The McGowan Government must commit to investigating the introduction of a broad based land tax system in WA to replace the current regimes according to the Urban Development Institute of Australia (UDIA WA).
“UDIA’s state budget submission has called for a comprehensive review of State based property taxes including Stamp Duty and Land Tax to ensure that they are fair, effective and efficient,” UDIA WA CEO Allison Hailes said.
“There are significant inefficiencies in the current residential property transfer duty regime which are barriers to housing affordability and mobility and we are calling on the government to take action to ensure our system is more sustainable in the long term,” Ms Hailes said.
“Stamp Duty negatively affects housing affordability and is a significant barrier to Western Australians ability to move to a new home that is more appropriate to their needs, such as retirees wanting to downsize or families’ upsizing,” Ms Hailes said.
“Phasing out Stamp Duty and establishing a broad based land tax system, as they have in place in the ACT, would distribute the tax burden more equitably and provide the state government with a more consistent revenue stream which can be invested into the state’s growth consistently over the term of government,” Ms Hailes said.
“This change would facilitate household mobility, enabling people to move between different homes that are more appropriate to their changing needs,” Ms Hailes said.
A broad based land tax system would apply to all home owners, rather than targeting those that are purchasing a new home.
“We recognise that this change requires leadership and we believe the McGowan Government has shown this on other matters. We are now calling on the government to reform the state’s property taxes to provide long term sustainability of tax revenues,” Ms Hailes said.
“While the government considers this review, there should not be any increases to current stamp duty or land tax rates,” Ms Hailes said.
The UDIA submission also calls for the cancellation of the introduction of a Foreign Owner Duty Surcharge or ‘foreign buyer’s tax’ that is slated for January 2019.
“The WA property market is in the very early stages of recovery and, given foreign investment in the property market is integral to the success of the wider WA economy, we are urging the government to reconsider the imposition of a tax that directly detracts from investment in WA property,” Ms Hailes said.
“It is critical that investment in land and housing remains an attractive proposition,” Ms Hailes said.
“WA’s current lack of a tax surcharge on foreign investment provides WA with a competitive advantage over other states in Australia and to take that away now, will only further hinder much needed investment into this state,” Ms Hailes said.
Ends.
Full UDIA state budget submission here
For more information:
Gemma Osiejak
UDIA WA Executive Manager Communications & Marketing
E: gosiejak@udiawa.com.au
M: 0421 506 819