Confusion reigns following the Queensland Treasurer's announcement of a new foreign investment tax in Queensland.
Property Council Queensland Executive Director, Chris Mountford, says the move is likely to put a cloud of uncertainty over crucial local projects for many months.
"Too many questions remain unanswered about the breadth and depth of Treasurer’s proposed foreign investment tax,” Mr Mountford said.
“The uncertainty created by this announcement is having a major impact on confidence across the property industry.
"Beyond the Treasurer’s own confusion over the impact of the tax, there has been no detail provided on how this is intended to work and who will be caught up in the net.”
“We have written to the Treasurer to clearly outline the scale of the confusion and uncertainty he has created in Queensland’s biggest industry – the property industry.
"It needs to be established who exactly the Treasurer will consider a foreigner and what types of property transactions he intends to capture.”
“For example, it is unclear if property developers will be caught in the tax net. If they are, Queensland home buyers will end up paying the tax as it will be passed on in the sale price of the home they buy.
"Will there be a threshold or test to determine how Australian a person or company is? Is someone on a visa who is working in Queensland and contributing to our economy and community required to pay more?“If a company purchasing property is only partly foreign owned, how much will they have to pay?"What will the impact be for joint venture projects with foreign partners?“Will Australians living overseas and paying tax overseas be considered foreigners?”
The Property Council has warned that the Government’s dramatic policy reversal risks Queensland’s reputation as a welcoming destination for foreign investment.
“Foreign investment has been the catalyst behind many of the Queensland property industry’s recent job-creating projects and is an increasingly important component of making new developments stack up,” Mr Mountford said.
“This move will make it harder for developers to achieve presales, and will make the next generation of projects less likely to get off the ground.
“Apartment buildings can't move, but foreign capital certainly can. The Queensland Government has surrendered an excellent competitive advantage that we held over other jurisdictions.
“At the end of the day it is construction workers and tradespeople looking for their next job in the months ahead who will be the real victims of the Treasurer's broken promise.”
