Residential housing affordability is under threat in Queensland due to the state government’s stamp duty hikes. According to the Australian Bureau of Statistics (ABS), the government’s take rose by $273m from FY2016 to 2017.
The state government’s coffers received a “plumped up injection” of $3.278bn in stamp duty on conveyances in FY2017, compared to the $3.005bn in FY2016, according to the Real Estate Institute of Queensland (REIQ).
“This increase means more than 25 per cent of the total taxation revenue in Queensland is coming from stamp duty on conveyances,” REIQ said. “When land tax and other taxes on property are added to the equation, more than 38 per cent of the total taxation revenue comes from property-related taxes or the equivalent to about $5 billion in FY2017.”
Meanwhile, stamp duty on conveyances revenue contribution increased from 17% in 2013 to 25% to June 30, 2017.
Stamp duty on conveyances is the second-largest contributor to the Queensland coffers behind the payroll tax, according to REIQ.
Antonia Mercorella, CEO of REIQ, said the state government was taking advantage of the property sector.
“We have good affordability in our residential market and great affordability in our commercial market, but rising stamp duty costs are threatening that affordability,” she said. “In residential real estate, hefty stamp duty costs serve to stifle housing mobility. Upgraders and downsizers put off the next move because of the onerous stamp duty they will have to pay when they move.
“An upgrader moving from a $500,000 home to a $750,000 home would be forced to pay an estimated $20,000 in stamp duty, on top of the cost of their new home, along with various costs associated with buying and selling property.
“The reality is simply that stamp duty is threatening our affordability,” she said. “REIQ has long advocated for the abolition of stamp duty. It does the property sector no favours and the state government is now in danger of killing off the golden goose.”
The full abolition of stamp duty would boost housing affordability for all Queenslanders and encourage more property transactions, REIQ said. The move would also unleash a flurry of economic activity that would positively impact residential real estate.
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