NSW: ACCC to investigate alleged caravan park GST exploitation

AAP General News (Australia)
04-24-2000
NSW: ACCC to investigate alleged caravan park GST exploitation

By Karen Michelmore

SYDNEY, April 24 AAP - Australia's consumer watchdog is to investigate a New South
Wales caravan park over claims of GST exploitation.

The Australian Competition and Consumer Commission (ACCC) will investigate allegations
the Central Coast caravan park was planning to increase rents 0.5 per cent above the nominated
five per cent GST rise.

But the operators of the Erina Gardens and Karalta Court Residential Home Villages
today rejected the claims, saying residents had misunderstood a letter foreshadowing changes
under the GST and confusion about the new tax, which comes ito effect on July 1.

Fair Trading Minister John Watkins said park residents had complained about receiving
a letter from the operator saying he planned to raise rents by 5.5 per cent from July
1, with a further GST-related increase later in the year.

"The Howard government said park residents would pay five per cent not 5.5 per cent,"

Mr Watkins said in a statement.

"The GST rise should also be a one-off rise, not one bite now and another later."

The ACCC has the power to fine corporations up to $10 million and individuals up to
$500,000 for breaching GST price exploitation laws.

Erina Gardens and Karalta Court Residential Home operator Paul Craig said the letter
was not notice of a rent increase, but had been written to explain the GST changes.

"There was probably a misinterpretation of our letter," Mr Craig said.

"There is no rent increase notice.

"Our only interest is to charge whatever the increase is. I thought 5.5 per cent was correct."

Mr Craig said he had not been contacted by the Department of Fair Trading over the
letter, nor had he received complaints from residents.

He said part of the problem was the confusion surrounding the GST.

"We are getting dribs and drabs of information from the government," Mr Craig said.

Mr Watkins said people in caravan parks should not have to pay the GST at all.

It was claimed yesterday that more than 50,000 battlers living in caravan parks would
be hit by the GST, while thousands of others living in luxury properties would avoid the
tax.

New South Wales parliamentary secretary to the premier Paul Crittenden said some of
the poorest families in NSW who lived in caravan parks would pay an extra $260 annually
on their rents, while tenants renting exclusive $1,000-a-week properties would be exempt.

More than 40 per cent of caravan park residents are over the age of 60, almost three
in four are not in paid work and more than half receive less than $300 a week.

Comment was being sought from the ACCC.

AAP km/jjs/it/bwl

KEYWORD: TAX CARAVANS (CARRIED EARLIER)

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