Money raised from the ACT Government's controversial change of use charge will be used to improve the ''look and the feel'' of Canberra, Chief Minister Katy Gallagher says.
Ms Gallagher and her Treasurer Andrew Barr pledged this morning to establish a $22 million ''Urban Improvement Fund'' in June's ACT Budget with the money coming directly from the levy on residential property developers.
The charge has been the subject of bitter political fighting and frantic property industry lobbying since 2010 when the government discovered that developers had been undercharged for years and resolved to impose the charge, a levy on multi-unit developments.
Mr Barr said this morning that it was ''only fair,'' that developers should contribute some of the profits they made to the wellbeing of the city.
''The ACT Labor Government recognises the important contribution that is made by developers through their building of housing and commercial developments,'' Mr Barr said.
''But it is also fair that when they make large profits from varying the lease on their land for development - making it more valuable - that the community also benefits.
''I expect developers to also benefit from the improved amenity of our city and should acknowledge that their contribution will now go directly to improving the very city they choose to invest in.''
The Treasurer said that the government expected to receive the full forecasted revenue in the 2011-2012, the first full year of ''lease Variation Charge.''
''The Government has forecast $22 million to be received from developers this year - $5.9 million has already been received and another $15.5 million is expected this financial year,'' Mr Barr said.
''This money will now go directly to improving our city in the next Budget.''
This reporter is on Twitter: @noeltowell
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