Property stamp duty too taxing for families

Date: 11 March 2011
First National has joined the voices calling for a reform of state taxes, particularly inefficient ones like stamp duty, saying it is proving too taxing for working families to pay.

“Stamp duty has become nothing more than governments gouging money from those who can least afford to pay working Australian families,” a spokesperson said.

“Australia has already proven to be one of the most expensive property markets in the world and excessive property taxes, like stamp duty, is making it incredibly difficult for new entrants to gain access to the market or for existing home owners to upgrade.” According to two independent studies, the Demographia International Housing Affordability Survey 2011 and the Housing Industry Association’s most recent survey, residential property in Australia has become increasingly unaffordable.

According to the spokesperson, the situation with the Australian property market is becoming untenable and needs to be addressed at a national level.

“We have a chronic shortage of supply, worsening home affordability and an increasingly tight rental market, which could all be partially addressed with a more realistic approach to property taxes, such as stamp duty,” he said. “In some cases, the one home and land package, could be levied three times with stamp duty. I can’t think of another situation where the one item can be taxed three times.

“The people who come off the worst in this situation are hard-working Australian families.” He said that at a time when rents are soaring, vacancy rates are tight and there is a shortage of supply, there is a real potential that more Australian families will be forced onto the streets increasing homeless rates and welfare payments and further adding economic stress to the Australian economy. “Serious consideration needs to be given to addressing the problems with the Australian property market if there is going to be hope for future Australians to realise home ownership dreams,” he said. “Plus, as the Henry Review points out, transaction taxes such as stamp duties reduce economic efficiency, either by discouraging turnover or being embedded in the cost of production, which just increases the problem.

“Inefficient property taxes including stamp duty are now the biggest single non-income tax generator of cash for Australian governments and the Commonwealth needs to act to reduce the states dependence on these taxes.

“An ideal opportunity presents itself at the federal tax summit which we expect to be held in the middle of this year let’s just hope the governments don’t find the whole matter too taxing.”

First National Real Estate
Back to articles Filed under: Media / National News Tags: downsizing, first home buyer, house and land package, property investing, property tax, retirement planning, stamp duty
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