Thursday, 28 October 2021

 Ms RYAN (Euroa) (16:48): I welcome the opportunity to make a contribution today, particularly on behalf of The Nationals, on the Windfall Gains Tax and State Taxation and Other Acts Further Amendment Bill 2021 and also to speak in support of the reasoned amendment that has been moved by the member for Kew.

I have to say I am not surprised that this bill has arrived in the house late on a Thursday afternoon, on a day that could only be described as a carrying-out-the-trash day. We have had, as the member for Kew just spoke in the chamber to, amendments that will see unvaccinated jurors banned from serving until November next year. The amendments were just dumped on this house at very short notice. We have had more than 200 annual reports dumped today. We have had the government’s highly controversial pandemic legislation, and we are now debating an amendment bill that in any other context would be highly controversial and highly scrutinised because it levies an enormous tax on property and is going to drastically push up the cost of housing, particularly in rural and regional Victoria, which I know the member for Ripon has a deep interest in.

This bill will affect the supply of housing at a time when we, particularly in rural and regional communities, face a very real shortage of housing. As I said, it is going to drive up the price of housing, and it is going to lock people out, particularly first home buyers, of the housing market. It is a blatant grab for money, and the reality of why we are here, why this bill has arrived before the house, is that Labor has so catastrophically mismanaged many major projects on its watch. We have had huge cost overruns with project budgets—projects like the West Gate Tunnel, Melbourne Metro, level crossings, the Suburban Rail Loop, which has not even started but has already escalated beyond anyone’s wildest imagination, and the list goes on and on and on. We know that prior to the pandemic even starting in this state the government was desperately looking for savings because it knew that it dramatically had to rein in the state’s finances. So what we have before us now is a tax on housing affordability.

This windfall gains tax will apply to any uplift in value that exceeds $100 000 due to the rezoning of land. Landholders who receive any uplift for an increase in value between $100 000 and $500 000 are going to be hit with a bill of 62.5 per cent of that value. Uplifts in value of more than $500 000 are going to be taxed at 50 per cent. There are a number of exclusions to this—I will not go through all of them, in the interests of time—but landowners will become liable for this windfall gains tax when the land is rezoned, and they will be issued a notice of assessment by the commissioner of state revenue. The owner can choose to defer that payment for up to 30 years, but if they do, the deferred liability of course will accrue a significant amount of interest at the 10-year bond rate.

This bill has been publicly opposed by the Property Council of Australia, the Housing Industry Association, the Urban Development Institute of Australia (UDIA) and the Master Builders Association. But I think when my community really understands the impact of it they are really going to oppose it as well, because as I said, it is a tax on housing affordability. Now, the growth areas infrastructure charge (GAIC) actually has a cap—

Ms Staley: And hypothecation.

Ms RYAN: And hypothecation—and there is no cap on this tax and there is no hypothecation of it. On a per hectare basis the UDIA estimates that the windfall gains tax will be double the GAIC. I have been speaking to planners and people in the housing market around Shepparton in particular. They have a really desperate situation there. There has not been enough land there rezoned over the last 10 years, and today you cannot actually buy a parcel of land to build on next year in Shepparton. It is the same situation in Bendigo and Echuca. It takes so long to get the precinct structure planning process through that all available land has been chewed up. Many councils of course are also facing significant resource challenges, and it takes an eternity to get through those processes and through government agencies. Tatura is also facing similar problems. They have not had land supply now for a couple of years and they are not likely to have any more for three or four years.

The uncertainty around this tax means that it is going to be much harder to bring land to market in regional communities, and the truth is that existing landowners are going to want more to compensate for the huge price tag the government is extracting from them. That is either going to stall deals or it is going to make land more expensive. The end result of that is that the home owner is going to pay more. If the price of land goes up, someone has to pay for that, and it will be the home owner.

The impact of this is huge in regional Victoria, and it is coming at the worst possible time. The Herald Sun on 15 October published a table of the increases in house prices. Anecdotally across my region I have known that in the last couple of years house prices in many of my communities have doubled. But if you have a look at their table, which is just the increase in house prices in the past year, across the Shire of Mitchell house prices in the past year have increased by 10 per cent, but it has been 25.7 per cent in Seymour. Benalla has increased by about 14 per cent, Strathbogie prices—across all of Strathbogie—have increased by about 30 per cent, 45 per cent in Euroa and 30 per cent in Nagambie. If you are a young homebuyer or you are trying to get into the housing market at the moment as a young person, it is almost impossible, even in my community. But we have got this shortage now being exacerbated because so many people have finally realised how great it is in regional Victoria. They are seeking to flee the city thanks to ongoing lockdowns, and many people are looking for country properties. Now, on the one hand I welcome that—I welcome an influx of people to our communities—but it is actually really exacerbating a shortage of housing across our area, and this tax is going to make that so much worse.

The thing that I do not get about this is that the government are always talking about how wonderful they are in terms of social housing—and I must tell you that the public housing waiting lists across my area are huge and getting longer—but this is only going to force more people into vulnerability and into needing more public housing. It is going to make housing more difficult for people to come by. Some of the statistics across my area for social housing: in Seymour 472 people are on the waiting list; in Shepparton there are almost 1500 people on the waiting list; and in the Ovens-Murray region, which includes Benalla and Wangaratta, there are 792. That was in March this year. In June those figures were about the same; they had grown substantially in Shepparton and also in Benalla and Wangaratta. People are waiting for years to access public housing, and this bill is going to exacerbate that and make it so much worse.

At our state conference this year we really recognised the difficulty of land availability in regional Victoria. We actually made this a central topic of conversation at our state conference, and our leader, the member for Murray Plains, announced that if we are elected next year we will actually bring 50 000 lots to market across rural and regional Victoria, excluding the City of Geelong, because we recognise that land availability is a major barrier to growth in regional Victoria right now. This bill does nothing to assist us on that journey. It is going to make life much harder, particularly for young people looking to get a foot in the housing market. It makes it more difficult for people who are looking to relocate from Melbourne, for people who might be seeking a new life.

I think the circumstances that bring us here—the fact that the government has failed monumentally to control its waste, and its mismanagement of major projects, which mean its only solution is to go and lob a giant new tax on regional land to patch up the gaping holes in its budget—are pretty shameful. And I think it is shameful that this bill was not put on the agenda in time to be properly and thoroughly debated. We had a long list of people who wanted to speak on this bill today, but because of the way the government has managed the house, most of those people get no opportunity to do so. I do not think the government is very proud of this legislation. The fact that they have timed it late on a Thursday afternoon with very limited time to debate it says all you need to know about what they actually think about this legislation and the impact that it is going to have, particularly on regional communities.

 Ms SHEED (Shepparton) (16:58): I know there are only a few minutes left, but I am pleased to rise and speak on the Windfall Gains Tax and State Taxation and Other Acts Further Amendment Bill 2021. I would like to start by seeking to amend the member for Kew’s reasoned amendment. Accordingly, I move the following amendment to the member for Kew’s reasoned amendment:

That after ‘consultation’ the following words be inserted ‘with regional Victorians on whether they should be included with metropolitan Melbourne in the application of the windfall gains tax, and’.

The reason I do this is that regional Victoria is in a particular situation. In fact the member for Euroa has outlined in considerable detail the housing stress that exists in regional areas. I can say that there are high levels of disadvantage in regional Victoria. They are not only exhibited in relation to housing stress, they exhibit themselves in so many ways: people in regional areas earn lower incomes; people have poorer outcomes in relation to health; and they have lower standards of education. There are many areas of opportunity denied to them. It is so important that in the recovery phase regional Victoria has the opportunity to thrive, and this tax will prevent that.

The DEPUTY SPEAKER: Order! The time set down for consideration of items on the government business program has arrived, and I am required to interrupt business. The minister has moved that the bill be now read a second time. The member for Kew has moved a reasoned amendment to this motion. The member for Shepparton has moved an amendment to the reasoned amendment moved by the member for Kew.

House divided on Ms Sheed’s amendment:

The SPEAKER: The question now is:

That the words proposed to be omitted stand part of the motion.

Those supporting the reasoned amendment by the member for Kew should vote no.

House divided on question:

The SPEAKER: The question is:

That this bill be now read a second time.

House divided on question:

The SPEAKER: As the required statement of intention had been made under section 85(5)(c) of the Constitution Act 1975, the third reading of the bill must be passed by an absolute majority. The question is:

That this bill be now read a third time.

House divided on motion:

The SPEAKER: The bill will now be sent to the Legislative Council and their agreement requested.