BRUMBY ANNOUNCES TAX CUTS AND REFORM AGENDA

BRUMBY ANNOUNCES TAX CUTS AND REFORM AGENDA

Posted on 21. Nov, 2010 in Election Media Release, Victoria

Premier John Brumby today unveiled a commonsense tax reform agenda to lead Australia and take new actions to ease the pressure on business and family budgets, address housing affordability and help keep the jobs coming to Victoria.

Mr Brumby today announced that a future Labor Government would:

  • Abolish stamp duty on newly built first homes in regional Victoria from 1 March 2011, at a cost of $115.4 million over four years;
  • Continue Australia’s most generous First Home Owner’s scheme next financial year, at a cost of $138.7 million; and
  • Establish a Taskforce to consider future new actions on tax reform, as the Commonwealth continues its Australian’s Future Tax System Review process.

 

“I am committed to continuing to do the hard work and take the tough decisions to reform taxation,” Mr Brumby said.

“I am determined to keep the jobs coming to Victoria. That’s why in this election, we have already pledged to cut Payroll Tax by more than $200 million to its lowest rate in 36 years.

“I am determined to ease the burden on Victorians. That’s why we will also raise the concession threshold on stamp duty for pensioners to $750,000, to help older Victorians who want to downsize.

“And I can announce today that a future Labor Government will remove stamp duty altogether for first home buyers of newly built homes in rural and regional Victoria.

“This $115.4 million stamp duty cut will help more Victorians buy their first home. It will help drive jobs and investment in rural towns and regional cities and it will encourage more young Victorians to move to country Victoria.

“This $115.4 million stamp duty cut will take the pressure off our suburbs, by giving young Victorians a head start in home ownership in regional and rural Victoria.

“We want to encourage more young Victorians to move to regional and rural Victoria. It’s a win-win. It’s good for jobs in regional Victoria and, importantly, it’s good for suburban Melbourne, taking some of the pressure off the housing market.

“This is commonsense action. It is affordable. It is deliverable. It is the action that a responsible Government can take without breaking the Budget.

“As well as our $115.4 million stamp duty cut, today I can announce a future Labor Government will commit $138.7 million to continue the most generous First Home Owners scheme in Australia until 30 June 2012.”

Under the Brumby Labor Government’s First Home Owners scheme:

  • First home buyers in metropolitan Melbourne are eligible for a grant of $7000;
  • First home buyers of newly built homes are eligible for a grant of $20,000; and
  • First home buyers of newly built homes in rural and regional Victoria are eligible for a grant of $26,500.

 

The stamp duty exemption and First Home Owners Bonuses are available on homes worth up to $600,000. Treasurer John Lenders said the Regional First Home Bonus had been a stunning success with more than 8000 Victorian families taking up the bonus since it was introduced.

“The Brumby Labor Government introduced the Regional First Home Bonus. At that time regional first home buyers received up to $15,000. We increased that to $22,500 in 2009 and to $26,500 in this year’s Budget,” Mr Lenders said.

Mr Lenders said Labor was determined to take further action on tax reform.

“This is the only affordable option at this time,” Mr Lenders said. “It will ease some pressure in Melbourne’s suburban housing market, it will drive economic opportunities in regional Victoria and enable our Government to continue to invest in frontline services and key infrastructure like roads, rail, hospitals and schools.”

“When our State Budget has additional capacity, our next logical step in terms of stamp duty will be indexation of rates in metropolitan Melbourne and rural and regional Victoria.

“This would involve adjusting the brackets at which different stamp duty rates apply like we did in 2008 and would deliver savings for Victorians buying homes.”

Mr Lenders said Labor had a proud record of cutting almost $6 billion in taxes to take pressure off families and to drive jobs and investment in Victoria. In the 2010 State Budget, the Brumby Labor Government delivered $461 million worth of tax cuts, tax incentives and cuts to WorkCover premiums.

Mr Lenders said a future Labor Government would establish a Victorian Henry Tax Review Taskforce, co-chaired by Mr Lenders and a notable and suitably qualified Victorian, supported by the Department of Treasury and Finance and with a membership comprising business and community stakeholders.

The Taskforce will aim to present a united Victorian position on taxation to the Commonwealth’s review of taxation.

“As Australia’s leader on tax reform we are still very keen to reform any inefficient State taxes if we can access a new, more efficient revenue source,” Mr Lenders said.

“Tax reform creates jobs and takes the pressure off families. By bringing together business and community stakeholders with Government, we can present a unified Victorian position on tax reform and lead the national debate.”

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