The Shorten Opposition’s taxation policies would be a “kick in the guts” to South Australia’s housing sector, Master Builders SA has warned.
Independent economic modelling by Cadence Economics on Labor’s negative gearing and capital gains tax policies shows the construction of new housing and employment in the building industry would fall in all states and territories.
In South Australia, Labor’s pledge to limit negative gearing to investments in new housing and halve the capital gains tax (CGT) discount to 25 per cent for all properties would result in 2,700 fewer new homes being built in the first five years of the policy – enough to house about 6,000 South Australians.
The policies would also result in a loss of $743 million over five years and the loss of 2,260 jobs over the same period.
“Raising the effective tax rate on all types of investment housing will deter investors and will not increase supply, which is crucial to fixing housing affordability,” said Master Builders SA Chief Executive Ian Markos.
Mr Markos urged the Shorten Opposition to reconsider its policies, saying a persistent decline in building approvals demanded immediate reforms to protect jobs across the industry.
“The last thing South Australia’s housing sector needs right now is a cold bucket of water thrown over supply, building activity and employment,” Mr Markos said.
“Latest ABS statistics show the trend estimate for the total number of private sector houses in South Australia has decreased for ten consecutive months.
“671 homes were approved in August, the lowest number since May last year.
“These policies would be a kick in the guts for the industry and put thousands of hard working South Australians out of a job.
“What South Australia’s housing sector deserves and needs is positive reforms that will protect jobs in the industry.”
Mr Markos said Master Builders SA’s five point plan, Make Housing Great Again, would promote confidence in the housing industry and support the aspirations of young South Australians’ dream of home ownership.
“A key policy is for the Productivity Commission to review all the factors that are driving up house prices by about 40 per cent. These include inefficient land release strategies, excessive development levies, taxes and charges, and excessive planning and building requirements.
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