The NSW Treasurer’s stamp duty reforms will stifle investment and hurt the community. Property Council Executive Director Jennifer Cunich says the NSW Mini-budget decision to introduce stamp duty to the sale of property is absurd and Victoria has no justification to follow suit.
“Property is already taxed at an extremely high rate. Taxing the vendor of property, as well as the purchaser has the potential to bring property transactions in NSW to a standstill,” Ms Cunich said.
“Imposing this type of burden will stifle future investment, and act as a barrier to property transactions of existing stock, in the long run hurting rather than healing budget problems.”
Ms Cunich says she would be very surprised to see such drastic action on Stamp Duty in Victoria as the State budget circumstances are so different.
“Property taxes currently account for over 30% of the Victorian state tax revenue - there is no justification for increasing the burden on the sector. Victoria does not have the same fiscal pressures as NSW, and so there is no need for such drastic fiscal measures or picking on easy targets.”
Mr Egan also announced changes to the Land Tax rates and scales and the Property Council acknowledges that these changes appear favourable.
“The NSW Government’s Land Tax reduction strengthens the case for land tax reform in Victoria.
“Reducing of the top rate from 1.7% to 1.4% will provide relief to business and puts it’s top rate far below other States. Broadening the land tax base by abolishing the basic threshold follows good tax design principles, although it must be said adding new rates scales unnecessarily complicates the system.
The Property Council in Victoria advocates for a comprehensive reform of the land tax system, and a commitment to phasing out stamp duty as part of the GST Intergovernmental Agreement (IGA).
For further comments contact:
Jennifer Cunich, 9650 8300