Stamp duty is one the oldest taxes and removing it could boost home ownership
Economic research suggests that replacing stamp duty with a land value tax could significantly boost home ownership rates and improve economic efficiency in Australia. Experts argue that stamp duty acts as a barrier to property transactions, whereas a land value tax provides a more stable and neutral revenue stream for governments.
Why it matters
Housing affordability is a major political and economic issue, and tax reform is frequently proposed as a mechanism to address market stagnation.
Researchers have estimated removing stamp duty could increase home purchases by about 100,000 in NSW each year. ( ABC News: Steve Keen )
Link copied Share Share article Whether it is bidding at an auction or buying at a private sale, most people purchasing property in Australia will pay one of the world's oldest taxes, stamp duty.
But research suggests shifting away from the more than 300-year-old tax on property transactions could ease housing affordability and help boost economic activity.
Across the country, all jurisdictions have stamp duty, with only the ACT planning to phase the tax out over a 20-year period.
e61 Institute economist Nick Garvin said stamp duty was not a neutral tax because it dis-incentivised people from moving.
"An ideal tax is one that is neutral in the incentives that it generates. So basically it doesn't change people's behaviour," Dr Garvin said.
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