Council calls for property reform
Buying a property comes with a wide range of fees and taxes, depending on where you buy and the people you engage to help you through the process. Some of the biggest imposts on purchasing a home can be stamp duty, and there have recently been calls for this to be changed in new South Wales.
In a recent press release, the Property Council of Australia (PCA) NSW Executive Director Glenn Byres noted the continued contribution that NSW housing makes to the state economy. He stated that the property industry employs creates 10 per cent of all new jobs in the state, is responsible for more than one third of NSW tax revenue and also pays more than $16 billion in employee wages.
"There is no doubt a mood of optimism in the market right now and home approvals are at their highest for a decade," Mr Byres added.
"But we need to be wary of the continued dependence on stamp duty."
While there are exemptions and subsidies on stamp duty in the state for first home buyers, the tax is paid on most property transactions. But the PCA thinks as times change, with the NSW budget recently being released, there needs to be action taken to reduce stamp duty barriers between buyers and homes.
"Abolition of stamp duty needs to be front-and-centre in any assessment of tax reform options as it is volatile, inefficient and crimps productivity" concluded Mr Byres.
Pushing for policy reform
This sentiment is shared by the Housing Industry Association (HIA), who called for policy reform around the taxes on the property industry recently.
In a response to the Reserve Bank of Australia keeping the cash rate steady, HIA Chief Economist Harley Dale bemoaned the number of home buyers who were currently being shut out of the real estate market.
"There is a lack of titled residential land, excessive planning delays and restrictions, and a plethora of taxes and charges which combine to make new housing one of the most heavily taxed sectors of the Australian economy," he said earlier this month.
He also believes that by failing to change policies on taxation of property, housing supply growth is being hampered. While this is currently at strong historical levels, changes to allow more people into residential and commercial property could see even better results for the NSW economy.