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Sep 21, 2011

Stamp duty removal not the silver bullet to making housing more affordable

Calls to cut stamp duty are not the whole answer to tax reform, said Australians for Affordable Housing (AAH) today.

AAH Spokesperson Sarah Toohey said that more comprehensive tax reform is required to really improve housing affordability for all.

While it is not a popular tax with purchasers, cutting stamp duty alone is not the answer to the housing affordability crisis. In isolation cutting stamp duty won’t address speculation that drives up house prices,” said Ms Toohey.

Tax reforms are an important aspect of addressing the housing affordability crisis. But rather than quick fixes or knee-jerk calls, we need to examine a range of measures that will work in conjunction to actually improve housing affordability.

We do welcome a robust debate about tax and housing in the Government’s upcoming tax summit and believe that as part of broader reform there are strong arguments to cut stamp duty over time and replace that revenue with a broader based land tax.

Key Australians for Affordable Housing partners including ACOSS, National Shelter and the Community Housing Federation have already made submissions and will be attending the Tax Summit. Housing should be a central issue of debate at the summit.

We most certainly need tax reform to improve housing affordability in this country, but not just by headline-­grabbing calls for the removal of stamp duty, but from a considered, and broad range of reforms that will work to improve the problems for all,” said Ms Toohey.

  • Anonymous

    Stamp Duty is a ‘easy take’ for governments to bolster their revenue, while harming the economy. Stamp duty and any other transaction taxes will add to the cost of housing. Worse, people only incur those taxes when they change houses. That encourages people to stay put, leading to less labour mobility, workforce flexibility, and (often) increased commuting time. Only a seriously stupid country would put such a regime in place.
    Land tax, on the other hand, is an annual charge on the location we choose to live in. Prime suburbs pay more, because well-located land is sought after. That is as it should be. If we want to occupy prime land, we should pay the rent. If we choose to live in areas with less amenities, we should pay less. That’s fair. Government gets its revenue; citizens get to choose where they live. Bring it on!


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