CCIWA Chief Economist
The Chamber of Commerce and Industry WA (CCIWA) today releases ‘Stamping out stamp duty’ – a nationally significant report making a powerful case to reform one of the most economically damaging taxes. Underpinned by modelling conducted by the Australian National University’s Centre for Social Research and Methods, the report clarifies a highly practical option for economic reform.
For the first time, this report establishes that reform would improve not just economic efficiency, but also fairness. Lower income households are punished the most by the tax on property transfers, and would benefit the most from reform. The ANU’s model shows the lowest-income households allocate double the proportion of their income to property taxes (5.5%) compared to top-earners (~2%). Making up 20 percent of the upfront cost of moving, stamp duty is an unfair barrier to Australians finding their most suitable and affordable home.
Reform would ease the unfairly distributed costs, reduce commute times and strain upon infrastructure, and improve affordability and choice for the workforce. It would also support the efforts of regional communities to attract workers.
Critically, our report presents comprehensive options to resolve political and financial barriers to reform, including a staged opt-in approach. Reform is unlikely to be achieved without Federal Government support.
As world economies emerge from COVID-19, Australia faces ever-fiercer competition for global skills and investment. Reform would improve labour mobility, competitiveness and facilitate the regeneration of town centres and cities.
CCIWA’s ‘Stamping out stamp duty’ report builds upon widespread expert support, by the Henry Tax Review, ACOSS, St Vincent de Paul, UDIA, the OECD, the IMF and the Productivity Commission.
With state and federal treasurers set to meet tomorrow, today’s release provides a compelling case to commence reform of an unfair, inefficient and regressive tax which holds Australia’s economy, community and businesses back. CCIWA recognises that there are short to mid-term impacts that make the change difficult, but the long-term dividends are compelling. All major reform has its challenges and this is the right step forward for our nation.
Read the full CCIWA Stamp Duty Reform report here