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Brokers implore government to 'create more stamp duty relief'

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Australian Broker | 11 Jan 2013, 07:00 AM Agree 0
A national survey of mortgage brokers has found more than half feel the government isn't doing enough to provide relief from stamp duty tax
  • Patrick | 11 Jan 2013, 09:10 AM Agree 0
    Ad Valorem Stamp Duty is a very unfair tax as it only impacts only on people changing homes. Some may do this many times in a lifetime, paying stamp duty on every purchase along the way, others may purchase a home and live there for the rest of their lives, paying stamp duty only once, or if an eligible first home buyer at the time, never at all. Stamp Duty along with all other state taxes was meant to be replaced by GST. Thanks to the narrow minded Democrats this was compromised by the GST exemptions. It is extemely difficult to know if we benefited as a whole due to the state taxes consequently retained, but even if we did the benefit is distorted. An alternative would be to adjust the land tax duty level appropriately and remove the principal residence exemption so that all property owners pay a proportional annual tax. A phase in could allow taxpayers who have recently purchased a land tax exemption for up to 5 years from the date of their purchase.
  • Gavin R. Putland | 10 Feb 2013, 01:31 AM Agree 0
    If you're a home owner, you don't have to pay stamp duty just because you change your address. If you put tenants in your former home and rent your new address, there's no change of ownership, so you pay no stamp duty, no conveyancing fees, and no commission on any sale. And you become eligible for the “negative gearing” deduction on your old address.

    “But,” you ask, “won't I start paying land tax and rental management fees?” Probably; but that's all income-tax-deductible too — unlike stamp duty, conveyancing fees, and commission on the sale of a principal residence.

    “But,” you ask further, “if I live away from my property for long enough, won't I have to pay capital gains tax?” Only if you actually make a capital gain! No such safeguard applies to stamp duty, conveyancing fees or agents' commissions.

    Of course, if everyone adopts this strategy for avoiding stamp duty, governments will be forced to change the rules; but early adopters will save a fortune in the mean time.
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