Drastic Tax Changes Advised Due To Climate Changes

According to independent government research, adapting to climate changes brings about the need for changes in the Australian economy; which involves getting rid of property tax exeptions, that discourage families from leaving areas that are prone to extreme weather.

A Productivity Commission draft report released April 26 called for a close analysis of disaster relief provided by the federal government, that during climate change may create “moral hazard,” by giving people less of an incentive to purchase insurance and letting state governments to disregard infrastructure.

Accepting that global warming is inevitable, in their report the Productivity Commission announced that Australia would have to adapt. To do this, they must remove barriers in the areas of disaster relief, taxation, local government, emergency management, planning and building rules.

Conveyancing duty – makes it expensive for people to move and develops a “lock-in-effect,” which should be discarded by having more broad-based land taxes.

This lock-in-effect may also stop people from changing business locations and jobs, which may become an obstacle to effectively adapting to the climate changes.

Although the commission forecasts that Australia is in a good position when it comes to global warming, farmers received some tough love from them – the report said that marginal agriculture may have to be wound up.

Exemptions on land-tax may encourage the farmers to stay working on the marginal land even as climate change makes it increasingly difficult. However, ditching these tax exemptions would more than likely give farmers the incentive they need to move.