The truth about the rush to phase out stamp duty
Michael is joined by Judith Sloan, Contributing Economics Editor with ‘The Australian’, who says she must be about the only economics commentator in Australia not jumping for joy at the announcement by NSW Treasurer Dominic Perrottet to phase out stamp duty on properties and replace it with an ongoing land tax.
‘The plan involves giving purchasers a choice of paying stamp duty upfront or paying an ongoing tax based on a fixed component plus a percentage of the unimproved value of the property. A figure of $2500 a year is quoted as typical’, writes Ms Sloan
‘The top 20 percent of properties by value will not be included in the plan, with those purchasers still required to pay stamp duty. Once an owner opts to pay the annual tax, that property will always be subject to the tax. It’s a one-way street.’
Ms Sloan discusses with Michael some of the arguments about the switch from stamp duty to land tax that make clear that some of the assumptions needed to conclude that the switch is a definite plus are not necessarily met.
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