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Revenue 'gushing' into Treasury coffers: Time to stamp out stamp duty?

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Australian Broker | 20 Nov 2013, 08:00 AM Agree 0
Stamp duty tax can be a significant deterrent for first home buyers - but should it be done away with entirely?
  • Campbell Simpson | 20 Nov 2013, 08:59 AM Agree 0
    What would replace stamp duty revenue? Maybe a better idea is for Canberra to phase out tax concessions - negative gearing losses could be quatantined so they get carried forward until the investment starts making taxable income. That would put downward pressure on prices, helping FHB, but add to Government revenue.
    Tasmania expects their health costs to match every cent of revenue they get by 2025, Qld by 2030 and NSW by 2032, so states need money from somewhere (or maybe just cut out this middle tier of Government). Thye OECD predicts federal debt to hit 70% of GDP due to the ageing population so they can't easily fund tax cuts either.
  • Scott Beattie | 20 Nov 2013, 09:42 AM Agree 0
    "What would replace stamp duty revenue?"
    I have an idea, we could introduce a tax, let's call it GST as an example which would replace all other taxes and there would be no need to have things like stamp duty and the like...
  • DanG | 20 Nov 2013, 09:46 AM Agree 0
    Perhaps stamp duty should be paid only by a vendor, percentage based on how much the property has increased since they purchased it

    New buyers will get into property easier, and, when you sell you should be able to afford the stamp duty with equity built in the property. If not, you pay a cost that you would have anyway but had more time to prepare for.
  • Country Broker | 20 Nov 2013, 09:56 AM Agree 0
    When the GST was introduced it was sold on the basis that certain state charges would disappear , such as stamp duty , during the negotiations to have every state agree to the changes very few state charges were actually abolished. Stamp duties were one of those state charges that remain.
    If you want to get rid of stamp duty it would to be replaced with either an increase in GST ( it works as it is payable on construction cost) , or introduce a new federal tax that is more equitable between the all the states !
  • dennis martin | 20 Nov 2013, 10:06 AM Agree 0
    why not use a tier system where for first home buyers say up to $350,000.00 no stamp duty then say 1% to $500,000.00 2% to $750,000.00 and 3% above, I feel this would make it easier for them to purchase their first home be it new or existing.
  • Country Broker | 20 Nov 2013, 10:11 AM Agree 0
    Campbell has the right idea , get rid of Local Government and State Governments all together and have only two tiers of Government , one Federal that collects all taxes and the Regional Governments who only collect municipal rates. This country is only 23 Million people with 3 tiers of Government and 3 tiers of taxes , we are over Governed over regulated and over taxed .
    How much does each State Government cost to run !
  • mikeh | 20 Nov 2013, 10:29 AM Agree 0
    I seem to recall in about 1999 an agreement was reached between the states and commonwealth that a number of state taxes (including stamp duty) were to be done away with in return for GST receipts. Another case of non-compliance?
  • David | 20 Nov 2013, 11:12 AM Agree 0
    And what about the people who have paid stamp duty already? I have paid over $500,000 in stamp duty in the last few years building up a property portfolio and I have now purchased everything I need to and am consolidating. If I was hit with other costs such as an ongoing tax (not to mention on top of land tax) I would be double paying!
  • Glynn | 20 Nov 2013, 11:58 AM Agree 0
    Remember Stamp Duty was introduced by the Government of George III in the 1770's as a temporary measure to fund the war in the colonies. I think trying to remove it might take a bit longer yet.
  • mac | 20 Nov 2013, 12:59 PM Agree 0
    NSW still charges bloody mortgage duty on non resi investment, business purposes and mortgages in non personal names!!! Abolition keeps getting put back its been 8 years. If they cant get rid of this I cant imagine them scrapping the big one.
  • Francis Armstrong | 20 Nov 2013, 01:11 PM Agree 0
    Stamp duty impost is a major clog to commercial and residential sales. Whilst resi may be on the march, commercial sales languish because over $1m the Govt charge 5%. To generate acitivity in both spheres stamp duty should be reduced to 2% flat.
  • Steve Pacey | 20 Nov 2013, 02:53 PM Agree 0
    It would open the way for Death Duty or Inheritance Tax to replace the income.
    Already there with some of the Superannuation transfers.
  • Old Joe | 20 Nov 2013, 02:56 PM Agree 0
    I think Stamp Duty is a good way of keeping short term speculators out of the market and flipping homes as soon as they buy them. It has been around for a long time and is a good source of revenue for the state government who don't enjoy the capital gains tax the Fed gets form investors.
  • Mrsskybum | 20 Nov 2013, 05:00 PM Agree 0
    For those of us brokers that know, there is already a rebate on stamp duty which is a one off, maybe we could look at making stamp duty applicable only to income producing properties. Investors can already claim it as an expense at tax time so the only real losers at the moment are o/o purchasers.

    I do agree that we have to many level's of government for a country as little as Australia. Our tax's go to funding their gravy train and it's wrong. We as the average worker or self-employed don't get a pension based on what we earn t at our last job. In fact some of us don't get anything. Where is that fair for all Australian's young and old. Our super is nothing to their super. So make them go live on it like we have too and cut the expenses to us of us out there working our buts off to survive.
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