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The Queensland government should “urgently review” its stamp duty exemption threshold for FHBs, according to the managing director of Borro.
The managing director of Brisbane-based brokerage Borro, Cara Giovinazzo, has called on the Queensland government to increase its stamp duty exemption threshold for first home buyers (FHBs).
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The Queensland state government currently has a stamp duty exemption threshold of $500,000 for FHBs, which Giovinazzo said has not increased in more than 15 years. The managing director said that the government “needs to urgently review” the tax exemption threshold considering the medium house price in Brisbane now exceeds $800,000.
The concession should be “increased substantially”, according to Giovinazzo, supporting recommendations from the Real Estate Institute of Queensland (REIQ) to increase the threshold to at least $750,000 for FHBs.
The call for an increase in Queensland’s stamp duty exemption threshold comes following research from the Property Council of Australia (PCA) that revealed that government taxes, fees, and charges make up 32 per cent of the total cost of a new home in the state.
The council’s research similarly found that taxes, fees, and charges (including stamp duty) made up 33.3 per cent of costs for a new apartment in the state.
The Property Council revealed that a $730,000 mortgage in Queensland would incur $233,440 in taxes, fees, and charges.
Jess Caire, PCA Queensland’s executive director, said that the statistics were “alarming” and demonstrated how Queensland’s government taxes were directly impacting housing affordability.
Giovinazzo said: “I have been in the lending sector almost 15 years and over that time there has never been an increase in the stamp duty threshold for first-time buyers, who are now being priced out of the market because they don’t even qualify for the concession.”
Stamp duty accounts for 25 per cent of the tax base for the Queensland government, which is an increase of 5 percentage points compared to a decade ago.
Borro’s managing director said that the Queensland government had reported more revenue from stamp duty than was expected: “The state government has been having a feast from stamp duty revenue with recent reports the tax has raised $3.5 billion more than forecast in the last state budget.”
Speaking on the impact of stamp duty on buyers, Giovinazzo said: “Queensland currently has the lowest proportion of first home buyers of all mainland states. Stamp duty is an inefficient and aggressive tax which can add years to the time people looking to enter the property market can take to raise a deposit for their first home.
“It’s a financial curse which keeps those wanting to own their home in the rental market and deters empty-nesters who may be considering downsizing from selling due to the cost.
“At a time when the nation is experiencing a serious housing crisis, it’s a disgrace when a government is a barrier to home ownership.”
[Related: Qld state taxes impact home affordability: Property Council]
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