Real-estate boom to drive new $1b hospital

A BUOYANT economy and windfall real-estate
sale taxes have helped the Tasmanian Government find funds for public housing
and its new $900 million Hospital Capital Fund.

Releasing revised figures for the 2007-08
financial year, Treasurer Michael Aird predicted the Government's coffers
would be $183 million fuller than expected by the end of June.



Instead of incurring a government net operating deficit of $39 million, Mr
Aird said Tasmania would achieve an annual operating surplus of $144 million.




Tax revenue for 2007-08 was expected to be $117 million or 16 per cent higher
than predicted at last year's June Budget, now totalling $869 million for the
financial year.



Most of the Government's tax windfall came from an extra $80 million paid in
conveyancing duties when real estate properties -- now with a higher average
value -- were bought and sold.



There was also an extra $31 million in payroll tax in 2007-08 compared to the
previous year, land taxes totalling $74 million and $17 million of police
fines.



Federal GST payments to Tasmania in 2007-08 were expected to exceed $2434
million, $43 million more than expected.



The tax and revenue bonanza was offset by big jumps in operating and employee
expenses paid by the Health and Human Services Department -- $98 million more
than expected this financial year.



A delay in Gunns' pulp mill construction -- which Treasury did not expect to
start before mid-2008 -- forced a downgrade in state economic growth
forecasts.



Mr Aird said economic growth predictions for 2007-08 had been downgraded from
3.5 per cent to 3.25 per cent.