Lease Variation charge reprieve a welcome step: ACT Greens

Caroline Le Couteur MLA

Today the ACT Greens welcomed the government’s decision today to postpone the introduction of an increased Lease Variation charge (LVC) in relation to unit development.

“The Greens support LVC as a way of ensuring that the community shares in windfall gains from increases in land values,” said Caroline Le Couteur MLA, Greens spokesperson for planning and development. “That said, I did raise concerns with the Government about the impacts of the sudden four-fold increase.

“In imposing any taxation change, we believe that the Government should consult with those affected and model the impacts of the change. It doesn’t appear that the government genuinely consulted with developers and the community on this decision, given reports that they felt ‘ambushed’ by it.

“A decision like this—where developers could end up paying up to $30,000 per new dwelling—is no small undertaking, and warrants genuine consultation with the community before policy changes are brought in.

“We were particularly concerned about the impact of these changes on housing affordability and infill.  The industry has told us that it will lead to a major reduction in townhouse development in existing suburbs. I am concerned that the perverse outcome of this new change could be McMansions in inner city suburbs rather than the missing middle—smaller dwellings such as townhouses and terraces, that we know our community actually want in our city.

“Modelling is also crucial, and should not just include the expected revenue to the government. It should look at wider impacts such as, in this case, housing affordability, housing choice, sustainability and impact of development of the city,” Ms Le Couteur said.

“The Greens would like to see the government consider more nuanced changes to LVC such as imposing a higher rate on more expensive housing to improve housing affordability.

“We urge the government to review these impacts before introducing any change, rather than just giving a one year postponement and then reviewing it in 18 months,” Ms Le Couteur added.