With just days to go before the federal budget is released, a leading building group is pleading with the federal government not to renege on promised tax breaks for green building initiatives.
The Green Building Council of Australia says scrapping the promised $1 billion Tax Breaks for Green Buildings program would prevent Australia from taking simple and effective steps in reducing the nation’s carbon footprint.
“Buildings represent the fastest, most cost-effective opportunity to reduce our greenhouse gas emissions,” Green Building Council chief executive Romilly Madew says. “They are truly the lowest of the low-hanging fruit.”
Madew says the Council was supportive of the Australian Government’s decision to put a price on pollution as they understood it would be supported by a range of complementary measures to support energy and material efficiencies within the property and construction industry.
The Tax Breaks for Green Buildings program, she says, is an essential component of these measures.
“Without this program, the greatest opportunity to improve energy efficiency, at the least cost, will be missed,” Madew says.
Under the program, businesses would be able to claim a one-off bonus tax deduction of 50 per cent on the cost of investing in eligible assets or capital works that would improve the efficiency of existing buildings. The program, a 2010 election commitment of the Gillard government, was originally expected to start on July 1, 2011 but was postponed following extensive industry consultation, with the Australian government committing to a July 1, 2012 date.
Thus far, however, no mention of funding for the program has been made by the government. Given current fiscal pressures, along with political pressure for the government to meet budget surpluses, there are fears that the government may try to quietly delay or scrap the program.
Madew says that if implemented, the promised $1 billion will do more than simply reduce greenhouse carbon emissions. She says research from Davis Langdon, a construction consulting firm, shows that retrofitting a significant quantity of commercial stock will support the growth of green skills and has the potential to create more than 10,000 building and construction jobs.
Madew also says the property and construction industry has demonstrated a commitment to sustainable building. While the industry understood the need for balance between regulation and incentives, she says, removing the ‘carrot’ of the tax breaks program would leave the industry with ‘only the stick.’
“The industry has been calling for – and has been promised – incentives and tax breaks for green buildings for a long time”, Madew says.