Thursday, 4 December 2025

 David LIMBRICK (South-Eastern Metropolitan) (23:30): (2216) My adjournment matter this evening is for the attention of the Treasurer. While there are many things that concern me about the economic and business environment in Victoria, I am an eternal optimist. Things are not so bad that the right policy settings cannot turn them around. My vision for Victoria is one where people are inspired to invest here, build businesses, employ people and take the kinds of risks that can lead to true innovation. I would love Victoria to be the kind of place where people around the world talk about it as a great place to invest and expand their business. I expect the Treasurer may share these wishes also.

What I want to talk about this evening is a particular tax that is making this vision harder to realise: the absentee owner surcharge, particularly as it applies to commercial and industrial property. As a libertarian, it would be no surprise to anyone that I hate taxes, but I do not hate all taxes equally. Some are worse than others, and this tax is a real shocker. While I think taxes like the vacant residential land tax are bad, I can understand the argument for them. People argue that property turns into a speculative investment for foreign capital and that unoccupied homes contribute to housing shortages. I think these arguments are wrong, but I can understand the argument being made. But when it comes to the absentee owner surcharge on commercial and industrial land, I struggle to understand what they are even trying to achieve. It seems to me that the only purpose is to create a disincentive for foreign investment. Why any government would want to chase away foreign capital is simply mystifying to me.

But it is worse than that. Several organisations that have modelled this tax suggest that it has a net negative effect on the state budget. They make a compelling argument that, similar to the federal tobacco excise tax, this tax has moved well beyond peak efficiency and has driven away so much investment that it now generates diminishing revenue despite the rate increasing. This is the worst-case scenario. We have a disincentive for foreign capital to invest in Victoria, and the tax does not even achieve its purpose of increasing revenue for the government. I do not need reports to understand this. I have met with people in the industry, and they explain with confidence that it was this tax in particular that was creating a disincentive for more investment in industrial projects. My request for the Treasurer is to work with her department to model the impact of this tax, with consideration to repealing or reducing the absentee owner surcharge on commercial and industrial property.