The state's peak building and civil construction groups have advised the government to provide interest-free loans to councils for headworks charges to allow for swifter delivery of new housing subdivisions.
Civil Contractors Tasmania and the Master Builders of Tasmania on Sunday released its Rebuilding Tasmania plan which contained proposals for short-term economic stimulus, government infrastructure projects, regulatory reform and tax incentives.
Under the proposed loan program designed to incentivise private sector investment in new housing projects, developers would repay the interest-free loans to councils over five or ten years.
The plan has proposed an increase to the Home Builder Boost to $40,000 over 12 months and expansion beyond first-home buyers to anyone who wishes to build.
The bodies want the government to fund an asbestos removal program for public and private buildings.
They have asked the government to consider a rebate on taxes and charges where a development application had been lodged this financial year or in 2018-19.
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Civil Contractors Federation chief executive Rachael Matheson, said that building and construction is facing a $1 billion hit in Tasmania.
"There are around 500 projects, big and small, across the civil, commercial and residential sectors and right around the state that already aren't going ahead as planned because of COVID-19," she said.
"It's one thing for the government to set bold targets and even bolder budgets, it's another thing to deliver on that."
Master Builders Association state executive director Matthew Pollock said there had been a 6.5 per cent downturn in employment within Tasmania's construction industry between March 14 and April 4 which roughly translated to 1200 jobs.
"We know from previous recessions that if the government doesn't act immediately to support our industry, the workforce can drop by up to 30 per cent and it often takes years to recover," he said.
State Growth Minister Michael Ferguson said Premier Peter Gutwein had worked with Treasury to determine which projects in its 2018 infrastructure pipeline could be brought forward.
He said all ideas in the Rebuilding Tasmania were under consideration.
The RACT on Sunday called for the government to commit to funding for road upgrades on the West Tamar Highway and the Bass Highway near Boat Harbour.
Mr Ferguson said they had also been considered by the government.
"There will be smiles all round on some of those very important infrastructure projects," he said.
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