Leave land tax proposal ‘dead in the ground’: REIQ

The Real Estate Institute of Queensland (REIQ) has called for a commitment from both sides of the Queensland government to not reintroduce the land tax proposal that “plagued” Queensland property investment.

CEO of the REIQ, Antonia Mercorella, said the multi-jurisdictional land tax regime should be “left dead in the ground”.

“This unprecedented regime proposed to hit property investors with state land tax based on the value of properties held across Australia – outside of Queensland borders where the tax is collected,” Mercorella said.

“Putting this legislation to bed was the right decision for Queensland renters, investors, and businesses but sadly, the ramifications of this looming legislation were already felt.

“Some damage was already done by the time the legislation was shelved, with widespread condemnation from current and prospective investors in Queensland.”

According to Mercorella, at the time of the proposal’s failure in 2022, there was a collapse in loans to investors across the Queensland market, with “no real increase” in first home buyer activity either.

“Similarly, we saw a number of investors divesting their Queensland-based investment properties. More recently we have seen the disastrous impacts that tinkering with the land tax regime in Victoria has had on investor activity which effectively flatlined,” she continued.

“We dodged a bullet, but we cannot risk this regime making a comeback in Queensland.

“We are calling for a commitment from the government to keep the failed land tax regime in the ground where it belongs.”

She further warned that should the Queensland government attempt to resurrect the tax after the election they “will be met with the same outrage and resistance”.

“Property investors are sick and tired of being treated like a money pit, while simultaneously being expected to prop up housing supply,” she said.

“Lumping heavy tax and unbalanced legislation on investors is not the answer to the Government’s money woes.”

Recent research by the Property Council of Australia (PCA) revealed the “true cost and impact” of the Queensland state government’s taxes on new housing supply in the state.

According to the research, government taxes, fees, and charges make up 32 per cent of the total cost of a new home and 33.3 per cent of a new apartment.

PCA Queensland executive director Jess Caire said a mortgage of $730,000 equated to $233,440 in taxes, fees, and charges.

[RELATED: Qld state taxes impact home affordability: Property Council]