Stamp duty, not negative gearing holds housing affordability key

Stamp Duty

The Property Council of Australia is continuing to push back against proposals by the Labor Party to alter negative gearing and capital gains tax arrangements.

Following Federal Opposition leader Bill Shorten’s Budget reply speech, the PCA has doubled down on its stance that changes to negative gearing and CGT will not improve housing affordability.

“We refute the idea that placing $32 billion in additional taxes on property through changes to negative gearing and capital gains tax arrangements will lead to an improvement in housing affordability. It won’t,” PCA chief executive officer Ken Morrison said.

“Housing affordability is a huge issue in Australia. Housing affordability needs to change, but it won’t change if you prescribe the wrong solution,” Morrison said.

While it appears there is little chance of it ever being removed, Morrison also repeated calls for stamp duty to be addressed if policy makers are serious about addressing affordability.

Related: Putting an end to stamp duty

“The way to tackle housing affordability is to deal with the weaknesses in supply and to undertake meaningful reform of state taxes,” he said.

“Stamp duty adds $35,000 to the cost of buying a typical home in Sydney and $32,000 to a similar home in Melbourne.

Related: Oversupply of bedrooms

“Australia is crying out for government to deal with housing supply imbalances and to reform state property taxes. Stamp duty is an inefficient tax that slugs householders and is a drag on the economy.”

(Article source)

 

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