Federal Housing Minister Clare O’Neil has slammed stamp duty as a “bad tax,” calling for state governments to scrap it to help ease the housing crisis.
The idea was first floated by the Business Council of Australia (BCA) in its detailed report on the crisis It’s Time To Say Yes To Housing released this week.
Business groups have long called for state and territory governments to phase out stamp duty and replace the revenue with an annual land tax.
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The states and territories raised $25.2 billion from stamp duty in 2021-22, according to the most recent Productivity Commission analysis, which was detailed in the report.
The move could save home buyers tens of thousands, with stamp duty often three to 4 per cent of the property value.
In NSW, a $920,000 property purchase would cop an estimated stamp duty of nearly $24,000.
On Wednesday, O’Neil joined Nat Barr and Liberal Senator Jane Hume for Hot Topics on Sunrise, where she was quizzed about the proposed changes to stamp duty.
“Stamp duty is a bad tax as I said yesterday,” O’Neil said.
“It is also squarely a matter for the state governments and I’m really supportive and very much pleased with some of the moves those states and territories have made to try to move away from that tax.
“We’re the Commonwealth government (we) have lot of important parts to play in the housing debate and that’s we you’re seeing our government doing bold and ambitious things, trying to help Australians build more homes.
“(In) Western Sydney where we’re announcing $26 million in investment in pipes and water and roads and other things that are holding up housing, that’s going to unlock hundreds of homes just on this site.
“We’re also trying to help Australians in their rental condition, and we want Australians to build more homes.
“We’ve got a generation of young people in our country who are facing fundamentally different housing options than their parents and grandparents and we’ve got to pull together and do something about it.”
Hume agreed with scrapping stamp duty in principle and took aim at the NSW Labor Government, which is overturning the option of new homeowners to pay stamp duty or land tax.
“I think state Labor governments have been proven to be irresponsible in this regard, pushing up both stamp duty and land tax, so this might be wishful thinking from Clare’s point of view.
“Most importantly, stamp duty is a demand-side lever and we need to pull the supply-side levers to open up new land developments.
“That’s why the Coalition government have announced a $5 billion fund to do exactly that, to build that enabling infrastructure in those new housing developments to unlock half a million new homes.”