Scrap stamp duty and increase GST in its place, says Property Council
The Property Council of Australia, a real estate industry advocate, wants to scrap stamp duty and extend GST in its place.
Ken Morrison, Chief Executive of the Property Council of Australia, says stamp duty is “the worst tax in the tax armory”.
“Stamp duty does almost everything that stamp duty shouldn’t do. It locks people into housing that’s inappropriate for them,” he told 3AW’s Tom Elliott.
“You’re getting less transactions in a market, and that means you’ve got less investment, less jobs.”
Mr Morrison said typical stamp duty on a Melbourne property was $4000 two decades ago, now it’s $32,000.
He floated two possible taxation approaches which could compensate for the taxes lost through scrapping stamp duty.
One approach involves the introduction of an annual land tax, which would cost the average Melburnian homeowner $5000 a year.
The second approach involves extending GST, either by applying it to all products sold in Australia, or increasing the GST rate above the current 10 per cent.
“If you’re looking at the changes that we could make to our taxation system to raise the same amount of revenue, but do that more efficiently so you had more activity in the economy, more growth, more jobs, then you’d look at offsetting the stamp duty revenues with something like a GST extension,” he said.
“That’s pretty much the only way you’re going to be able to get, practically, stamp duty abolished.”
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