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Any ideas what (if anything) might happen to WA Stamp Duty

Any ideas what (if anything) might happen to WA Stamp Duty

Old Apr 10th 2007, 2:03 am
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Question Any ideas what (if anything) might happen to WA Stamp Duty

:........and what are your opinions?

This is part of an article by REIWA.

$18,700 tax now applies to a median priced home.

The West Australian State Government has failed to adjust tax rates on conveyencing (the buying and selling of property), for several years.

During this period, Perth has experienced a housing boom and prices have increased significantly. As a consequence stamp duty has jumped hugely as well. The old tax scales are now highly inappropriate for the new price range.

The failure of the government to address this 'bracket creep', means that homebuyers in WA are handing over a huge amount of stamp duty to Treasury coffers.

During 2005/6, more than 80 per cent of homebuyers were pushed into the two top rates of stamp duty. Just eighteen months ago, this represented about 50 per cent of homebuyers.

Stamp duty on property purchases has increased by more than 300 per cent since Labor was elected in 2001, compared with house price growth of 175 per cent.

A Perth homebuyer buying a median priced home will now have to pay more than $18,700 in tax.

Just five years ago, a homebuyer would have paid only $4,720 stamp duty on a median priced home.

State Treasurer Mr Eric Ripper, has said that despite WA's booming economy he will not yet reduce stamp duty on the purchase of a property.

More than 30 per cent of all taxes raised in WA now come from property transactions alone.
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Old Apr 10th 2007, 2:18 am
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Default Re: Any ideas what (if anything) might happen to WA Stamp Duty

Originally Posted by The Jones Family
:........and what are your opinions?

This is part of an article by REIWA.

$18,700 tax now applies to a median priced home.

The West Australian State Government has failed to adjust tax rates on conveyencing (the buying and selling of property), for several years.

During this period, Perth has experienced a housing boom and prices have increased significantly. As a consequence stamp duty has jumped hugely as well. The old tax scales are now highly inappropriate for the new price range.

The failure of the government to address this 'bracket creep', means that homebuyers in WA are handing over a huge amount of stamp duty to Treasury coffers.

During 2005/6, more than 80 per cent of homebuyers were pushed into the two top rates of stamp duty. Just eighteen months ago, this represented about 50 per cent of homebuyers.

Stamp duty on property purchases has increased by more than 300 per cent since Labor was elected in 2001, compared with house price growth of 175 per cent.

A Perth homebuyer buying a median priced home will now have to pay more than $18,700 in tax.

Just five years ago, a homebuyer would have paid only $4,720 stamp duty on a median priced home.

State Treasurer Mr Eric Ripper, has said that despite WA's booming economy he will not yet reduce stamp duty on the purchase of a property.

More than 30 per cent of all taxes raised in WA now come from property transactions alone.
I think they will probably reduce it. By how much, who knows. I wouldn't hold your breath though. They are Socialists, and Socialists love high taxes.
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Old Apr 10th 2007, 2:33 am
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Default Re: Any ideas what (if anything) might happen to WA Stamp Duty

What I have read in the news suggests they will reduce stamp duty on houses but only at the cheaper end of the scale (up to $450K was suggested). It may be they increase the first-time buyers allowance instead. There are reports of many people deferring buying as they are waiting and hoping for good news in May.

Eric Ripper has stated often that he does not intend to have many tax cuts. Even those cuts discussed in the news tend to be around commercial properties and other things that don't impact many of us.

While I would like more $ in the bank I also understand the extreme prudence the govt shows. If and when the boom ends the WA economy is likely to go into freefall (due to being resources-dependent) and then everyone will be thanking him for being mean. I think it is enlightened thinking to use a surge in tax-take to pay off the new railway line in one go rather than having it like a mortgage for decades.
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Old Apr 10th 2007, 3:27 am
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Default Re: Any ideas what (if anything) might happen to WA Stamp Duty

This is something that has already been experienced in NSW. A few years ago the REI here kicked up a similar fuss about the stamp-duty windfall that the state government was getting.

The response from the government was not to vary the rates but to reduce stamp duty for first home buyers only. This kind of makes sense as non-first-home buyers are usually selling first so have reaped a benefit from the rise in prices and are nicely cashed up.

Don't forget that if the stamp duty windfall was cut short the government will only have to make up the shortfall by taxing something else instead.

I don't have the slightest problem with Stamp duty as it's a tax I don't pay (because I'm not buying a house ).
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Old Apr 10th 2007, 4:54 am
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Default Re: Any ideas what (if anything) might happen to WA Stamp Duty

Originally Posted by NickyC
Don't forget that if the stamp duty windfall was cut short the government will only have to make up the shortfall by taxing something else instead.
Not if they are running an annual surplus in excess of $1 billion like in WA they don't!
If government is running a surplus like that then they should either give it back to the taxpayers or spend it. It's not their money after all.
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Old Apr 10th 2007, 5:52 am
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Default Re: Any ideas what (if anything) might happen to WA Stamp Duty

Originally Posted by Amazulu
Not if they are running an annual surplus in excess of $1 billion like in WA they don't!
If government is running a surplus like that then they should either give it back to the taxpayers or spend it. It's not their money after all.
Yes. But all a direct tax-break on Stamp Duty would do is add the equivalent onto the cost of a house, as people would have more to spend and, following the laws of supply and demand, prices would rise accordingly. The only people who would really gain would be REIWA. Hence their agitation for reform.

The Gvmt really do need to address land release before cutting Stamp Duty (and this won't happen as long as they are seemingly using land release as a tool of fiscal policy to generate as much tax earnings as possible. The government motto would appear to be "make hay while the sun shines").

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Old Apr 10th 2007, 6:18 am
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Default Re: Any ideas what (if anything) might happen to WA Stamp Duty

Originally Posted by The Jones Family
:........and what are your opinions?

State Treasurer Mr Eric Ripper, has said that despite WA's booming economy he will not yet reduce stamp duty on the purchase of a property.

More than 30 per cent of all taxes raised in WA now come from property transactions alone. [/COLOR]
But he might lower the minimum threshold
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Old Apr 10th 2007, 1:57 pm
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Default Re: Any ideas what (if anything) might happen to WA Stamp Duty

Cheers for all the replies
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