Property taxes such as stamp duty are inefficient and should be abolished, according to the Real Estate Institute of Australia (REIA).
“The next government needs to make the tough decisions. Action, not rhetoric, is what’s needed now,” says REIA president, Peter Bushby. “Stamp duties on property transfers are not only inefficient but they are costly to manage, reduce national competitiveness and productivity and are unequally and unfairly applied.”
Bushby argues that taxes set by all three tiers of government have an impact on housing affordability and that stamp duties, land taxes, risk premiums and finance charges push up the cost of new housing and restrict supply.
“The average tax burden on the new housing sector is estimated at around 31% of the value of output. It’s estimated that the removal of some inefficient taxes could reduce the cost of housing by around 10%.”
The REIA is calling for the establishment of an independent, on-going Tax Reform Review Group, comprising industry and welfare groups, to have an advisory role to government and the Parliament on a schedule for tax reform.”
“We welcome comments by the opposition that all taxes, including GST, will be reviewed by the Productivity Commission and that unnecessary taxes will be abolished. This will encourage business to grow and create more jobs,” says Bushby.