NSW Stamp Duty
Announced as part of the NSW Budget 2020-21, the state government is to launch a public consultation to seek the community's view on tax reform to reduce the upfront costs for buyers and remove "one of the biggest financial barriers to home ownership".
The proposed model would give buyers a choice to axe stamp duty at the point of purchase and choose an annual property charge instead.
The consultation process outlines a proposed model that would:
- Give people purchasing a property the choice between paying stamp duty upfront or opting for the smaller annual property tax;
- Enable people who opt-in to the system to also eliminate any land tax liability;
- Ensure that the current property owners who are not buying or selling are not affected;
- Replace the current stamp duty concessions provided to first home buyers with a new grant; and
- The proposed model includes a property tax rate that would support and incentivise homeownership with a lower rate for owner-occupiers and higher rates for investors and commercial properties.
The reform could be set in motion in the second half of 2021 after seeking community feedback over the coming months.
Source: The Adviser