Modern custom built homes in a residential neighborhood

“Abolishing Stamp Duty – the key in supporting Australia’s economy post COVID-19”

Sarah Newman ||

Although first home buyers get the benefit of being exempt or having reduced stamp duty, many other Australians wishing to invest in the property market or simply retirees wanting to downsize their home get stung with stamp duty tax. This tax often deters people from purchasing property.

Stamp duty is often described as the “unpopular” and “inefficient” tax, and abolishing stamp duty could be the key in propping up Australia’s economy following COVID-19.

The Australian Bureau of Statistics’ latest data has revealed that stamp duty revenue has slumped to a four-year low in the 2018/19 financial year. As stamp duty is levied on the purchase price of a property and as such higher priced properties ultimately pay more stamp duty, you can see that stamp duty is greatly reliant on the high turnover of property and/or increases of property prices.

The Australian property market will likely fall due to COVID-19 and because of this stamp duty revenue will decline further in the next 2019/20 and 2020/21 financial years.

What will replace stamp duty?

It is said that a form of annual land tax would be the most likely alternative to stamp duty, however the costs, operation and change over process from stamp duty to land tax is unclear.

The ACT government is leading the way on a stamp duty reform where in 2012, the government began a 20-year process of breaking away from stamp duty to a broad based land tax.

Although replacing stamp duty with land tax is sometimes put in the ‘too hard basket’, it can be done. And when the government does, buyers would soon find their next purchase to be more affordable and in turn prop up the Australian economy.

If you have any questions in relation to stamp duty or the purchase of property, please do not hesitate to get in touch with a member of Coleman Grieg’s Commercial Property team, who would be more than happy to assist you today.

Share:

Send an enquiry

Any personal information you provide is collected pursuant to our Privacy Policy.

Categories
Archives
Author

More posts

Understanding roles in the strata scheme

A strata scheme is a building or group of buildings that have been divided into lots which can be apartments, villas, offices, units or townhouses. This will be articulated in the strata plan.

Can i put my home on Airbnb?

Airbnb is a form of short-term rental accommodation. To add your property to Airbnb in NSW, you are required to meet several laws and regulations governing short-term rentals.

When are liquidators required to seek approval to retain legal counsel?

When does a liquidator (or the company he or she is appointed to) need court, creditor, or committee approval to validly retain a solicitor to act in a liquidation matter which is likely to extend for longer than three months?  The answer to this question has only recently been settled.

Proposed changes to building and construction law in NSW

The Building Bill 2022 (the Bill) is the key avenue through which the NSW Government has proposed to reshape the culture of the building and construction industry by eliminating poor performance and improving the quality of building statewide.

Can you dismiss an employee who fails to return to the office?

Slowly but surely, most employers are requiring employees to return to the office for at least a portion of their working week. Some employers continue to struggle with employees resistant to returning to the office or those who have an expectation that they can continue to work from home whenever it suits them.

New powers to combat phoenixing in construction

The rise of phoenixing in the building and construction industry in Australia in recent years has proved a significant challenge to regulators. Mismanagement of time or cashflow can quickly propel businesses into insolvency.

The NSW Building Commission’s extraordinary powers

In late 2023, the NSW Government passed the Building Legislation Amendment Bill 2023 (Amendment Bill). The Amendment Bill established the NSW Building Commission and granted it extraordinary powers to enter construction sites, inspect work and take away information and materials.

© 2024 Coleman Greig Lawyers   |  Liability limited by a scheme approved under Professional Standards Legislation. ABN 73 125 176 230