Public feeling mixed on increased housing tax


PUBLIC views on the recent increases in the government’s housing benefit tax are mixed, according to the National Research Institute.
Monash University senior taxation lecturer Dr Ken Devos told The National the initial reaction of the people to the change was split.
“The results are showing that those initial reactions were correct – that there is mixed feeling around the increased housing benefit tax,” he said.
Devos said the public view could be distorted by the lack of information.
He said the media played a vital role in disseminating information to assist the public make informed judgments.
Devos said a draft report was compiled with the assistance of NRI researchers. He presented the report at a seminar hosted by the NRI yesterday in Port Moresby.
He said the government argued that this measure was on horizontal equity grounds, meaning people who were receiving the same amount of pay must pay an equal amount of tax.
He said people who received cash allowances would be taxed on their marginal rates based on it being part of their income. On the other hand, for employees who were getting housing benefit tax, their employer
was providing a separate concessional tax.
Therefore those with housing benefit tax are at an advantage over those who were paying the high rates on their cash allowance.