Media Release — Short term rental tax is a “lose-lose” proposition that will hurt ACT economy and fail to boost housing supply, say experts
Caption: Floriade will be among the major ACT events experts say will be hurt by the proposed 5% STR levy.
Australia’s peak short-term rental accommodation industry group, ASTRA, says the five per cent STRA levy proposed by ACT Government will damage the territory’s visitor economy and do nothing to boost housing supply.
“We believe the proposed STRA Levy risks unintended negative consequences for Canberra’s visitor economy, with little proven benefit to housing supply, and should be reconsidered,” says ASTRA Chairman Yoav Tourel.
“We support the implementation of a registration system to ensure accurate data collection and improved safety measures. Together, we can create proactive solutions that protect Canberra’s economy and its unique tourism ecosystem."
ASTRA Member Dan White from Canbnb, which has 184 properties under management, says the ACT Government has produced no rationale for the tax, detailed how much revenue it will raise or where the money will go.
White says the tax, due to start on July 1, means accommodation prices will increase, negatively impacting visitor numbers especially during major events such as Floriade.
“The five per cent tax is likely to cause shock and undermine the industry,” says White.
STRA researcher Dr Naomi Dale, a Professor of Management at the University of Canberra and CEO of Canberra Region Tourism Industry Council, doubts the tax is worth the disruption and called it a “lose-lose” scenario.
“It’s doubled-edged,” she says. “It’s going to have a minimal impact on general revenue, but I think it will have a considerable impact on people who are making decisions to stay - Canberra already has a poor reputation as somewhere that’s not particularly cheap.
“It’s a lose-lose in both directions.”
Dr. Dale says she believes the ACT Government doesn’t properly understand the impact the tax will have, “especially if we are taxing family operators who are really just trying to pay the bills”.
She estimates STR accounts for less than one per cent of Canberra’s housing stock and that 60 per cent of visits are for non-tourism reasons such as emergency or worker accommodation, medical stays or for family reasons.
Mr Tourel concluded: "ASTRA is committed to working collaboratively with the ACT Government to develop balanced measures that improve the industry while supporting the vital contributions of the STRA sector to the local economy.”
Media Queries: Martin Kelly, MJKpr, (0414) 774 978
About ASTRA: The Australia and New Zealand Short Term Rental Association is the industry’s peak representative body, representing more than 2000 property owners and management companies.
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