The confidence levels of Queensland's property industry have fallen over the last quarter, following the State Government's announcement of land tax increases and a new foreign land tax surcharge.
The latest ANZ/Property Council industry sentiment survey, the first one taken since the State Budget, has recorded a drop of eight index points for Queensland. Queensland now has one of the lowest confidence levels of all Australian jurisdictions.
Property Council Queensland Executive Director, Chris Mountford, said that the results confirm industry concern about the Government's proposed property tax hikes.
"Respondents were very critical of the performance of the Queensland Government with property taxes and charges at the top of the list of issues needing to be addressed," Mr Mountford said.
"These tax increases in this year's budget will effectively double the tax liability for many Queensland investors,"
"At a time when we need to do more to catch up with other markets, increasing taxes on property is a big economic risk - and one that is clearly impacting on local confidence."
The Queensland Budget, delivered in June, contained an increase in the general rate of land tax by 25c for each dollar above $5 million. For foreign companies and trusts, an additional 2% 'land tax surcharge' was also introduced.
The Property Council is working with the Office of State Revenue in the development of exemption guidelines to the new foreign land tax surcharge, but have expressed concern with that the new surcharge will be a significantly larger tax than comparable surcharges currently in place in NSW and Victoria.
"Foreign investment underpins so much of the Queensland property market, and any disincentive to this investment is going to cost local jobs," Mr Mountford said.
"The impact of these proposed tax increases can already be seen in the figures. Queensland's state economic growth predictions are well down."
"Taxes on business and investment are ultimately taxes that will be borne by Queenslanders,"
The Queensland Government was rated in the survey as the lowest performing state government across the country.
To view select ANZ/Property Council Survey historical data series in the Property Council's Data Room, click here.
