Login
ISCOVER
Brokers have voiced strong opposition to a potential increase in land tax and stamp duty by the cash-strapped NSW government.
Tony Abbott’s tough federal Budget reduced funding to the states and triggered speculation that NSW would respond by increasing land tax and stamp duty in the June 17 state budget.
To continue reading the rest of this article, please log in.
Looking for more benefits? Become a Premium Member.
Create free account to get unlimited news articles and more!
Looking for more benefits? Become a Premium Member.
Enrizen managing director Trent Franklin said an overall increase in property taxes would make people more negative about the market and reduce buying activity.
However, he told The Adviser that he would be willing to support an increase in land tax as long as it was accompanied by an even greater decrease in stamp duty.
That would stimulate the market because it would mean less of an upfront hit even though there would be more payments over time, he said.
Full House Finances director Ian Miller said he would oppose an increase in property taxes because they were already high enough.
He said potential first home buyers were often surprised when they learned how much extra money they needed to cover state taxes.
Mr Miller added that a tax increase might make people rent for longer and then opt for a cheaper investment property for their first purchase.
OzWealth Finance director Enid Mead also opposed a potential increase in stamp duty, because she said first home buyers were already struggling to enter the market.
However, she told The Adviser that she might accept an increase in land tax for richer investors who could afford to pay more.
The Real Estate Institute of NSW has also voiced strong opposition to any rise in property taxes.
“Property consumers, and in particular first home buyers, should not sit back and let this happen,” the institute said.
“For too long the property market has been the state government’s cash cow and property consumers are now saying enough is enough.”
Meanwhile, the Westpac Melbourne Institute Index of Consumer sentiment has fallen from 99.7 in April to 92.9 in May.
The index tracking ‘whether now is a good time to buy a dwelling’ also fell by six per cent and is now at its lowest level since November 2010.
Housing confidence in NSW has now fallen by about 30 per cent since September.
