Terrible idea to abolish stamp duty on property in Australia.
Will only encourage rampant speculation. Anyone who suggests is a good idea is getting paid or beating an agenda for their own political purposes.
It’s an idea which has been floated for a short while in SA – would lead to very interesting outcomes. Obviously the real estate industry is heavily for this proposal.
There’d no doubt be an initial surge in prices as affordability would rise significantly. Other things such as flipping would become extremely viable with the removal of stamps.
In terms of government revenue I can understand where the logic is – stamp duty is incredibly ‘lumpy’ as a major revenue source and doesn’t allow for effective expenditure control or maintenance, so having a broad base land tax would smooth this completely and allow for better spending patterns.
Corey Batt | Precision Funding
http://www.precisionfunding.com.au
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Stamp Duty is an absolutely horrible form of taxation, it makes entering the market extremely difficult and inhibits mobility which has both a social and economic impact. The fact that its removal would increase the number of speculators is not necessarily a bad thing, speculators and traders would increase the liquidity of the market, as they do in the share market, and as such make it easier and quicker for others to transact. The introduction of a land tax on all real estate, as a replacement, would have the effect of forcing people to use property more efficiently eg there would be fewer single people in large houses.
Having said all of this, I would have an issue with the current system being reformed in isolation to the rest of the tax system. Land Tax is a very efficient tax as it can’t be dodged, The Federal Government, if it could work with the States, could conceivably offer major personal tax cuts as an offset against the introduction of a broad land tax, with both themselves and tax payers being better off. It’s an interesting argument regardless.
Regards
I think stamp duty is high but if we are going to abolish stamp duty we need to have a serious conversation about increasing GST. Because the only other options is to do what they do in States like Texas and Florida where there is no state tax no stamp duty but you pay 3 and 2% property tax. That means in in Texas if you own a home worth $300,000 you are paying $9000 per year.
Nigel Kibel | Property Know How
http://propertyknowhow.com.au
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Yep some of the people who responded when I posted to http://www.Facebook.com/LivePoliticalChat commented around California milking property owners dry.
Anyone who thinks that “Land tax” will stay at 5k a year needs their head read, it will be a major cost factor if stamp duty is abolished…..death by a thousand cuts each and every year
We are all dying a death by 1000 cuts anyway. The fact is land tax, as with GST, is a very simple tax to implement and very difficult to avoid. It is unambiguous and simple. This is far preferable to income tax which is anything but. The problem is that if it was introduced it would be on top of the current system, not replacing it. The most efficient way of funding Governments would be a land tax for the States and GST for the Federal Gov, with all other taxes and levies removed. I know this will never happen.
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