Chapter 4
Housing
4.1 This chapter considers the terms of reference dealing with the effects
of the GST and new tax system on public, community and private housing,
including the level of rents.
4.2 Under the proposed new tax system different housing areas are treated
quite differently. In Tax Reform: not a new tax, a new tax system
it is stated that:
The construction and sale of new homes, and repairs and renovations
to existing homes, will be subject to a GST in the normal manner.
Residential rents will be input taxed. Residential land…when
it is sold by a registered business (such as a property developer),
it is not subject to GST on its full sale price, but only on the margin
added by the business. There is no tax when land is sold by private
individuals, or on the sale of an existing family home…Supplies
of short term accommodation in hotels and similar establishments will
be taxable. Long term stays (for twenty eight days or more) will be
input taxed in line with the general treatment of residential rent.
[1]
4.3 Residential rents will be input taxed. While housing rents will be
GST-free, the inputs will be taxed at 10 per cent. This means that while
GST is not payable on rent, no input tax credits will be allowable to
landlords providing rental accommodation. [2]
4.4 Evidence to the inquiry emphasised that access to affordable, appropriate
and secure housing is essential for all Australians. [3]
Many people, especially those on low incomes, have difficulty in meeting
housing costs. Those people in dire housing need are often the most disadvantaged
groups in society, including older people, sole parent families, young
people, people with disabilities and indigenous Australians. An effective
system of housing assistance is essential to provide and to maintain a
suitable standard of housing. Currently there are 360,000 households in
public housing; 235,000 households on public housing waiting lists; and
880,000 households live in what is deemed to be `unaffordable housing'.
[4]
Modelling
4.5 In the Government's own estimates that the price increase experienced
by consumers of housing services – renters and owner occupiers –
will be 2.3 percent as a result of the GST. [5]
4.6 Evidence to the Committee indicated that the Government's modelling
is flawed, with no evidence accepting the Government's prediction
of only a 2.3 per cent increase in housing costs. National Shelter argued
that Treasury looked at the housing market as one homogeneous market –
whereas different sectors of the market operate quite differently. [6]
The NSW Federation of Housing Associations predicted increases in rents
of up to 11 per cent and some industry groups predicted rises of up to
8 per cent. [7] The Committee notes that modelling
by Chris Murphy from Econtech to the Select Committee showed that rents
would increase by 3-4 per cent. [8]
4.7 In evidence to the Committee, the NSW Federation of Housing Associations
stated that:
4.8 The Committee concluded that there has been a total lack of modelling
and research undertaken by the Department of Family and Community Services
(DFaCS) into the specific effects of the GST and other aspects of the
proposed tax reform on the housing sector. In response to questions from
the Committee on the impact of the reforms on possible rent increases,
the Department replied that it had not done any modelling of the impact
of the GST in this area. The Department indicated that they had relied
solely on Treasury modelling. [10]
Senator CHRIS EVANS – What about the flow on to the costs
of rents? Has the department done any work on that?
Dr Ogborn – We have not done any modelling of the impact
of the GST.
Senator CHRIS EVANS – So this is all again based on Treasury
modelling is it?
Dr Ogborn – Yes.
Senator CHRIS EVANS – What about the flow on to public
housing? Has there been any work done on the impact on public housing?
Dr Ogborn – Again, we have not done any work. The public
housing authorities are doing a lot of work at the moment to identify
the impacts on them.
Senator BARTLETT – That is at state level.
Dr Ogborn – Yes…..
Mr Tune – What I am saying is that the issue is broader.
It is not just a housing issue; it is a matter of Commonwealth-state
relations because housing is one of a number of issues that could be
looked at in that context. Therefore, the government is saying at this
point in time that it is a Commonwealth-state issue on the macro scale;
it is not a micro housing issue.
Senator CHRIS EVANS – So the answer to my question about
whether there is going to be any work done on the impact of public housing
is that it is a macro issue and therefore you are not doing any work
on it.
Mr Tune – We are not doing any work on it. It is for the
states to work out whether there will be any impact, if they think there
will be one. They are the ones who are running the state housing authorities.
Senator CHRIS EVANS – But if there is it is their problem.
That is what you are telling me.
Mr Tune – I think that is true.
Source: Committee Hansard, 2.2.99, pp.125-26, DFaCS.
4.9 Given the importance of housing in relation to quality of life and
general well-being to the community and the magnitude of the changes to
this sector proposed in the new tax arrangements the Committee is appalled
that the Department did not undertake any modelling to assess the impact
of the changes on its client base.
Public housing
4.10 There are 360,000 households in public housing in Australia. Tenants
in public housing pay rent based on a fixed proportion of their income,
which varies from between 20 to 25 percent of income, depending on the
State or Territory. [11]
4.11 Residential rents for public housing will be input taxed. While
housing rents will be GST-free, the inputs (the goods and services used
to build, repair or maintain a dwelling) will be taxed at 10 per cent
and no input credits will be allowed to be claimed by public housing authorities.
The housing authorities will either have to absorb the additional costs
or pass on the costs to tenants in the form of higher rents.
4.12 As part of the Government's compensation package there will be a
4 per cent increase in the maximum rate of social security pensions. [12]
DFaCS advised the Committee that `each State will make its own decision
as to the extent that income support rate increases and increases in family
assistance are taken into account when calculating rents'. [13]
Organisations representing public housing tenants argued that rents will
increase and that the rent increases will be substantial.
4.13 The Department stated that the maximum rent increase, if applied,
would `be in the order of 1% of income, whereas GST compensation for income
security recipients will be 4%'. [14] The Committee
notes that the Government has taken steps to ensure that nursing home
residents, who pay a fixed proportion of their income in accommodation
charges, are not faced with any increase in costs. This has been done
by ensuring that the 4 per cent pension increase is quarantined from the
formula that calculates the amount of rent paid by residents in nursing
homes. The Committee asks why public and community housing tenants are
not treated in the same way.
Rent increases
4.14 Concerns were expressed at the possibility of an increase in rents
as a result of the tax reform compensation measure. Several groups noted
that the 4 per cent increase in rates of social security payments designed
to provide compensation for the impact of the GST on low income people,
will lead to an automatic increase in social housing rents for all tenants
on social security payments – which is the majority of tenants –
unless State/Territory housing authorities make special provisions to
avoid this flow on. [15] Rents are set as a
fixed proportion of a tenants' income, which varies from between 20 to
25 per cent of their income. Therefore, 25 per cent of the compensation
package will automatically go towards increased rents.
4.15 The Community Housing Federation of Australia (CHFA) stated that:
Any change to their income – in other words, the compensation
package that is being introduced on 1 July 2000 – will have a
fairly direct impact on people who are community housing tenants on
the basis that they pay a percentage of their income as rent…If
their income goes up, their rent immediately goes up. So, by the benefits
that come through the GST compensation package, these people will
be adversely affected immediately through a rental increase…with
the introduction of the GST these people will not get compensation
through tax cuts, and many of them do not earn enough to pay any tax.
There will be increases in other services, such as transport, education
and food. And there are now going to be rental increases as well for
those people. [16]
4.16 The National Youth Coalition for Housing (NYCH) also submitted:
In our estimation…there are extremely important questions in
relation to compensatory measures offered to social security recipients:
the effect of price rises on those who consume more than 100 per cent
of their incomes, the effect of the tax package on rental housing
costs, the effect of the new tax system on the service capacity of
existing services to homeless people under the Supported Accommodation
Assistance Program, the effect of the new tax system on funding levels
in specific purpose payments and the future of specific purpose payments
and the Commonwealth's role in safety net programs under the new tax
system into the future. We are particularly worried about the effects
on young people's ability to afford basic living costs after the introduction
of a GST because young people are on the lowest incomes of all in
our communities. [17]
4.17 National Shelter, ACOSS, the Combined Pensioners and Superannuants
Association of NSW (CPSA) and the Australian Pensioners' and Superannuants'
Federation (APSF) argued that social housing tenants should be protected
from any increases in rents arising from the compensation measures contained
in the tax reform package. These groups argued that GST pension increases
to compensate for higher cost of living should be quarantined so that
they do not flow on into increases in public and community housing rents.
[18]
Mr Ramsay - …It is very difficult for tenants to actually
contest rent increases. We are concerned that the GST will be used by
unscrupulous landlords as a cover for increasing rents that do not necessarily
relate to their costs… One of our major points …is that rents
do not go up by 2.3 per cent; rents do not go up by $6.35. Rents go
up in $10 lots. There is an inflationary impact of the GST that I do
not think has been considered in any of the debate that I have heard
lately. Landlords just do not increase rents by $6.35. They go up in
$5 lots or there will be a $10 increase, $15 increase, $30 increase.
That is one of our concerns.
Source: Committee Hansard, 23.2.99, p.842, NATO.
4.18 While public housing providers may receive increased rents as a
result of the 4 per cent GST compensation increase in social security
payments, this is not expected to offset the increase in costs. [19]
4.19 National Shelter noted that any additional increases in rent
will further erode the compensation package, designed to fully compensate
recipients for the increased costs associated with the GST. [20]
4.20 The National Association of Tenant Organisations (NATO) noted that
the effects of the GST will add to public housing waiting lists and exacerbate
the already critical under supply of public housing in Australia. NATO
stated that given that housing funds are declining and `everything' that
public housing organisations purchase will cost more it will diminish
the ability of providers to meet increasing community needs. [21]
Public housing – is it a `commercial' service?
4.21 A number of housing organisations raised concerns about their status
as either `commercial' or `non-commercial' entities under the proposed
legislation. A non-commercial supply of services is one where the price
charged (in this case, rent) is less than 50 per cent of the normal market
value. National Shelter stated that there is still great uncertainty about
this issue. National Shelter stated that `this is something we have sought
advice from Treasury on, but we are still awaiting a response'. [22]
4.22 National Shelter argued that public housing providers were nevertheless
likely to be treated as `commercial' entities. If housing is deemed `commercial',
rents will be GST-exempt. This means that the housing supplier/owner pays
the GST on inputs (such as management fees, maintenance, office rent and
office expenses) but no tax credits can be claimed. The housing owner/supplier
cannot charge tenants GST on their rent. Thus the supplier of the goods
and services, in this case, a public housing authority, either has to
absorb the GST paid on the inputs itself, or passes the GST on to the
final consumer – that is, the tenant, by increasing rents. [23]
If public housing is defined as `non-commercial' the legislation allows
for tax credits to be claimed.
4.23 National Shelter explained that:
Public housing providers are therefore in an untenable position.
Housing is a government service that is input taxed. Because of this
situation, there is no recourse for a commercial organisation to claim
input credits on its additional expenditure. The assumption that the
cost of the GST will be passed on to the consumer, cannot apply for
public housing because rents are income based. There is no capacity
to put up rents to meet the additional cost.. [24]
4.24 Evidence to the inquiry indicated that because residential rents
are input taxed, there is no scope for public housing providers to claim
input tax credits on any GST they pay on their inputs, including any GST
on insurance costs, legal costs, administrative costs and maintenance
costs. [25] National Shelter and other groups
also argued that there is no scope to pass on these increased costs to
tenants in the way that private landlords can, because rents for public
housing tenants are a fixed proportion of income – not exceeding
25 per cent of income, which means that one out of every four dollars
goes directly in rent. [26] National Shelter
noted that this benchmark `has tacit agreement from all social housing
providers and any increase to this would be an additional burden on the
poorest Australians'. [27]
4.25 The increased costs will have to be borne by the public housing
authorities. There is no guarantee that the extra costs will be covered
by increased funding from Government.
Public housing stock
4.26 Evidence indicated that public housing providers will face increased
costs in the provision of public housing with the introduction of a GST.
There will be increased construction costs and increased costs associated
with the supply of existing rental housing, because there will be a GST
on maintenance costs and contracts and on stationery and the rental of
office premises. The NSW Federation of Housing Associations pointed out
that in 1996-97 the NSW Department of Housing spent over $113 million
on maintenance of public housing. Under the GST they would spend an additional
$11.3 million on this item alone. [28]
Shelter Tasmania stated that Housing Tasmania will face additional costs
due to the GST – `extra maintenance will be a special burden'. The
proposed tax changes `will compound the problems of maintenance and supply
of public housing'. [29] Since State Governments
are major suppliers of public housing the impacts of the GST will have
marked effects on the available budgets for housing maintenance and purchase
of capital stock.
4.27 Shelter Victoria stated that given that a GST will be levied on
the construction of new housing, as well as the costs of inputs such as
maintenance, repairs and redevelopment, State housing authorities will
face `difficulties in the light of continually declining funds from the
Commonwealth under the Commonwealth-State Housing Agreement (CSHA) to
maintain, let alone expand, its public housing stock'. [30]
4.28 National Shelter and ACOSS argued that increased costs could lead
to public housing authorities providing less housing, compromising on
housing quality and maintenance and/or increasing rents. [31]
Grants from Government to housing associations may also incur a GST. This
is because these grants may be considered to be `purchases' for the supply
of housing. This is another example of the uncertainty in the legislation
and the confusion this is causing to housing providers.
4.29 Evidence indicated that funding for the CSHA, which provides funds
for capital purposes to the States primarily for the provision of public
rental housing for low to moderate income households, has been declining
in real terms for a number of years. As a consequence there has been a
lot less money for public and community housing – `if there are any
leakages from this system via a GST, it does not go back into the state
housing authority…it goes into Treasury and then Treasury passes
it on to state treasuries'. [32] It was emphasised
in evidence that there are no assurances that that the funds will go back
into the housing area – `the GST causes a leak from housing funds
into consolidated revenues as inputs are taxed but credits cannot be claimed'.
[33]
4.30 Compliance costs associated with the new tax will be a further additional
impost on public housing authorities, who will be required to be registered
entities and to file regular returns. [34]
Organisations with an income over $100,000 per annum will be required
to become registered and therefore to become a tax collector for the Government.
Some housing bodies with complex functions will be further burdened because
they will be involved in additional reporting and tax collection.
Community housing
4.31 There are 28,779 housing units managed by community housing organisations
nationally. Community housing provides essentially the same service as
public housing but with a more locally managed focus. The majority of
community housing tenants are in receipt of income support and pay between
20 to 25 per cent of their income in rent. About 12 per cent of tenants
in the community housing sector pay market rents. [35]
Community housing organisations raised many similar concerns to the concerns
raised by groups in relation to public housing.
4.32 Under the proposed legislation rents for community housing will
be input taxed. As for public housing, this will mean that suppliers of
community housing will either have to absorb the additional costs or attempt
to pass on these costs to tenants. CHFA stated that the majority of tenants
are paying less than 50 per cent of the market rate in rent. [36]
DFaCS advised the Committee that community housing services provided on
a non-commercial basis (eg. where accommodation is provided at less than
50 per cent of the tax inclusive market value) would be GST free. [37]
4.33 Some community housing tenants, however, pay 50 per cent or more
of the market rent, depending on their location, housing type, and income.
Housing associations which operate in areas where market rents are low
may find themselves considered to be providing a commercial service and
taxed accordingly. [38] Shelter Tasmania stated
that this is a real concern in Tasmania –`if rent exceed 50% of market
rent – a real possibility in certain areas of Tasmania – they
will be classified as commercial and subject to the commercial rate of
GST. This would make many community housing organisations unviable'. [39]
Community housing– a commercial activity?
4.34 CHFA noted that an important issue for the sector is whether community
housing providers are classified as `commercial' or `non-commercial' entities
under the proposed tax changes. A non-commercial supply of services is
one where the price charged is less than 50 per cent of the normal market
value. Shelter Victoria stated that `this is particularly relevant for
community housing providers as a number of these organisations are currently
sales tax exempt due to Public Benevolent Institution (PBI) status'. [40]
4.35 CHFA stated that the intent of the legislation is very unclear in
this regard. CHFA noted that the Vos Report stated that the commercial
activities of charities will be subject to a GST to avoid unfair competition
with other businesses and that a `non commercial' supply of services is
a `supply that is for a nominal or insubstantial consideration'. `Nominal
or insubstantial consideration' is the payment of a price that is less
than 50 per cent of the normal market value of the supply. The Federation
asked `where do community housing services fit into that definition?'.
[41]
Increased Rents in Community Housing Sector
As the majority of community housing providers are not-for-profit organisations,
a potential conflict of interest may arise in terms of their ethos in
providing community housing based on social objectives and their treatment
as commercial entities under the proposed tax regime. If community housing
providers are regarded as providers of commercial services, they will
not be able to claim back the GST paid on inputs. While rents are GST
free, the additional input costs for community housing providers, as
well as transitional and compliance costs, may have to be either absorbed
within the organisation or passed on to tenants in the form of increased
rents.
Source: Submission No.675, p.13, Shelter Victoria.
4.36 CHFA argued that all community housing organisations should be defined
as `non commercial' because they are not strictly in competition with
private providers and because the people who use community housing `often
have high needs tenancies, low incomes and poor tenancy records, none
of which are usually attractive to private rental agencies. A number of
them are young people, and they are also seen as a considerable risk'.
[42]
Mr Anderson—I think quite a lot of community housing organisations
provide services to their tenants…There are a lot of community
housing organisations which will have difficulty defining what is a
non-commercial service and what is a commercial service. Who is to clarify
whether the service is being provided at a non-commercial rate or at
a commercial rate? Who sets the rate, for instance, for provision of
a support service to a tenant? Similarly, with boarding and lodging
houses you have the issue of boarding house proprietors having to sit
down and decide: is this a service that is being provided at a commercial
rate or is it a non-commercial service which is just part of the general
service of the organisation?
Source: Committee Hansard, 24.2.99, p.879, Shelter SA.
4.37 National Shelter noted that community housing may be considered
to be providing `commercial' services. If the sector is `commercial' then
National Shelter noted that `it will be treated like any other business
and will have no relief from the GST on our inputs'. [43]
Input tax credits
4.38 CHFA and National Shelter raised issues related to the input tax
arrangements. National Shelter noted that the majority of inputs for community
housing organisations are not currently taxed, for example, in the areas
of maintenance, management fees, office rent and office expenses as most
organisations are sales tax exempt because they have Public Benevolent
Institution status or are defined as charities. In addition, major expense
items for these organisations do not incur sales tax because they are
primarily services rather than goods. [44]
4.39 CHFA submitted that community housing providers are unlikely to
be able to recoup the additional costs associated with the input taxing
of rents in increased rents as community housing tenants do not pay market
rents – with rents as a fixed proportion of tenants' income. CHFA
stated that the rent increases that will result from the GST compensation
arrangements will increase the income for community housing organisations
`but not sufficiently to offset the other increases as a result of the
GST'. [45] CHFA stated that some community
housing organisations would become non viable and could close down. [46]
Threatens Viability of Community Housing Sector
The loss of this sector would affect access for a number of individuals
and families as their housing would no longer be affordable with the
increased likelihood of overcrowding and forced sharing, and homelessness.
Private rental in most cases is not an adequate substitute.
Source: Submission No.677 p.7, CHFA.
Other issues
4.40 Headleasing arrangements where private property owners lease their
properties to community housing authorities will attract a GST. This is
because leasing this form of housing will be treated as another `input'.
These leases will attract GST but the rent paid by the tenant occupying
the property will be GST exempt. Costs for community housing authorities
will therefore rise as they will have to bear the cost of the headlease.
The other problem is that there will be difficulties in leasing properties
from landlords as private landlords may not wish to become `tax-collectors'
and prefer to rent to individual renters. [47]
This will lead to a decline in the available housing stock.
4.41 CHFA noted the costs of compliance associated with the proposed
tax changes will add to the administration and training costs of community
housing organisations. [48] National Shelter
stated that compliance costs will be significant noting that `organisations
that become registered are therefore tax collectors…Some housing
associations with complex functions could find they are involved in very
complex reporting and tax collection arrangements'. [49]
Mr Myers – The increases that will happen for community
housing organisations are going to be in areas like maintenance, insurance
and management services. They are going to have to pay more for their
accountants, computers, offices and maintenance. We estimate the impact
of an increase in maintenance costs to be about half a million dollars
a year in Queensland in the community housing sector. That is a very
significant increase that has to be borne somewhere. We do not believe
that this is going to be met by those people who do qualify for rent
assistance, who are a proportion of the occupants.
Source: Committee Hansard, 5.2.99, p.388, Queensland Community Housing
Coalition.
4.42 The Aboriginal and Torres Strait Islander Commission (ATSIC) also
noted concerns in relation to Indigenous community organisations providing
housing to Aboriginal communities. ATSIC expressed concerns that the organisations
`would either have to reduce the level of housing provided or pass on
the increased costs (of building new houses and repairs and maintenance)
through to the tenants' as a result of the proposed tax changes. [50]
4.43 The problems of youth housing were also highlighted. NYCH stated
that both public and community housing offer young homeless people an
avenue out of crisis accommodation and into a stable and affordable living
environment. NYCH argued that it was important that the GST and the new
tax changes do not diminish the supply of this housing, or increase the
cost of it to low income tenants, including youth. [51]
Mr Hill – Probably the other point to make is that the
distinction between commercial and non-commercial activities is going
to be a very big issue for youth services that provide accommodation.
The whole interplay between a GST, youth incomes, changes to the Commonwealth-state
housing agreement—all those things need to be seen together, because
there are cross impacts; we cannot look at just one in an isolated way.
If you take money out of the whole system and you also look at the level
that people can contribute to the maintenance of organisations through
rent, you are looking at a situation where community organisations providing
accommodation and youth services providing services to young people
are having to deal with at one time a whole lot of complex issues that
will affect their operational capacity.
Source: Committee Hansard, 5.2.99 p.393, South East Queensland Youth
Accommodation Coalition.
Boarding houses, hostels and caravan parks
4.44 Under the proposed tax reforms, where accommodation in boarding
houses, hostels and caravan parks is supplied for 27 days or less, it
is classified as short term accommodation and is therefore subject to
a GST at the full rate of 10 per cent. If the premises are predominantly
used for short stays the proprietor is able to charge a GST rate of 10
percent for the first 27 days and a 5 per cent rate thereafter.
4.45 The Government's initial proposal was that `long term stays' (for
28 days or more) would be subject to a GST at a concessional rate of 50
per cent (that is, a GST rate of 5 per cent). The Government has now decided
that proprietors will have the option of applying either this rate or
applying the input tax rules for residential rents, that is, not charging
a GST, but not being entitled to input tax credits. [52]
4.46 Many residents of hostel, boarding house and caravan accommodation
are low income and disadvantaged people who cannot find or afford other
accommodation and many residents of hostels and boarding houses also have
a disability. [53] In NSW alone over 80,000
people live in boarding houses, caravan parks etc. Emergency refuge services
also use boarding houses and caravan parks to supply crisis accommodation.
These services will have to pay the extra 10 per cent GST.
4.47 Evidence from boarding house proprietors and housing organisations,
generally opposed the GST on boarding houses. The Boarding House Owners
and Managers Association and the Supported Accommodation Providers Association
(BHOMA/SAPA) argued that rents should be input taxed. [54]
Some evidence indicated that the additional costs associated with the
GST will more than likely be passed on by managers to tenants. In addition,
it was noted that the legislation unfairly treats the accommodation and
services provided by boarding houses differently from the accommodation
and services for other low income groups. It was also argued that residents
in these facilities are also unfairly discriminated against compared to
private renters who are input taxed. [55] Evidence
to the Committee emphasised that boarding house residents are amongst
the most marginalised in the community, generally on lower incomes and
with higher support needs than other members of the community. [56]
4.48 The BHOMA/SAPA stated that:
The supported accommodation and boarding house industry has historically
played an important role in providing accommodation and services to
low income groups…Both the supported accommodation and boarding
house industry have in recent times, struggled to maintain the economic
viability of their premises..The introduction of a GST as it currently
applies to both supported accommodation and the boarding house sectors
is likely to exacerbate this trend, with many more premises likely
to close their doors unless action is taken to change the industry's
tax status under a GST. [57]
4.49 Evidence from caravan park associations were also generally opposed
to a GST on residents' rents. [58] It was emphasised
that long term residents in caravan parks should not be treated differently
from renters in the general housing market especially as the caravan park
is their principal place of residence. Evidence suggested that residents
of caravan parks are generally on low incomes, with most in receipt of
government social security payments. It was argued that park owners will
almost certainly increase rents to cover additional costs they may incur
due to the GST. [59]
4.50 The Treasurer subsequently announced changes in respect of the tax
treatment of providers of long term accommodation in `commercial residential
premises' due to pressure from organisations about the unfairness of the
measure. The changes came about partly as a result of this Senate inquiry
and in response to continuing protests about the legislation from proprietors
and residents of boarding houses, and housing groups. The changes were
flagged in a letter from the Treasurer to Government backbenchers. The
Committee wishes to record that the Treasurer's letter has not been formally
provided to the Committee.
4.51 The Treasurer acknowledged that there were deficiencies in these
arrangements and that caravan park and relocatable home park operators
had expressed concerns that they will have to charge GST on rents from
long term residents' and that this cost is not imposed on rents payable
by tenants of other residential accommodation. The Treasurer further stated
that:
The Government has therefore decided that to allow such accommodation
providers a choice of applying the Division 87 treatment for long
term accommodation or applying the ordinary input taxation rules for
residential rents; that is, not charging GST for services (including
rent) supplied, but not being entitled to input tax credits. [60]
4.52 Under the revised arrangements, operators of boarding houses and
caravan parks and the like may either charge the concessional rate of
the GST on rents or apply the input tax rules for residential rents –
that is, not charge a GST, but not be entitled to input tax credits.
4.53 Housing groups argued strongly, however, that the revised arrangements
do not address in any way the major concerns they have in this area in
that whatever tax regime is applied costs will inevitably be passed on
to residents.
Changes to Treatment of Boarding House Residents Not Adequate
The NSW Federation of Housing Associations was highly critical of the
approach of the Treasurer on this issue:
While the choice is offered to proprietors it is not offered to residents
so the residents will find that their accommodation costs will rise
under either system. Either they will be forced to pay the five percent
GST, unlike other tenants, or they will end up having to pay higher
costs to cover the additional costs to the proprietors because the rents
are input taxed…So while I am aware of the letter I do not think
that it answers our concerns.
Source: Committee Hansard, 23.2.99, p.810, NSW Federation of Housing
Associations.
4.54 National Shelter, reflecting much of the evidence received on this
issue, also argued that:
While this is a for profit sector there is not a lot of profit to be
made…The businesses are not in a position to absorb extra costs but
equally nor are their residents…regardless of which type of taxation
system the proprietor chooses under this choice, it is still going to
end up being that there are extra costs and someone will have to wear
them. [61]
4.55 The WA Tenants Advice Service also noted that the approach `assumes
choice that is not always there for tenants'. [62]
The Tenants Service also added:
4.56 `Commercial accommodation' is also very narrowly defined in the
Bill to include the provision of gas/electricity, airconditioning and
heating, telephones and televisions. Any additional services offered at
the premises such as meals, drinks, laundry etc. are considered `incidental'
and attract the full 10 per cent GST.
4.57 Several groups, including National Shelter and ACOSS argued that
rents paid by long term residents in accommodation such as caravan parks,
hostels or boarding houses should be exempted from the GST. [64]
The Committee believes that it is unacceptable that residents in these
types of accommodation, many of whom are among the most marginalised and
disadvantaged members of the community, should face a disproportionate
increase in housing costs as a result of the introduction of a GST.
Strata and body corporate schemes
4.58 Concerns were raised by Unitcare Services that strata title schemes
and body corporates will be forced to add the GST to their levies. The
GST will be applied to the levies raised by the strata corporation/unit
group to pay maintenance, painting, insurance and administration of the
property. What this means is that strata title schemes will be forced
to levy a GST, track the GST charged on goods and services, and then have
the added administrative burden of claiming tax credits. If introduced
this would impact on approximately 1.1 million unit owners in Australia,
of whom 286,000 are aged over 65 years. [65]
4.59 Not all strata schemes are large organisations – some involve
as few as two or three homeowners. The Committee believes that it is unreasonable
for the Government to expect these organisations to take on such an onerous
role in the administration of the taxation system. This measure is bound
to have an effect on the financial security of body corporates because
it discourages savings for future maintenance. This is because the GST
is levied at the same time body corporate fees are paid, yet the tax credits
for GST charged on goods and services can only be claimed when the work
is done – which may be some years down the track.
Private rental market
4.60 The supply of residential rental property is input taxed under the
proposed new tax arrangements. National Shelter and other groups noted
that private landlords will pay GST on management fees, maintenance and
other recurrent costs, and will not be able to claim these back as input
tax credits. There will also be additional capital costs due to increases
in the purchase price of property. These increases in costs will lead
to a rise in rents, as landlords pass some or all of the increases to
private renters. [66] The Urban Development
Institute of Australia (UDIA) also noted that the GST on new homes will
provide less incentive for private investors to invest in private rental
stock. [67]
4.61 DFaCS stated that Treasury estimated that housing costs would increase
by 2.3 per cent as a result of the GST and the Department `anticipated'
that this increase will flow through to the private rental market. [68]
The Department added that `the assumption is that the impact of the GST
would increase landlords' costs by 2.3 per cent and they would want to
pass that on to tenants if they can. Whether they actually can pass it
on to tenants or not will depend upon the market'. [69]
Mr Menner – The federal government estimates that rising
prices of 2.3 per cent across the broader housing market will occur
as a result of the proposed tax reforms. However, the impacts of that
on the housing market will vary considerably in terms of the differential
effects across housing submarkets and stakeholders.
Many of the costs involved in constructing, maintaining or redeveloping
private housing will be treated as input costs and therefore subject
to a GST…Increases in new housing prices will have a flow-on effect
to existing housing stock, resulting in increases in house prices across
the board. Such services as real estate agents' fees, insurance and
legal costs will be subject to a GST, together with the costs of renovating,
maintaining and repairing existing housing stock…
The imposition of a GST on the input costs associated with new and
existing private housing will also have a significant impact on the
private rental market. Whilst rents are exempt from a GST, the additional
input costs highlighted earlier will most likely result in landlords
and investors passing on the full extent of these costs to tenants in
the form of increased rents. Low income private rental households already
face significant housing affordability problems. This situation will
be further exacerbated by the impacts of a GST on the private rental
market.
Source: Committee Hansard, 11.2.99, pp.674-75, Shelter Victoria.
4.62 The Department noted that private renters who are eligible for income
support or Family Tax Benefit can access Rent Assistance (RA) to help
with the cost of private rental. RA is a non-taxable income supplement
paid to individuals and families who rent in the private rental market.
The existing rate maximum RA recipients will benefit from the 4 per cent
increases to RA as part of the compensation package. Those currently receiving
less than the maximum rate will receive an increase if their rents increase.
[70] The Committee concludes that in all rental
markets, but especially in high rental markets, like Sydney, the proposed
increase in RA will go nowhere near compensating the rent increases likely
to occur.
Rent increases
4.63 Evidence to the Committee suggested that the level of rent increases
will exceed the Government estimate of a 2.3 per cent increase. The Housing
Industry Association (HIA) estimated that the long term effect of the
tax plan would be to increase rents by 3 per cent. [71]
The NSW Federation of Housing Associations claimed that the likely increase
in rents could be as high as 11 per cent. [72]
NATO estimated that the impact on rents from the proposed tax changes
will be to increase rents from between $5 and $30 per week. [73]
The Committee notes that modelling by Chris Murphy from Econtech to the
Select Committee showed that rents would increase by 3-4 per cent. [74]
4.64 The variation in these estimates results from the sensitivity of
the analyses to various assumptions, including such factors as changes
in housing consumption patterns, the extent to which landlords absorb
increases in costs, and the length of time it takes for increases in the
cost of new housing to affect other housing sub-markets. [75]
National Shelter noted the Government's estimate of rental increases focuses
at the macro level on the housing market but at the micro level of the
private rental situation for low income earners rental increases will
be greater than the Government estimate.
4.65 NSW Federation of Housing Associations undertook specific modelling
of the impact of the GST on rents for different low income household types
living in private rental accommodation. [76]
The Federation argued that their modelling of the impact of the GST on
private rental housing shows that there are two impacts on the private
rental market that will contribute to a rise in rents – firstly,
an increase as a result of the GST on various direct inputs such as management
costs and maintenance; and secondly, a larger impact from the increase
in the cost price of new housing and the associated flow on effects to
prices of existing houses. The Federation stated that `where the government
predicts an “across the board” increase in housing costs of
2.3 per cent the reality is that this increase in house purchase translates
into a much larger rent rise'. [77] Other modelling
also concludes that the increase will be more than the government's predictions.
4.66 The Federation noted that `using our data, it is clear that all
low income cameos will be considerably worse off after the introduction
of a GST. Given that the only additional expense included in our modelling
is housing, we are very concerned that private renters will have spent
the majority of their compensation on housing before they have met the
cost of other basic needs such as food'. [78]
Compensation for Private Renters Inadequate
The study by the NSW Federation of Housing Associations found, for
example, that couples with children on government benefits renting in
the private rental market `will find that their rent increases are greater
than the total compensation for all cost-of-living expenses under our
model, or at least greater than the increase in rent assistance'. The
Federation concluded that a couple where both parents are unemployed
and who receive the maximum amount of RA, will be `compensated' by the
Government an extra $1.76 in RA a week. The $1.76 amount will not even
begin to compensate a family such as this one for its increases in expenditure.
Source: Submission No.849, pp.22-26, NSW Federation of Housing Associations;
Committee Hansard, 23.2.99, p.808, NSW Federation of Housing Associations.
4.67 Submissions noted that there are a large number of sub-markets within
the private rental market, for example, a high vacancy rate in one suburb
may not apply a few suburbs or towns away. Similarly, vacancy rates at
the top end of the market are unlikely to be the same as those at the
bottom end of the market, and these can affect rent levels. [79]
NATO argued that more research needed to be conducted on the potential
impact of a GST on specific markets eg. high rent cities like Sydney and
places like, for example, Port Hedland or Cairns where rents are in excess
of the national average. [80] National Shelter
also noted that rents are more likely to be raised in $5 steps, so a $3
rise in costs is likely to translate into a $5 rent increase. [81]
4.68 The Committee is persuaded on the evidence that rent increases in
the private rental market will be in excess of the Government's estimates
and that the Rent Assistance increases will not be sufficient to compensate
low income private renters.
Private housing– home purchase
4.69 Under the proposed tax changes, the construction and sale of new
homes and repairs and renovations to existing homes will be subject to
GST. However, DFaCS noted that this will be offset by the removal of wholesale
sales tax currently paid on some materials used in the constructing and
finishing of a house, such as carpets, bathroom fittings and heaters.
Treasury has estimated that the net increase to the price of new house
construction would be approximately 4.7 per cent if there were no other
intervention. DFaCS stated however, that, the cost of buying a land and
house package, will not rise by this amount `as a large part of the land
cost will not be subject to GST. It is anticipated that this will also
flow through to the cost of purchasing an existing home'. [82]
4.70 UDIA noted that while the purchase price of land does not attract
a GST, that only represents about a third of the total costs of developing
the land. Some two-thirds of the cost of developing the housing block
goes in costs that will have a GST applied to them. Thus the cost of the
GST is not purely on the construction of the home, but on the development
of the land. Therefore the cost of the GST impost will be considerably
greater than the Government estimate. [83]
4.71 In situations where residential land is sold by a registered business,
such as a property developer, it is not subject to GST on its full sale
price, but only on the margin added by the business. The Department noted
that it is anticipated that this will also flow through to the cost of
purchasing an existing house. [84]
First Home Owners' Scheme
4.72 To assist in maintaining home affordability the States will be required
to introduce a First Home Owners' Scheme (FHOS) as a condition of receiving
GST revenue. The scheme will apply to Australian citizens and permanent
residents buying or building their first home. To qualify, an applicant
must not have previously owned a home. The purchase of a `first' home
will include the purchase of the land on which a house is to be built
and cover all forms of private dwelling ownership (strata title etc.).
Those qualifying for assistance would receive a non-means tested lump
sum of $7,000. DFaCS stated that the scheme will more than compensate
first home owners on the purchase of a home with a construction value
(excluding land) of up to $150,000. [85]
4.73 Evidence to the Committee suggested that the FHOS was inadequate
in terms of compensation for the new tax burden imposed by the GST. Firstly,
UDIA stated that on a house and land package of $160,000 the GST would
be $12,800, while the proposed rebate is only $7,000. [86]
Secondly, HIA stated that the package is inadequate because it will only
be available to about 15 per cent of new homebuyers. [87]
Thirdly, in Sydney, a house costing $230,000 is in the bottom third of
the housing market, so the rebate will go nowhere near compensating for
the majority of the housing market.
4.74 ACOSS raised a number of equity issues associated with the FHOS
noting that the scheme will not be available to all people facing increased
housing costs. Those who will not be eligible will include purchasers
who are not buying their first home, such as sole parents establishing
a new household after a separation and older people moving to a smaller
home. In addition, the value represented by the FHOS will vary depending
on the housing market. In Sydney, where the cost of housing is well above
the national average, the amount of $7,000 is unlikely to fully compensate
many people for the effect of a GST. [88] Shelter
Victoria argued that the FHOS should be means tested to ensure that it
is targeted to low and middle income households seeking to enter home
ownership for the first time. [89] Master Builders
Australia (MBA) also expressed concern at the absence of means testing
of the FHOS. MBA stated that `there would seem to be considerable merit
in introducing measures that recognise the needs of first-home buyers
with lower incomes. MBA is cognisant of the need to make such means testing
administratively simple'. [90]
4.75 HIA stated that the FHOS grant will be available for homebuyers
purchasing established dwellings, the sale of which is not subject to
a GST. [91] UDIA also expressed the view that
in relation to established properties the rebate is a `give away' and
will compound the price disparity when the GST is imposed on new homes.
It also is a net loss in tax revenue for government. The Institute noted
that this price disparity will suppress demand for new homes – `this
may further accentuate the expected downturn in the property market in
mid-2000 and result in more unemployment'. [92]
4.76 MBA argued that the FHOS arrangements could be improved by a ten-year
guaranteed period for FHOS, after which it would be subject to review;
an annual adjustment to the lump sum payment under FHOS linked to the
ABS New House Price Index; priority given under FHOS to buyers of new
homes to encourage economic activity and employment; and lower and uniform
exemptions for first home buyers from stamp duty on property transfers,
to further improve housing affordability. [93]
4.77 HIA submitted that a more appropriate way of addressing the cost
impact of the GST on new homebuyers would be to make compensation available
to homebuyers purchasing new dwellings. This would involve the exemption
of stamp duty for first homebuyers under the FHOS and a targeted GST rebate
on new houses and renovations. HIA argued that the FHOS should provide
for the exemption of stamp duty on the first $250,000 of a new or established
home purchase. A first home buyer purchasing a dwelling at the average
price of $203,000 would receive a stamp duty exemption worth up to $7,000.
HIA also proposed that under its new home rebate proposal, 50 per cent
of the net GST cost increase would be rebated on the first $250,000 of
a new dwelling purchase, inclusive of land. The rebate would be available
to first homebuyers, purchasers of new rental property and other new home
purchasers. [94]
Costs of home ownership
4.78 Treasury has estimated that the costs of home ownership will increase
by 2.3 per cent. DFaCS argued that this impact will be lessened by the
FHOS, which it was claimed will reduce the overall price increase for
housing. [95]
4.79 These figures were contradicted in evidence to the Committee. HIA
argued that the GST and other tax changes on the residential construction
industry will increase the cost of new house prices by 5 per cent in the
long term and 8 per cent in the short to medium term. As a result of these
higher prices (and rent increases) the consumption of housing services
will fall by about 2 per cent. HIA noted that housing will become `relatively
more expensive, and people will use less of it by choosing fewer, smaller
or lower quality houses'. [96] HIA stated that
the FHOS will only be available to about 15 per cent of new homebuyers.
[97]
4.80 The report of the Select Committee on a New Tax System also found
that the residential housing sector will also be adversely affected by
a GST. Mr Murphy of Econtech suggested the price of house construction
will rise by around 6 per cent and the price of a house and land package
by about 5 percent. [98]
Housing affordability
4.81 Evidence to the Committee from housing industry bodies argued that
the new tax arrangements will adversely affect housing affordability.
UDIA provided compelling evidence on the adverse impact that the GST will
have on the construction of new homes and objected to the fact that the
GST applies only to new homes. New homes are often the most affordable
for first home buyers and Australian families with low to medium incomes.
The Institute noted that prices of homes in new suburbs will rise as a
result of the GST. The implementation of the GST on new homes but not
established homes will lead to pricing disparity in the market that will
depress demand for new homes and land.
Affordable Housing Taxed
New homes tend to be located on the fringe of our major cities. Young
families have tended to move to new suburbs because of the lack of affordability
in established areas. These new residential suburbs are often the most
affordable in our major cities. Unfortunately, the GST applies only
to new homes. As a result new and emerging suburbs (generally more affordable)
will be subject to a new tax that established suburbs will not.
Source: Submission No.509, p.3, UDIA.
4.82 The GST on a sub-divided block without a house is based on the difference
between the price of the land when it was purchased and the price of the
land when it is sold. The Institute noted that therefore all improvements
to the land (roads, drainage, sewerage, water and power supply) will be
taxed. UDIA stated that a block of land costing a developer $45,000 and
sold (after improvements) for $140,000, will have a margin of $95,000.
This will be subject to the GST and therefore the GST payable will be
$9,500. The builder/homebuyer will then build a house for say, $90,000.
That will bring the total land package to $230,000. The GST on the house
will be $9,000 (10 per cent of $90,000). Therefore the GST on the house
and land package will be $18,500. [99]
Tax on a Tax
UDIA was also concerned about the fact that the GST is a `tax' on a
tax. Most of the taxes that affect the housing industry will not be
removed by the Government's tax reform package. Stamp duty and land
taxes on property (State taxes) will remain. The GST will be a tax on
a tax for all of these taxes and government charges. In some cases $20,000
in Government taxes and charges will become $22,000 under the GST. There
is little WST on new homes as it stands, therefore the loss of WST means
very little to the housing industry.
Source: Submission No.509, p.4, UDIA.
4.83 Most economic experts, including the Commonwealth Bank, Bankers'
Trust, BIS Shrapnel and IPC are forecasting a downturn in the housing
industry by mid 2000. This is based on the effects of a GST and the downturn
after the Olympics. The effect on unemployment in the sector will be dramatic.
HIA also argued that there would be a long term permanent decline in residential
building activity of over 2 per cent and the consequent loss of jobs.
[100]
Private housing – owner occupiers
4.84 While the sale of the family home is not subject to a GST, services
such as real estate agents fees, insurance and legal costs are subject
to a GST. The costs of renovating and redeveloping existing homes will
also be subject to a GST, together with maintenance and repairs. These
input costs will contribute to increased prices for existing homes. [101]
4.85 The proposed tax changes will also affect the ability of many households
to maintain their home to an adequate standard, especially low income
homeowners and pensioners. For example, evidence suggested that many elderly
people who may be `asset rich' but `income poor' will find it increasingly
difficult to pay for the costs of house maintenance and repairs. The Council
on the Ageing (COTA) noted that the increased cost for household services
are a `particular concern' of older people because they are more reliant
on outside services to maintain a home and garden. COTA noted that household
services commonly used by older people that will be subject to a GST include
gardening and rubbish removal, housekeeping and cleaning services and
repair and maintenance of household durables. [102]
Commonwealth-State Housing Agreement
4.86 Concerns were raised by several housing groups concerning the future
of the CSHA in the light of the changing Commonwealth-State financial
relations under the proposed tax changes. Under the new arrangements,
from 1 July 2000, the Commonwealth will transfer all the revenues
from the GST to the States, with Financial Assistance Grants to be abolished.
[103] Some groups also argued that this called
into question the future of Specific Purpose Payments such as the CSHA.
[104]
4.87 The current CSHA is due to expire on 30 June 1999, and is currently
being re-negotiated. DFaCS stated that the funding offer for the new Agreement
`is money that is currently contained in the forward estimates, which
is essentially current money less efficiency dividend'. [105]
National Shelter noted that the CSHA has been declining in real terms
in recent years and there has been less funds available for public and
community housing. [106] Shelter Victoria
stated that:
What has been happening in housing assistance funds since the 1980s
has been an erosion of [these] funds in real terms, particularly since
1996 when the federal government applied efficiency dividends to housing
assistance funds…in real terms, housing assistance funds from
the Commonwealth to the states have been declining over the last decade
or so. [107]
4.88 Shelter Victoria noted that if state housing authorities in the
future are treated as commercial entities and therefore subject to a GST
on their input costs `the situation will be that a lot of the money that
comes from specific purpose payments for housing assistance will be lost
to general or consolidated revenue'. [108]
CSHA – Funding Decline under a GST
Any money which gets paid in the GST, even if they get it back through
input credits does not come back into the state housing system. It goes
into Treasury and then Treasury passes it on to state treasuries….I
am very sceptical that they [line agencies] would ever get any more
money out of Treasury to compensate for the amount of CSHA dollars that
are being lost.
Source: Committee Hansard, 23.2.99, p.823, National Shelter.
4.89 The Committee notes that State Housing Ministers recently refused
to sign a new CSHA . They issued a statement that the Commonwealth had
failed to adequately compensate the States for the increases in costs
for State Housing Authorities under the GST. The Ministers in their Communique
stated that:
Housing Ministers…unanimously agreed they could not sign the
Commonwealth's proposed new four-year CSHA as the offer would lead
to significant reductions in housing services around Australia. The
Commonwealth offer does not include any compensation for the impact
of the GST on the States and Territories. The impact of a GST on,
in particular, housing for the aged, people with disabilities and
the homeless, should be fully discussed and understood. [109]
4.90 State and Territory Housing Ministers have recently called for $700
million in additional funding for public housing, including $390 million
to compensate the States for the introduction of a GST. The Ministers'
argued that the present Commonwealth funding offer represents a reduction
of more than $730 million of housing assistance funding over the next
four years. [110]
4.91 In 1995-96 Commonwealth funds to the CSHA were $1.023 billion with
State funding of $520 million. In 1996-97 this level was maintained without
indexation. In 1997-98 Commonwealth funds through the CSHA were cut by
$92 million. [111] This decline in real funds
will be exacerbated by the impact of the GST.
4.92 The GST will have the effect of transferring funds from the CSHA
to consolidated revenue. National Shelter stated:
The GST causes a leak from housing funds into consolidated revenue
as inputs are taxed but credits cannot be claimed. It is true that
there is no loss to the system as a whole because it is government
funds that are being “recycled”. However, the CSHA –because
it is a tied grant– loses significant amounts out of what was
previously a closed system. Once the funds have gone into consolidated
revenue, they will be difficult to track and reclaim. [112]
4.93 Several groups, including National Shelter argued that any funds
lost from the CSHA as a result of the introduction of the new tax system
should be identified and fully compensated. [113]
Conclusions
4.94 The Committee has concluded that the housing sector will be seriously
affected as a result of the introduction of a GST and the new tax arrangements.
4.95 Particularly disturbing was the revelation that the Department of
Family and Community Services had done no modelling on the impact of the
GST on private rentals or public housing.
4.96 The overwhelming weight of evidence was that all sectors of the
community, be they public housing tenants or boarding house residents,
or private homeowners, will be disadvantaged by the proposed changes especially
in terms of access and affordability. The proposed legislation is confusing
and contradictory. Public and community housing providers have been left
up in the air as to their `commercial' or `non commercial' status under
the legislation and will be adversely affected by large compliance cost
imposts. The proposed changes also threaten the continuing viability of
the public and community housing sectors.
4.97 Rent increases are inevitable and the compensation measures will
be totally inadequate to meet the expected large increases in rents. Public
and community housing tenants will face higher rents and longer waiting
lists as public housing authorities grapple with increased maintenance
costs. Private rentals will increase as landlords seek to cover the GST
impost on their costs.
4.98 Site fees for residents of mobile homes and caravans will rise,
as caravan park owners face the choice of either levying a GST or increasing
fees to cover the GST charged on their costs. Strata and body corporate
schemes will be forced to become tax collectors, adding a GST to building
levies. New home prices will skyrocket, with devastating effects for the
construction industry and jobs.
4.99 The new arrangements will increase the pressure on housing costs
for tenants in public and community housing and for private renters. The
changes proposed will affect low income people in particular – the
aged, sole parents, young people and others – many of whom are already
disadvantaged and marginalised. For many of these people, already suffering
under increasingly difficult economic circumstances, the tax changes will
be yet another blow to their chances of either securing or maintaining
affordable and appropriate housing.
4.100 For providers of public and community housing the tax changes will
bring uncertainty and increased cost pressures to a sector already under
pressure from public housing funding cuts and increasing community demands.
In the area of private housing the GST will have serious adverse effects
on the construction of new homes –pushing home ownership, especially
for first homebuyers, beyond their reach. It will cause a downturn in
the sector and have a serious impact on employment which will have inevitable
flow-on effects to the rest of the economy.
Footnotes
[1] Tax Reform; not a new tax, a new tax
system, p.97.
[2] Tax Reform Report, p.97.
[3] Submission No.633, p.4 (National Shelter);
Submission No.876, p.1 (Shelter SA); Submission No.664, pp.2-3 (Shelter
WA).
[4] Submission No.633, pp.2-6 (National Shelter).
[5] Tax Reform Report, p.172.
[6] Submission No.633, p.2 (National Shelter).
[7] Committee Hansard, 23.2.99, p.812.
[8] See Senate Select Committee on a New Tax
System, First Report, February 1999, p.83.
[9] Committee Hansard, 23.2.99, p.812.
[10] Committee Hansard, 2.2.99, p.125.
[11] Submission No.633, p.11 (National Shelter);
Submission No.68A, p.8 (ACOSS).
[12] Submission No.603, pp.1-2 (DFaCS).
[13] Submission No.603, p.13 (DFaCS).
[14] Submission No.603, p.13 (DFaCS).
[15] Submission No.68A, p.8 (ACOSS); Submission
No.633, p.11 (National Shelter); Submission No.328, p.1 (Central Sydney
Region Public Tenants Council).
[16] Committee Hansard, 4.2.99, p.238.
[17] Committee Hansard, 4.2.99, p.370.
[18] Submission No.633, p.14 (National Shelter);
Submission No.68A, p.8 (ACOSS); Submission No.850, p.30 (CPSA/APSF).
[19] Submission No.68A, p.9 (ACOSS).
[20] Submission No.633, p.11 (National Shelter).
[21] Submission No.789, p.8 (NATO). See also
Submission No.1088, pp.iv-v (Queensland Government); Submission No.664,
pp.10-11 (Shelter WA and Tenants Advice Service); Submission No.304, pp.4-5
(Geelong Catholic Social Justice Committee).
[22] Committee Hansard, 23.2.99, p.809.
[23] A New Tax System (Goods and Services Tax)
Bill 1998, Bills Digest, No.97, p.16.
[24] Submission No.633, p.11 (National Shelter).
See also Committee Hansard, 23.02.99, p.808.
[25] Submission No.68A, p.8 (ACOSS).
[26] Submission No.633, p.11 (National Shelter).
[27] Submission No.633, p.11 (National Shelter).
[28] Submission No.849, p.18 (NSW Federation
of Housing Associations).
[29] Submission No.660, p.11 (Shelter Tasmania).
[30] Submission No.675, p.11 (Shelter Victoria).
[31] Submission No.633, p.12 (National Shelter);
Submission No.68A, p.8 (ACOSS).
[32] Committee Hansard, 23.2.99, pp.822-23.
[33] Submission No.633, p.15 (National Shelter).
[34] Submission No.633 (National Shelter),
p.11.
[35] Submission No.633, p.12 (National Shelter);
Submission No.677, p.4 (CHFA).
[36] Committee Hansard, 4.2.99, p.368.
[37] Submission No.603, p.13 (DFaCS).
[38] Submission No.633, pp.12-13 (National
Shelter). See also Submission No.675, p.12 (Shelter Victoria).
[39] Submission No.660, p.14 (Shelter Tasmania).
[40] Submission No.675, p.12 (Shelter Victoria).
See also Submission No.664, p.11 (Shelter WA and Tenants Advice Service).
[41] Submission No.677, p.6 (CHFA).
[42] Committee Hansard, 4.02.99, p.368.
See also Submission No.677, pp.6-7.
[43] Submission No.663, p.12 (National Shelter).
[44] Submission No.633, p.12 (National Shelter).
[45] Submission No.677, p.7 (CHFA).
[46] Submission No.677, p.7 (CHFA). See also
Committee Hansard, 4.2.99, p.369.
[47] Submission No.633, p.13 (National Shelter).
[48] Submission No.677, p.8 (CHFA).
[49] Submission No.633, p.13 (National Shelter).
[50] Submission No.801, p.10 (ATSIC).
[51] Submission No.653, p.13 (NYCH).
[52] These types of accommodation are to be
treated as `commercial residential premises' (Division 87 of the Bill)
defined in the legislation as a hotel, motel, inn, hostel or boarding
house, caravan park or a camping ground. See Explanatory Memorandum,
p.127.
[53] Submission No.68A, p.9 (ACOSS).
[54] Submission No.557, p.13 (Boarding House
Owners and Managers Association and Supported Accommodation Providers
Association).
[55] Submission No.675, p.14 (Shelter Victoria);
Submission No.850, p.26 (CPSA/APSF).
[56] Submission No.557, p.12 (BHOMA/SAPA).
See also Submission No.790, p.1 (North Sydney Council).
[57] Submission No.557, p.1 (BHOMA/SAPA).
[58] Submission No.371, p.1 (Park Residents
Association); Submission No.3, p.4 (Affiliated Park Residents' Associations
of NSW); Submission No.440, p.1 (Caravan and Relocatable Park Residents'
Association); Submission No.1177, p.1 (Palms Avoca Residents' Council).
[59] Submission No.350, p.5 (Park and Village
Service).
[60] Undated, unsigned letter from the Treasurer,
Tabled in Committee, 10.2.99.
[61] Committee Hansard, 23.2.99, p.818.
See also Committee Hansard, 11.2.99, pp. 680, 684; Committee
Hansard, 23.2.99, pp. 809, 818, 840, 847.
[62] Committee Hansard, 25.2.99, p.1062.
[63] Committee Hansard, 25.2.99, p.1062.
[64] Submission No.633, p.10 (National Shelter);
Submission No.68A, p.10 (ACOSS).
[65] Submission No.971, pp.1-2 (UnitCare Services).
[66] Submission No.633, p.6 (National Shelter);
Submission No.777, p.9 (Tenant and Community Initiatives Program); Submission
No.68A, p.6 (ACOSS).
[67] Submission No.509, p.6 (UDIA).
[68] Submission No.603, p.12 (DFaCS).
[69] Committee Hansard, 2.2.99, p.130.
[70] Submission No.603, p.12 (DFaCS).
[71] Submission No.592, p.2 (HIA).
[72] Committee Hansard, 23.2.99, p.812.
[73] Committee Hansard, 23.2.99, p.842.
See also Submission No.664, p.5 (Shelter WA and Tenants Advice Service);
Submission No.750, p.10 (Queensland Shelter).
[74] See Select Committee, First Report,
p.83.
[75] Submission No.68A, p.7 (ACOSS).
[76] The cameos are representative of households
living in housing related poverty. Calculations are based on various household
types in receipt of Centrelink pensions or benefits and RA. Rents are
based on 90 per cent of the median rent in Sydney. The model assumes
an 11 per cent increase in rents. See Submission No.849, pp.22-26 (NSW
Federation of Housing Associations).
[77] Submission No.849, p.5 (NSW Federation
of Housing Associations).
[78] Submission No.849, p.6 (NSW Federation
of Housing Associations).
[79] Submission No.633, p.6 (National Shelter);
Submission No.777, p.9 (Tenant and Community Initiatives Program).
[80] Committee Hansard, 23.2.99, p.842.
[81] Submission No.633, p.7 (National Shelter).
[82] Submission No.603, p.11 (DFaCS).
[83] Committee Hansard, 23.2.99, pp.831-32.
[84] Tax Reform Report, p.97; Submission No.603,
p.11 (DFaCS).
[85] Submission No.603, p.11 (DFaCS).
[86] Submission No.509, p.6 (UDIA).
[87] Submission No.592, p.3 (HIA).
[88] Submission No.68A, p.7 (ACOSS).
[89] Submission No.675, p.7 (Shelter Victoria).
[90] Submission No.338, p.11 (MBA).
[91] Submission No.592, p.3 (HIA).
[92] Submission No.509, p.6 (UDIA). See also
Committee Hansard, 23.2.99, p.833.
[93] Submission No.338, p.11 (MBA).
[94] Submission No.592, p.3 (HIA).
[95] Submission No.603, p.12 (DFaCS). See also
Tax Reform Report, pp.97, 172.
[96] Submission No.592, p.2 (HIA). See also
Submission No.778, pp.1-4 (Migrant Resource Centre Forum of NSW).
[97] Submission No.592, p.3 (HIA).
[98] See Senate Select Committee on a New Tax
System, First Report, February 1999 p.83.
[99] Submission No.509, p.3 (UDIA).
[100] Submission No.592, p.2 (HIA).
[101] Submission No.675, p.7 (Shelter Victoria).
[102] Submission No.795, p.7 (COTA).
[103] Tax Reform Report, p.25.
[104] Submission No.675, p.14 (Shelter Victoria);
Submission No.633, p.14 (National Shelter).
[105] Committee Hansard, 2.2.99, p.127.
[106] Submission No.633, pp.14-16 (National
Shelter).
[107] Committee Hansard, 11.2.99, p.682.
[108] Committee Hansard, 11.2.99, p.682.
[109] State/Territory Housing Ministers' Meeting,
Communique, 5 March 1999.
[110] The Australian, 23.3.99, p.6.
[111] Submission No.675, p.15 (Shelter Victoria).
[112] Submission No.633, p.15 (National Shelter).
[113] Submission No.633, p.16 (National Shelter).
See also Submission No.675, p.15 (Shelter Victoria); Submission No.750,
p.8 (Queensland Shelter); Submission No.664, p.12 (Shelter WA and Tenants
Advice Service).