Hansard debates

Samantha RATNAM (Northern Metropolitan) (14:27): It is my pleasure to rise and speak to the State Taxation Acts and Other Acts Amendment Bill 2023. The bill contains a range of changes, mostly minor, but there are two parts of the bill I will focus my comments on: the changes to the vacant residential land tax and the changes to valuations for the fire services levy.

Victoria is in a housing crisis. That cannot be disputed. Rental vacancy rates are historically low, meaning not just that renters cannot find homes to rent but also that renters are at the mercy of their landlord or real estate agent when it comes to unlimited rent increases. We have heard so many stories of renters just accepting horrific rent increases that are creating real cost-of-living pressures because they know the difficulties of finding somewhere else to live. Investors are hoarding empty properties while renters struggle to find affordable homes. In a housing crisis homes should not be sitting empty.

A tax on empty homes is an important tool to ensure houses and land are being used as homes and not just hoarded for wealth generation. Indeed this gets to a key driver of the housing crisis here in Australia. Over many years both Labor and Liberal governments have prioritised housing as a wealth-generating asset rather than a human right. There is an incentive for investors to invest in housing for the capital gains rather than for the provision of homes. House prices in Australia are continuing to rise, providing gains to investors while keeping young people out of the market for good. As Alan Kohler puts it:

Australia is a junkie hooked on rising house prices, which is killing us.

A tax on empty homes can provide a disincentive to hoard property and an incentive to make use of homes for people to live in, but such taxes have to work. The current vacancy tax simply does not work, and we were not going to agree to expand something that does not work without significant changes. I want to thank the Treasurer and his office for working with us to realise a package of reforms that will ensure Victoria has an effective tax on empty homes. Going into our negotiations on this bill we had two main issues we needed addressed, because we were not going to support something that would not work to provide relief to renters: (1) increase the rate so the tax acts as an incentive to use a property for people to live in and (2) ensure the tax is enforced.

One of the most ridiculous things about the current tax is that it is essentially voluntary. Analysis from the Parliamentary Budget Office suggests around 18 per cent of those liable for the tax pay it – that is, four in five landowners liable for the tax just simply do not pay it or have an incentive to change their behaviour. This is a joke. We desperately need empty homes made available for renters, and there are a lot of them out there. The PBO estimates that under the current version of the tax 5000 investors are liable to pay, and with the expansion in the bill 10,000 empty homes would become liable under the tax.

The Greens are very pleased to have secured changes that will see an increasing tax rate if investors keep their homes vacant year after year, with a 3 per cent rate on homes left vacant for three years, and that the government will now trial an enforcement regime that will see every property covered by the existing tax assessed for its liability. This trial will ensure those 80 per cent of investors currently not paying the tax will have to pay the tax or rent their vacant home or sell their property.

The report and data from the trial will be made public. We expect the trial to result in a better ongoing enforcement regime for the expanded tax, making it effective in providing relief for renters across Victoria and – as a bonus for the Treasurer – more revenue. We will also have better data so as to make further changes if more can be done to incentivise investors to make homes available to renters. As a result of these changes the 10,000 vacant homes and land that the Parliamentary Budget Office estimates should be captured by the revised tax could become available for renters or owner-occupiers.

There remains much more to do for renters. The cost of living is hitting our whole community hard, and rent and mortgage payments are really hurting. Unlimited rent increases should be illegal. Victorian renters need rent control. While the government and opposition seem content to ignore the plight of renters if it means doing anything to upset the property industry, we will not. We will continue to fight for renters. We will also continue to fight for real solutions to the housing crisis. An effective tax on empty homes is one part of what is needed, but what we also need is an effective regulation of short stays to bring even more homes into the rental market, as well as rent control.

Victorians struggling to find an affordable place to live also need the government to stop the wholesale privatisation of public housing and commit to building more. Privatisation never works in the interests of the community. The winners are always corporations. The solutions to the housing crisis do not lie with giving property developers carte blanche. Affordable housing will only become a reality when governments are prepared to intervene and build more public housing to end unlimited rent increases and, at a federal level, get rid of the tax breaks that encourage investment in housing as a wealth-accumulation strategy. Instead, all governments should start to treat housing as a human right.

The other issue I wish to address is the amendments that will ensure the bill does not act as a disincentive for renewable energy projects in the state. The changes in the bill to the definition of ‘fixture’ could have seen renewable energy projects having to pay tens of thousands, if not hundreds of thousands, of dollars in levies and rates. The Clean Energy Council was very concerned that this could lead to fewer solar and wind farms and battery storage projects. Thankfully, the Treasurer listened to these concerns and the proposals put forward to fix it, as a solution. We are pleased that renewable energy projects will now pay a much lower rate of the fire services levy and that the government has committed to ensuring commercial battery storage will also have rate relief from the implications of the changes in the bill.

We look forward to supporting the amendments that the government will be moving in committee and to the relief these changes will bring to renters. People are crying out for solutions and for people in this place to work together on the big crises that face us. We were pleased to work constructively with the Treasurer to achieve this outcome. Let us hope that we can continue to achieve much more by working together with genuine dialogue and a commitment to outcomes.