7 October 2021

ACT Budget: Your rates and what you will pay

| Ian Bushnell
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Aerial View, Drone, Weston Creek, Houses

Rates will continue to rise as part of the ACT’s tax reform program, as stamp duty reduces. Photo: File.

The ACT Budget shows a 3.75 per cent average increase in residential rates for both units and houses, but rises will vary widely across the Territory depending on the type, size and location of the property.

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The tables below supplied by the ACT Government show your new annual rates bill and how much it may have changed.

New rates

Notes:
Average rates do not factor in pensioner or COVID assistance general rates rebates.
Suburbs with five or fewer rateable properties are excluded, to protect tax payer privacy.

New rates by land size a
New rates by land size b
Notes:
Categories with five or fewer rateable properties are excluded, to protect tax payer privacy. Total number of rateable properties by suburb has been adjusted accordingly; suburb numbers do not sum to total numbers for the Territory.
General rates averages are for non-unit titled residential blocks with AUVs under $4 million. Larger value properties do not represent of general rates paid by houses as they include properties like large developments, retirement villages, and public housing.
Increase in total average rates is less than 3.75 per cent as residential blocks with AUVs above $4 million are excluded.
Average rates do not factor in pensioner or COVID assistance general rates rebates.

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HiddenDragon9:23 pm 08 Oct 21

It will be so entertaining watching NSW’s shiny new premier trying to sell the stamp duty-rates/land tax trade-off dogma in a jurisdiction where the majority don’t always vote the same way, regardless of provocations to the contrary.

After an initial burst of enthusiasm on this issue, Victoria has gone very quiet and it’s pretty much crickets elsewhere in the country – but at least, here in Canberra, housing is now so much more affordable, just as they promised us it would be under this “reform”………

Do the suns on what it would cost to pay stamp duty at the rates of say 10 years ago. What would you rather?

When did they suggest the reform would a big factor for housing affordability?

Yes, it will impact it but these taxes are only a tiny part of a much wider and complex issue.

The main drivers of this taxation reform are around wider economic impacts and creating a more stable and efficient taxation base. They should just get it done faster.

Shock horror I’m in agreement with you Chewy.

There is a very simple way to solve this problem once and for all, and avoid a lot of the ACT’s pain in the process.

It would involve increasing the GST rate, using a fair chunk of that revenue to offset stamp duty losses for the states, and then recovering some of the lost stamp duty through the broad based land tax. Could be solved overnight almost – whether its an optimal solution is another question altogether however.

JS9,
I think they should do both, raise the GST and have a broad based land tax (amongst others)

Then they could reduce taxation in the areas that we most definitely rely on too heavily. First area, income tax.

Small steps chewy, small steps lol. Just getting any meaningful tax reform on the agenda would be a good first step ha.

The small steps that the ACT Government has taken on the Stamp Duty component of their Rates reform has allowed Mr Barr to double dip on both Rates and Stamp Duty.

Chewy and I have disagreed on elements of this tax reform over the years, but Chewy’s absolutely right that they either have to hurry up and properly cut Stamp Duty heavily (or my words here), not not do it at all.

Tinkering with the Stamp Duty percentages every year isn’t keeping up with rising housing prices and therefore the reform isn’t delivering on the proposed benefits of cutting Stamp Duty and encouraging downsizing or better use of housing resources.

A median house sale in Canberra currently pays about $36k in Stamp Duty. ACT Government is collecting higher rates and still fleecing your average homebuyer through Stamp Duty.

It’s laughable to have no Stamp Duty for off the plan properties below $500k, there’s next to nothing available in this price bracket and the developers will dump you if prices go up anyway.

BJ,
Yes we disagree on parts of the policy, but that’s why I think they need to go faster because going slow is too open to abuse by politicians looking to increase taxes in property booms as well as opening up political lines of attack around what is a sensible economic policy.

They should set a timeframe of less than 5years to get it done.

Finally Relented7:27 pm 07 Oct 21

I’m still waiting for a response (for last several years) as to where my refund is for rates..lol…wondering why I have paid full stamp duty AND now land tax. Unfair.

Whether you like it or not, this government has for almost a decade now had the same clear plan as to what they were going to do. It is not like it has been hidden and just appearing from nowhere.

This is why Canberra has the highest rents in the country. As a landlord I will passing this 3.75% on to my tenants plus an additional 20% in line with the revaluation of my UV of land which forms the cost base on which these exorbitant taxes are levied. Even then I’ve only broken even and not made a profit so my tenants can thank the government for this.

Err … no, mate. You definitely won’t. It’s worrying that you purport to be a landlord yet you’re not aware of this incredibly basic piece of legislation about rental increases. Here’s a simple PDF to break it down for you since you don’t seem to be aware of the Act.

https://www.justice.act.gov.au/sites/default/files/2019-10/Fact%20Sheet%20-%20Residential%20Tenancies%20Amendment%20Act%202019%20-%20Excessive%20Rent%20Increases.pdf

LOL at Sam thinking landlords can arbitrarily raise rents as they feel like it.

Andrew Muratore1:54 pm 07 Oct 21

Are…are you claiming that an increase in the UAV of your land is a cost to you as a landlord? You know the UAV goes up because your land is worth more, right? As in, you made money on your investment? The exact opposite of a cost?

Jayne, I’m well aware of the appropriate legislation and the one you have cited applies to “fixed term agreements”. My contracts with tenants are all 1 year so that I can evict them at the end of the 1 year period and advertise for a higher rent with a new tenant.

Andrew, it is a cost as it is not a realised gain determined by market forces but an arbitrary assessment of the value of my land when it has not gone to market. I’m happy for my land to be revalued when I sell it and can pay CGT at that point but am not happy to be taxed on an arbitrary revaluation of it while it is under my ownership. Hence i will pass the cost on and so will others.

Scott Anthony3:50 pm 07 Oct 21

err… yeah he will and so will every other landlord and you only need to open your other eye to see that rents are already very high, and climbing higher.. pretty pamphlet though, don’t think it’ll do much to keep the rain off… wake up..

Scott Anthony3:51 pm 07 Oct 21

Yep, I sold my ACT investments and moved them to QLD, none of this rubbish so far and good ROI for positive cash flow. Its a pity as this used to be a real awesome place to live and make a dollar on once.

Sam,
You make me laugh.
You are saying at the end of your tenant’s leases, you I tend to evict them (without due cause), then secure new tenants and increase the rent by 23.75%. (3.75% for the increase in your Rates & another 20% because the rateable value of your land has increased).

I’m actually a little surprised that you haven’t allowed for the increase in Land Tax, which will flow from an increase in Rates!
Land Tax is levied at 1.5 times the amount of your Rates. So if your Rates are increasing 3.75%, go on, add another 5.63% to account for the increase in Land Tax. So that’d be an increase of 9.38%, plus your other 20% increase.
You’re so close to 30%. Have any of your other costs increased? Insurance maybe?

It’s no wonder that the Greens are keen to readjust the balance between the rights of landlords and tenants.

I made it a “pretty pamphlet” so as to keep it simple for OP since he seems not be be aware of basic legislation. I didn’t want to overwhelm him with the actual Act. Thanks though!

Cute that you think landlords will be able to arbitrarily ignore their tenants’ legislated rights though, Scott 🙂

Sam,
Now you’re also saying you don’t know how the UAV’s are calculated because they most definitely are based on market forces, which are directly included in the calculations.

Funny also that you talk about “market forces” and “arbitrary revaluations”, whilst literally claiming that market forces don’t affect rents amd that you can arbitrarily increase them.

I’m now fully convinced on the satire. Well done.

Are you sure you copied the data down correctly. For example, The number of blocks per suburb doesn’t seem correct.

They look fine to me. Sure you are reading the headings properly?.

One table is units the other houses. And with the houses it is split blocks under 600m2 and blocks over 600m2.

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