million. LVC payable was $110,000, only seven per cent of the actual value uplift.
In updating schedule 1, the codified charge, the government’s intention was to better design and better align the LVC payments for these types of developments with projects assessed under other LVC schedules. To the greatest extent possible, we want there to be consistency and clarity on how LVC charges are assessed and determined.
The instrument that Ms Lawder is attempting to disallow contains a number of transitional arrangements that were put in place to facilitate the change to the new codified charge. After listening to the feedback from the housing industry stakeholders, we allowed the previous LVC rate to apply to properties purchased between 1 July 2016 and 30 June 2017 where suitable development application paperwork can also be lodged to get projects underway.
We also put arrangements in place to assess projects which relied on block consolidations over a longer time period on a case-by-case basis. These transitional arrangements were put in place deliberately to ensure a smooth transition from the old fee structure to the new one. I am not sure how affected businesses feel about Ms Lawder’s attempt to upturn those arrangements and create huge uncertainty about their projects, but I imagine they have got some views.
We do understand that the territory’s tax policies are one of the many factors that impact housing affordability. Along with issues like zoning and planning rules, construction costs and market demand, our tax settings play some part in determining the development mix across Canberra.
The government does not agree with the view put by the property industry that LVC prevents development. The number of new developments going on all across Canberra provides a powerful counterargument to this view. But we do acknowledge that in a market as complex and significant as the housing market, it is very important to ensure that our policy settings are properly calibrated and working in the same direction as the government and community’s broader objectives.
That is why we have already committed to review the schedule 1 LVC charge within 18 months of its implementation in this year’s budget. It is also why the ACT Treasury and other government directorates are working together to better understand how all of our policies on tax, planning, development and more intersect in the context of housing affordability. That is the careful, considered work that we are doing while those opposite are spending their time working up parliamentary motions to try to channel more development profits to developers and not to the community.
They do not have a plan for housing affordability, Madam Speaker. They do not have a plan to see this city’s finite land put to its best use to give Canberrans housing options and choice. But they do have a plan to make developers richer, as reflected in the motion before us.