Stamp duty reform on table as Chalmers backs states’ property tax talks | joshgordo
that home buyers be given the choice to either pay stamp duty up front or pay a smaller annual property tax. Once a property has been designated as attracting land tax, it would remain so, even when resold. Premier Dominic Perrottet has called the idea a “once-in-a-generation reform” that would take the NSW economy up a gear.
But it also represents a crucial source of revenue, without which the states would be unable to fund services. Last financial year, the, equivalent to about 27.2 per cent of its total tax haul. The NSW government collected $9.4 billion, or 28 per cent of the tax total. Grattan Institute economic policy program director Brendan Coates said the economic argument in favour of abolishing stamp duty was unambiguous. He said land tax, like council rates, tended not to distort people’s decision-making, unlike stamp duty, which discouraged people from moving house or downsizing.
This political pain would be mitigated if an opt-in approach were adopted, and if the federal government stepped in to fill any revenue shortfall for the states, given the reform would boost the national economy and federal tax revenue. Instead, he signalled he would use next month’s Board of Treasurers meeting to push Victoria’s long-running argument for a fairer share of the federal infrastructure and GST carve-up. Victoria, along with NSW, has also been pushing for a “more sustainable” funding system for health, as the state struggles with hospital staffing shortages and a massive surgery backlog.
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