This is the first edition of the BCA’s Regulation Rumble, a jurisdictional scorecard that ranks regulation and business taxes across Australia’s states and territories.
Regulation, red tape, and taxes make it more difficult and more costly to run a business. That means less jobs and less investment by the private sector.
As the BCA’s Seize the Moment report released in August makes clear, the cumulative burden of regulation is a significant issue for companies around Australia. It adds costs, causes delays for customers, and limits flexibility.
Businesses face duplication and inconsistency across the Federation. Frequent changes to laws and regulations, and a poor understanding from policymakers and regulators of the complexity, time and cost of implementing these changes, is adding to the pressure. The patchwork of regulation across the nation discourages investment and is a barrier for companies to expand and trade across state lines or overseas. A competitive tax system and effective and efficient regulation are part of the economic fundamentals necessary for a more resilient, diversified, and dynamic economy.
A well-functioning Federation underpins the efficient delivery of government services and achieves better community outcomes for each dollar spent. State and territory governments should pursue reforms that benefit the economy. And yet recent ad hoc payroll tax increases in Victoria and Queensland will see businesses paying more than $2.2 billion additional tax each year – a disincentive for them to grow and create more jobs in those states. Companies will look elsewhere to do business and invest in new projects.
Australian cities are among the most expensive in the world for housing, as measured by median house price in comparison with median income. BCA-commissioned research shows that the cost of housing – the combination of mortgages and rents – is the biggest financial worry for Australians, above groceries, electricity prices, health costs, or petrol. Australia is failing to deliver enough new homes to satisfy demand, with growth in new housing supply falling.
The BCA’s Housing Australia’s Talent paper released in May, underscored that Australia critically needs more housing, and the nation’s planning systems are holding the country back. This edition of Regulation Rumble has a specific focus on land use planning, together with state taxes on employment and property.
If Australia is going to be successful in addressing housing affordability, then planning and stamp duty are some of the most important regulations and taxes to be fixed.
The research in this paper has been put together by experts in the planning industry, together with economists and policy experts with expertise in taxation.
These rankings capture a snapshot in time, in July 2023. We want all states and territories to have best practice regulatory settings. In the coming years, as reforms and changes occur, we absolutely want to see jurisdictions rise up the ranks as they seek to outperform others. Together this will lift Australia’s productivity and facilitate further business investment and employment growth.