The Real Estate Institute of Australia (REIA) has praised a report which calls for the abolition of Stamp Duty.
The report, which used modelling by the Australian National University, found that stamp duty reform would improve both economic efficiency and fairness.
It says lower-income households are the most significantly affected by stamp duty, as it accounts for about 5.5% of their income.
The report says stamp duty accounts for 20% of the upfront costs of moving and is a financial barrier to many Australians buying a home.
It calls for reforms to more evenly distribute costs.
REIA, President Hayden Groves, says the Chamber of Commerce and Industry of Western Australia report confirms what the industry has been saying for some time – that stamp duty must go.
He says the removal of stamp duty could help increase property listings and housing supply by up to 50%, which would have a big impact on affordability.
“Australians are being left behind and held back by stamp duty and it is time for action,” he says.
The report suggests a number of options for reforming stamp duty:
- A system which allows buyers to have a choice when purchasing a property to pay stamp duty tax or to incur an annual property tax.
- Replace stamp duty with higher council rates.
- Abolish stamp duty and introduce a property levy applied to a property’s gross rental value.
- Introduce a property levy when title changes.