Australian Property News

Short-term cash incentives not the solution

Posted on Thursday, August 12 2010 at 11:45 AM

Cash incentives for workers relocating is the wrong measure to address housing affordability, according to Real Estate Institute of Australia president David Airey who has spoken out against the Federal Government proposal.

“The appropriate measure is the removal of state-based property taxes, such as conveyancing duties,” said Airey of what he believes is the major barrier to labour mobility.

“The removal of state-based property taxes would achieve a better outcome without the necessity to provide financial incentives,” he said.

Replacing the state-based taxes with more efficient taxes to stimulate household consumption would increase investment and improve gross domestic product growth by two per cent, said Airey of his recommendation to the Henry Tax Review.

“I call on the incoming government to revisit the Henry Review recommendations and put in place long-term measures that address the objectives of economic growth and labour mobility,” he said.