COVID has changed the way everyone works and where people want to live. In late August, we mentioned Bernard Salt’s term ‘VESPA’s’ (Virus Escapees Seeking Provincial Australia), and this concept continues to resonate in the regions. People are moving from interstate (just talk to some local real estate agents) and there is an interest from business owners looking for a better lifestyle. I received a call last week at Chamber from a business looking to move their operations to Townsville. When I asked why, the answer was clear – “Lifestyle and family time. I want out of the big city”. This is a business with over 20 employees so, as a region, what can we do to ensure his aspiration becomes a reality?
Queensland is well-positioned with our lifestyle and climate to take advantage of this renewed interest in decentralisation and lifestyle. However, as we have highlighted over the past two weeks, other States that are creating policy and tax reform to attract business will be the eventual winners.
As a city of nearly 200,000 people located more than 1000 kilometres from the capital, Townsville is unique. We are resilient, we are resourceful, we are adaptable, we are innovative, and we have an opportunity to seize the competitive advantage.
Queensland needs to compete or risk losing existing and future businesses to NSW and Victoria. The 1% reduction in payroll for regional areas offered in the 19/20 financial year is not significant enough to get the attention of private capital. Let us allow regional Queensland to rebound and grow by removing payroll tax in the regions.
In this year’s Covid-19 Fiscal and Economic Review it states in the assumptions on page 36 that for the financial year 18/19 the State received 4.16B from payroll tax, this was forecasted to increase to 4.321B for 19/20, even with a 1% reduction in payroll tax in the regions. The estimated actual for 19/20 is 4.2B which further highlights that the State does not rely on payroll income from regional Queensland.
The removal of payroll tax in the regions will become a significant catalyst for growth in regional Queensland. With VESPAs relocating, let’s give businesses from around the country, and existing companies expanding their operations the leverage and competitive advantages that tax reform can offer.
Townsville Chamber has written to the Queensland Treasurer Cameron Dick to invite him to meet with us again to discuss the opportunities that exist in Townsville, and how policy settings particularly about payroll tax and stamp duty, will affect not only business confidence but also population movement.