Victorian Budget delivers infrastructure and incentives

EXPERT OBSERVER

The Victorian Budget 19/20 has been adjusted to deal with the biggest write down in revenue in Victoria’s history.

This is due to the challenging headwinds for Victoria’s property market with sales volumes down 24 per cent and cooling values as we have seen over the past year.

Victoria’s property industry remains the cornerstone of the Victorian Budget, continuing to contribute 46 per cent of revenue and $10.5 billion in land tax and stamp duty alone in the next financial year.

The Budget delivers on the Government’s bold and ambitious infrastructure investment plan and has addressed many of the priorities outlined in the REIV’s Election Platform and Budget Submission.

In particular, the REIV welcomes the payroll tax relief for small business and commends the Government for adjusting the rates in Regional Victoria so that by 2022/23 regional businesses will pay the lowest payroll tax in the nation.

The Victorian Government will invest $2.6b to support jobs, economies and communities in Regional Victoria and an additional $150m in the next financial year to establish the Victorian Jobs and Investment Fund.

The REIV is also pleased with the investment in new urban growth corridors and precinct plans which we have consistently advocated for.

Included in this is $173m for the Geelong City Deal and an additional $18.8m for services.

We welcome the Fishermen’s Bend Framework which includes homes for 80,000 people and the investment in the innovation and employment clusters in Sunshine, Monash, Dandenong, LaTrobe and Werribee.

The Government has also committed $50m for the Growing Suburbs Fund to build and upgrade new community facilities in Melbourne’s 10 rapidly-developing interface municipalities.

The REIV commends the Government for its commitment to education and training with historic expenditure in the sector.

We will work with the relevant bodies to ensure the ongoing professionalism and upskilling of our industry which was a fundamental tenet of the REIV’s Budget Submission.

We also welcome the $2.5m support for mentoring for small business.

Other noteworthy initiatives include the extension of the Better Apartments program to the suburbs, the expansion of solar homes and the 50 per cent discount on land transfer duty for commercial and industrial properties in Regional Victoria in four year’s time.

The Budget is still heavily reliant on property taxes.

While we congratulate the Victorian Government on many positive initiatives, the reliance on property taxes is of great concern to our industry.

We appreciate the government has a big infrastructure agenda, but they can’t keep dipping into the same revenue pot to fund their promises.

The REIV and the industry predicted the property market correction and planned accordingly, but it seems the government did not.

Robyn Waters is the president of the REIV.