Victorian Budget Submission
Prosper Australia welcomes the opportunity to contribute to the 2017- 2018 Victorian budget as a leading non-government economic research organisation highlighting the political-economy of land, natural resource and monopoly rents.
This submission focusses on the role of State Land Tax (SLT), which is the fairest and most efficient tax, at a time when the public is clamouring for effective housing affordability policy.
SLT acts as a counterweight to land price as the market value will reflect the tax impost, reducing land prices. In essence, the higher the land tax, the lower the capitalised land value.
SLT has the potential to become the public’s first line of defence against the commodification of the property market. Under current settings, Prosper expects lifetime mortgages in the not too distant future.
Prosper’s recommendations, when implemented, will ensure that state revenue policy reflects the highest ideals of both economic efficiency and equality of opportunity. SLT can be viewed as a thank you payment for services delivered by government.
Governments of all persuasions could be encouraged to portray the most efficient of all taxes in this manner.
1. Protect and expand State Land Tax
2. Exchange Stamp Duty for Land Tax
3. Dampen speculative demand in the housing market
4. Restore Site Value Rating as the principal base for municipal rates
5. Reform the Emergency Services Levy, Waterways Charge and Parks Charge into a ‘State Rate’
6. Capture the value of rezoning decisions
7. Retain Victorian Land Titles Office in public ownership