REPORTS
The power of our tax system to restructure our economy and society for the better is underestimated.
It’s time to talk about the tax shift we need for all Australians to thrive. The Prosper Australia Research Institute is focused on all aspects of land and monopoly rent taxation. Our research aims to build understanding, and provide useful evidence for public interest policy making.
Rent-Controlled Royalties: Why are we under-charging Australia's mining tenants?
By Tim Helm
Prosper Australia’s Rent-Controlled Resources: Why are we under-charging Australia’s mining tenants? report examines Australia’s resource royalties. Australian states could capture an additional $14.5 billion in revenue each year by moving to a more flexible royalty model with variable rates that adjust to market conditions. Read the report.
Melbourne’s pandemic rental dynamics: an (un)natural experiment in excess supply
By Tim Helm
Melbourne’s pandemic experience presents an ideal natural experiment for what might happen if we ‘flooded the market’ with additional housing. Unabated construction combined with the population outflow generated an excess supply of 100,000 dwellings, or enough to house 260,000 people. This report analyses the impact on housing affordability. Read the report
Stamp Duty to Land Tax: Designing the Transition
By Tim Helm
Most policy experts agree the reform makes sense, but think it’s too politically difficult to achieve. This project challenges that notion and puts forward a clear roadmap for change. For politicians searching for a circuit-breaker on state tax reform, this model offers generous but logical concessions for existing owners, choice for future buyers, and an attractive introductory period to secure support early on. It is complex at the policy design back-end but simple at the taxpayer front-end. Read the report.
The Speculative Vacancies Report
The Speculative Vacancies report was born in 2007 when as a cyclist Karl Fitzgerald noticed a disparity between media headlines decrying a ‘record low land supply’ and the dozens of vacant homes he passed on his daily commute. Since then Prosper Australia has investigated the role of vacant land and housing on housing affordability in Melbourne. Water usage data provided by Melbourne’s water authorities is measured as a proxy for vacancy. Speculative Vacancies are determined when sites are found to have abnormally low water consumption over a full twelve month period.
- Speculative Vacancies 10: A Persistent Puzzle (Karl Fitzgerald)
- Speculative Vacancies 9: Impeding the Market (Karl Fitzgerald)
- Speculative Vacancies 8: The Empty Properties Ignored by Statistics (Catherine Cashmore)
- Speculative Vacancies 7: Empty Investment Homes Ignored (Catherine Cashmore)
- Speculative Vacancies 6: Speculative Vacancies in Melbourne 2013 (Phil Soos & Paul Egan)
- Read past reports (2007 – 2012)
Speculative Vacancies Report 11
By Tim Helm
Prosper Australia’s 11th Speculative Vacancy report examines the extent of unoccupied housing in Melbourne and what it reveals about land and housing markets. The report counts empty and under-used dwellings for the years 2019 to 2023 based on average water usage over the calendar year. It shows how vacancy rates surged during the pandemic and have remained elevated above pre-pandemic levels, even amid the rental crisis of 2023. Read the report.
Planning deregulation, Housing Supply and Affordability: What if land markets are monopolies?
By Jesse Hermans & Emily Sims
We contend that there are different conceptual models of land rent deployed within the debate over planning deregulation, housing supply and housing affordability. Where the conceptual model is incomplete, it conflates the impacts of rezoning with the impacts of dwelling completion, and obscures the behaviour and incentives of the market when it comes to actual building. This discussion paper is intended to clarify and communicate Prosper’s current thinking. Read the discussion paper
The First Interval – Evaluating ACT’s Land Value Tax Transition
By Cameron Murray
In 2012 the Australian Capital Territory began a multi-decade task of major land tax reform to exchange taxes on transactions for taxes on the economic rents that accrue to landholders. This report evaluates the economic effects of these changes at the first interval, 2016, to tease out potential lessons from this rare policy experiment. Read the report
Trickle Up Economics: Assessing the impact of privatized land rent on economic growth
By Gavin Putland
This report investigates the relationship of the land rent share of GDP with economic growth. Since the Second World War, there has been a negative correlation between Australia’s total land price and the rate of economic growth. The public narrative focuses on wages losing out to the income flows to capital. Our analysis demonstrates how rapidly rising land prices and a poorly targeted tax system have ‘squeezed’ both labour and capital. Read the report.
Buying better income taxes with land taxes
By Tim Helm
Everyone wants people off welfare and into a job. But how does our tax system help? This report explores effective marginal tax rates (EMTRs) and how they act as a disincentive to workers starting or increasing work. We calculate reductions in EMTRs in exchange for increasing land taxes to standardised levels. Providing incentives for states to tax land and rezoning windfalls is an attractive way for the Commonwealth to drive tax reform where it’s most valuable. Read the report
The Rezoning Honeypot: Evidence from Fishermans Bend
By Emily Sims & Jesse Hermans
Planning decisions that alter the nature or extent of property rights on land can generate large windfall gains on the value of that land. Rezoning windfalls have been described as a ‘honeypot’ for rent-seeking. The circumstances surrounding the rezoning of Fishermans Bend, a 240-hectare brownfields precinct adjacent to the Melbourne CBD, provides for a simple quasi-experiment to quantify rezoning uplifts. Read the report
The Second Interval – Evaluating the ACT’s 20 Year Land Value Taxation transition after 8 years
By Warwick Smith & Jesse Hermans
This is the second of a series of five reports, to be published every four years, examining the progress and impacts of the ACT Government twenty year tax reform program, abolishing stamp duties and insurance taxes and replacing the revenue by increasing general rates for all landowners. This report focuses on assessing the impact of the reforms against their rationales as well as examining the impact on prices and rents. Overall, the reforms are proceeding as planned and are achieving their stated objectives. Read the report
Staged Releases: Peering Behind the Land Supply Curtain
By Karl Fitzgerald
In this report we ask whether the private choices of property owners to supply new housing according to market conditions works against the stated public policy outcome of supply-driven affordability through rezoning. We investigate the rate of lot sales in nine major master-planned housing developments in three states. We find after an average 9.5 years of production time, these Master Planned Communities (MPCs) still held 76.2% of their land bank vacant across all forms of permitted housing. Read the report
The Transit Transformation Australia Needs: Beneficiary funding as a natural and necessary evolution in mass transit planning, policy and delivery
By Chris Hale
Australia’s East Coast is facing a massive backlog of public transport investment as a result of short-termism and hazy project appraisal processes. The good news is these projects should—at least in part—pay for themselves. And we can build it in a 10-15 year period, rather than 30 plus years. This can be achieved by making the shift to a value creation based funding model. Read the discussion paper
The Unspoken Alternatives to Expensive Housing
By Cameron Murray
Most housing subsidies end up increasing landlord and developer profits rather than reducing housing costs for residents. Public land rent schemes that provide discounted land access to owners, and private Community Land Trusts, are proven ways to ensure that subsidies reduce costs for homeowners.
Total Resource Rents of Australia – Harnessing the Power of Monopoly
By Karl Fitzgerald
The Total Resource Rents of Australia report finds monopoly rents are capable of replacing taxation at all levels of government. In 2011-12, local, state and federal governments required $390.067 billion in operating revenue. The most efficient form of government revenue-raising, the taxation of economic rents, can raise 87% ($340.719 billion) of revenue needed. A fairer, more equitable tax base is possible by switching taxes off the productive sector and onto monopoly rents. Read the report.
Past reports and archives:
- Written Off (by Phillip Soos) Negative gearing is a popular investment strategy as it allows a net loss to be deducted against an investor’s personal tax liability at their marginal tax rate. Read the report.
- From the Sub-Prime to the Terrigenous (by Gavin Putland) A definitive investigation of the role of land prices in the Global Financial Crisis. Read the report
- Unlocking the Riches of Oz – How capturing economic rents makes economic sense (by Bryan Kavanagh) This landmark report uses Australia’s uniquely available land data. Read the report.
- The Taxable Capacity of Australian Resources (by Terry Dwyer) This article published in Tax Forum, 2003, systematically spells out why a rent-based taxation system is theoretically possible and where this system has worked. Read the report.
- The Elected Representative’s Guide to Site Revenue for Public Finance (by Lev Lafayette) A guide for councillors prepared for the 2006 Victorian local government election. Analyses the efficiency of Site Rating over CIV taxation. Read the report
- Victoria’s Municipal Rating System – AIUS Report ( by Phil Andersons) Since 1949, Prosper has collected and analysed data comparing the economic outcomes of local government ratings base. Access archive studies via Land Values Research Group. In this 1996 report, Phil Anderson anlayses how these different rates effect local employment and growth prospects. Read the report.
- Land Values Research Group. A wealth of data and analysis to investigate the viability of a tax shift from labour to resource rents. Evidence going back to 1943. Check ‘Collapsing Economies’ by Bryan Kavanagh. Go to LVRG website.
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The power of revenue policy to create a fairer and more sustainable economy is significantly underestimated, and this is what we seek to change.
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