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With an additional 17,500 jobs lost in NSW last month and pressure on businesses intensifying, Nathan Rees has unveiled a plan to make life even more difficult for small businesses and the commercial sector by increasing land tax by 25%, Shadow Minister Mike Baird said today.
“It is hard to imagine a more ill conceived plan unless we look back to the introduction of the vendor tax back in 2004, which caused a slump in the NSW property market that hurt every family in NSW,” Mr Baird said.
“Indeed Morris Iemma on becoming Premier said he was abolishing vendor tax as it was a ‘brake on economic activity’*.
“With this background it is hard to fathom why Eric Roozendaal and Nathan Rees have had their own tilt at a vendor tax by increasing land tax at a time of oncoming recession.”
Reports today reveal the Rees Government plans to increase the land tax from 1.6% to 2% for property valued at more than $1.8 million.
“This land tax increase will slam the commercial sector, where it is not unusual for a standard CBD shop to be valued in the millions – and of course these costs will be passed on to consumers.
“We need to be providing stimulus to the property industry at time of falling prices and transactions, not the opposite. Hiking taxes will undoubtedly have a knock-on effect across the entire property market.
“The problem in NSW is not a revenue one, it is an expense one. Over the past 13 years the Labor Government has run expenses well over revenue growth with the net impact identified in the Stokes Vertigan report as close to $500 million a year.
“If revenue growth had just matched expense growth the Rees Government could be delivering a surplus budget of $6 billion this year.
“Small businesses that occupy some of the commercial property that will be taxed will be hit by rent increases – no ifs not buts.
“Eric Roozendaal needs to get his runaway expenses under control and not slam small businesses as they struggle to survive the oncoming economic downturn,” Mr Baird said.
MEDIA: Lisa Harrington - 0406 726 880
* ‘Iemma to abolish vendor tax’ Sydney Morning Herald, 2 August 2005
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