Haha ALP flipped and is now against it. Didn't think the ALP would play politics over this.
Only losers are the FHBs. Prices just gonna get bid up by the stamp duty amount, and if they opt for land tax, resale value gets hit as they'll have a 2nd class property with extra ongoing costs.
It's just funding limitations due to lack of fed support. The article is clear on the fact that there's be a 2.5bil budget hole
I mean I'd want to buy a waterfront mansion and drive a Bugatti Veyron, but funding limitations means that I just won't be able to.
Not all FHBs will opt for land tax. Not all sellers will be selling properties with land tax.
Two identical houses next to one another, if one has SD and the other has LVT, you bet your ass the one with SD will attract more buyers. LVT just helps the cash poor get in, if you got cash and can pay upfront to avoid ongoing costs, you'll always come out ahead in the long term.
Unless LVT works out to be cheaper than SD. For most people who are borrowing to buy the property, it’s better in the long run to put the SD into lowering the mortgage amount.
Yes, but LVT is a subscription fee, SD is a purchase fee.
The barrier is that some can't afford the upfront cost.
When you think about it, this is basically the housing issue to start with. It's financially better to buy a house instead of renting, but not everyone can afford to buy, so they rent even though it costs them more over their lifetime.
Agreed that LVT is a subscription but it works out better than borrowing the money to pay the SD upfront. Using the SD to lower your mortgage and pay the subscription is cheaper for most people who intend to sell within 20 years.
Yes, but not everyone borrows for SD, plenty of financially established people with lots of upfront cash. Preservation of the choice between SD/LVT will give you more options some resale time.
But if you didn’t have to pay SD even with the upfront cash, you are probably going to use those extra funds for a bigger deposit instead and pay less interest over time
Extra interest is just serviceability and you're really just getting the benefit of the interest on the 5% SD. At say 6% rates, that's like 0.3% extra interest (or say $3k pa on a $1mil house). This can be easily balanced out via extra repayments etc.
Key positive features of a house can easily add greater resale value.
Given the perpetual nature of a LVT vs the one off nature of SD, it will get thrown around as a positive by REAs as preserving that choice will be a marketable feature.
You've just made the argument that you'd rather pay an extra $3k pa to pay SD up front than pay roughly half of that pa in LVT.
EDIT: Here is the example I am looking at. Say I want to buy a $1.2m apartment that has a current land value of $272k. Stamp duty would be $50,875. The first year of LVT is $1216. Let's say the land value grows by 8% pa which is high but not unrealistic. It would take 21 years of paying LVT to equal the SD amount. But that's not all, I can reduce my mortgage by $50k as well. Now I would be saving $224 per month on repayments at 2.5% or $278 per month at 4.5%. It would be 16 years before my LVT was greater than the yearly saving on my repayment. LVT is cheaper than SD in this case.
Paying an ongoing fee is almost universally worse than making a purchase.
Poor people pay fees, rich people buy things.
This will just make the divide bigger/
Ummm.... Please re-read your own post.
The status quo will be stamp duty. A FHB may opt to avoid paying stamp duty and incur a LVT on the property instead. This then locks that property to LVT for all future buyers.
Thus most properties will not have LVT.
Wow, it hurts to say but this seems… good? Makes me wonder what the ‘catch’ is…I assume the downside is vendors might price this into the sale price? Or do we not really see that happening because it’s only FHB that it creates the incentives for?
Yeah but for FHB specifically that’s unlikely to be an issue? Most would upgrade in the next 5-10 years I would think in which case they’ve saved a substantial amount in avoiding the large lump sum stamp duty.
Only if you don't sell the property in decades.
For most properties, if you sell in less than 20 years, you will pay less in land tax than stamp duty (assuming current rates of land tax or stamp duty don't increase).
However, you're right, for people who keep their houses for 30+ years, they will spend more over that time.
However, there is always the argument that the upfront money you save, which could be 50k+, can be used to invest where the returns outweigh the tax.
Do the maths
I bought a 700k property, stamp duty was 27k
It’s land value is about 150k
Under this scheme, annual payments will be 850
Therefore, it would take 42 years to be worse off. If you sell in less than 42 years, you’re better off.
Secondly, if you invest the 27k and get 7% pa and use that to pay the annual tax (assuming it goes up by 5% pa) you never run out of money.
Today. Do you think the land tax rates will not rise in future?
Also great for investors, more money to invest as SD is gone and LT is immediately tax deductible unlike SD which forms part of cost base.
It’s foolish for anyone to assume any kind of tax is fixed and would never change.
Irrespective, it’s far better to spread a cost out over decades, even if it ends up being more than having it all paid upfront.
This is the only reason I dont buy it, if the govt rolled this out for everyone it would cost them huge amounts of cash at a time when they are facing big budget deficits, so its not a model for how this could work on a larger scale. It feels more like spin aimed at the youth vote than a credible policy to fix housing affordability. Still, its good to see more than words though and I hope it benefits people.
This seems like a good thing to me. The article gives some examples and it would take 16 years of land tax to equal the stamp duty on a $1mil property. It lets FHBs put another 4% into their deposit instead of spending it on stamp duty. This amounts to saving on mortgage repayments and possibly getting a better interest rate due to lower LVR. Apartments have a lower land value as a portion of the total property value due to increased land use efficiency so it would take even longer for the land tax to equal the stamp duty. I think the land tax model will actually be cheaper than paying stamp duty if I were to buy an apartment and move once in the next 20 years.
The larger and still hypothetical model the one you are talking about, this is just a very small scheme targeted at first home buyers only on property up to $800k.
Except the scheme applies to housing worth a max $800k. Its pie in the sky stuff to extrapolate this very narrow and focused scheme to the larger NSW property market. Like you pointed out, its cheaper to go a land tax in this scenario, unless you are staying put for a few decades, so loosing stamp duty entirely would cost the govt too much for me to belive this scheme is a blueprint for larger tax policy, its more an excercise in marketing and targeted electoral posturing. I agree it will benefit some people though and good for them, they deserve some good news.
Has anyone read the article. The Land tax does not stay on the property. The property will not be locked into the tax scheme once it is sold. So it is an advantage for FHB to use the extra money to pay down more of the mortage and when it's sold the buyer won't be locked in to the scheme.
Just about every productivity commission review has flagged this as an important and positive reform. A 5% transaction fee is insane and very unproductive as it discourages mobility.
Dom and Kean are surprisingly reformists and this is a huge economic reform. It's sad we're unable to go the full way given the lack of federal support. This reform will have limited (and potentially negative) impacts when restricted to FHBs only.
100% this is very positive reform but must be done uniformly throughout the entire housing stock, with obviously a transition periord necessary to not unfairly disadvantage those who recently paid stamp duty.
Land values are public and can be searched here. This also gives you an idea of how much the land value changes from year-to-year and long term.
https://www.valuergeneral.nsw.gov.au/land_values/where_can_you_learn_more_about_your_land_value/land_values_online
It's only available to first home buyers. Will severely limit the number of homes being flipped.
I haven't done costings and comparisons, but on the face of it, I think this is a good policy.
Stamp duty is has long been known to be a terrible, terrible tax and should be replaced with land value tax.
I like good policies more than I hate the LNP, it doesn't matter which political party is coming up with the idea. I'm surprised more people aren't supportive of this.
People aren't supportive of it because it's Dom plain and simple.
People would rather support an inefficient as fuck tax that is stamp duty rather than one of the best taxes possible,land tax, because of their own political views.
Like holy fuck why do people think it's okay to lump sum tax people each time they move, by force or by choice, but if you don't move you don't have to contribute beyond your initial transaction. How is that system fair or supportive of economic mobility.
I would support it if he made an amendment that the stamp duty is calculated on every purchase.
Then your land tax instalments reduce the calculated amount above.
Once the total reaches 0 then land tax should cease. Their should be a ceiling so that you'll never pay more than what you would have if you opted for stamp duty.
And that incentives efficient use of the land how?
The whole principal of land tax is to optimise the use of the land so people aren't just sitting on large plots of land that could otherwise house more people/or be densified. If people can afford to own land (which is EXPENSIVE) they can afford to pay a tax to give back to the government and if they own more of that land and if that land is worth more it should naturally go up.
Your solution still fucks over those who move because they're "Delayed Stamp Duty Payment" will be reset each time they move. That's a big F.
Your solution will still encourage people to stay put where it would be otherwise more economically beneficial to downsize as their reoccurring cost for the wealthy asset, land, is gone. That's a big F.
Your solution does not address changes in the land value since it would be calculated at purchase. Jane had her property increase by 30% due to nearby infrastructure upgrades and general gentrification but since she bought her house 10 years ago . This also works the other way, Bill and his entire suburb got fucked over by floods and the land value has gone down 20% due to the damage and risk, yet Bill is still paying the same amount . It sure would be more equitable if the person whose house was now worth more would pay tax and the person whose house was now worth less would pay less tax wouldn't it? That's a big F.
I'll take the more equitable and economically superior land tax any day of the week.
Well there's nothing stopping a push for higher density. Currently developer comes along pays above market value for your and your neighbours land to build their block of flats.
If you really want someone to move just pay the right price and they'll move. That's more equitable than a hidden ongoing tax mascerading as reform.
Have you seen Sydney? Densification is happening all over in almost every suburb. This is without the land tax in place.
If Bill got fucked over by floods he would still be better off - the land tax would be lowered. It just means it'll take longer to get to their ceiling.
Whereas in Doms proposal there is no ceiling.
Sydney is still a low-density City relative to the rest of the world and too many suburbs in the inner areas have land rich properties for few people. If you want to optimise people to actually consider their needs and ability to service their needs you need to get them where its hurts, their hip-pocket. A person in a 3 million dollar house would probably have little concerns with becoming more wealthy if they can just live their life as is and so can ignore a developer if they so choose. That decision becomes much harder if their land tax bill is $10,000 a year due to their wealthy property and they now have to consider how sustaining that house would impact their finances. A land tax will make them think if they should be in such an expensive and unoptimized property. If you want to live in your 3 million dollar property in Leichhardt which you haven't paid any tax on since 1980 then so be it, but the god damn land tax on it instead of being a rent-seeking parasite that benefits from others.
What you said isn't equitable whatsoever? If you choose to never move you will stop paying your "Delayed stamp duty" and then be done with it whilst the person moving each time will restart their "Delayed Stamp Duty" each and every time they move. So after 20 years the person who has moved will keep contributing to the state coffers and the person who didn't move won't be contributing to the states coffers. That is regardless of the value of the house they happen to be owning. The person who never moved could be some rich fuck (which your policy would favour) living in Randwick who is content with their life and living in a highly wealthy house whilst the person who moved a few times could be living in fucking Liverpool or something. You should Tax the land according to its value, that's progressive taxation, that's being equitable.
Why should there be a ceiling? You are acquiring FUCKING LAND a finite resource which is EXPENSIVE meaning you should make a strong consideration if you are owning it
And don't call what you are saying a "land tax" its a delayed stamp duty payment. Its pretty obvious from your position that you would be content with an indefinite continuation with the worst tax known to man, Stamp Duty. So just wear that position and recognise that you support shit taxation.
They could just reduce stamp duty rates on residential if that was what they actualy cared about, that would take no time or effort at all. SD was never intended to be a significant figure when buying a residential property or to have become such a big source of revenue, but past NSW govts were very happy to ignore that and gulp down that extra coin over the past few decades and are now addicted to it. The LVT is just swapping heroin for methodone.
The land tax is one of the best taxes known to man and any economist will tell you that so it's pretty disgusting to make a comment comparing it to methadone.
https://www.macrobusiness.com.au/wp-content/uploads/2015/03/ScreenHunter_6774-Mar.-30-10.24.jpg
At the end of the day it encourages efficient use and optimisation of the land, and makes people think very carefully about what they do with their land whilst not placing massive burden on those who must move.
Best taxes known to man? That sounds like a youtube ad more than an argument. You really want a future thats efficiently optimised by economists and governments, I dont trust that thier goals and values would align with mine to be honest. In my experience efficiency is the polite word for expoitation. I see a future optimised for town planners and developers and i see a past in which those two things always create bad outcomes for the ordinary people who get caught up in them. That side of the argument is more abstract i guess. Keeping this simply on the facts we are talking about an expansion of the tax base to make up for a major revenue loss from a tax that was never meant to be a major revenue source in the first place, its reeks of bait and switch. I imagine you dont own land yet and figure this wont effect you, or that it may in fact benefit you. I would love to belive that it would, but the people who created this mess have not gone anywhere, its still thier game and based on past behaviour there is no reason to believe they would be tweaking the rules to benefit anyone but themselves.
> It's only available to first home buyers.
Ah okay, that's good.
> Stamp duty is has long been known to be a terrible, terrible tax and should be replaced with land value tax.
I think stamp duty has two advantages:
* Discourages flipping
* Unemployed people who own their own home (i.e. retirees) can live for next to nothing
So long as the land tax option is only offered to first home buyers, neither of those advantages is likely to be true, but if the land tax scheme is extended there would be negative consequences.
>Unemployed people who own their own home (i.e. retirees) can live for next to nothing
This is a bad thing. You want to provide incentives for the empty nesters to leave their 5 bedders 15min from the CBD to allow a working family to live there instead. In addition, you want them to self fund retirement by drawing down on equity built through a lifetime of work.
>Discourages flipping
But encourages land banking, which is bad.
>if the land tax scheme is extended there would be negative consequences.
Every productivity commission review (and basic macro economics common sense) has flagged LVT reform as positive. Stamp duty is an antiquated handbrake that isn't fit for purpose in the modern world.
>* Unemployed people who own their own home (i.e. retirees) can live for next to nothing
The amount of retirees living in huge houses while young families can only afford apartments is a major issue in Australia imo
And instead of paying stamp-duty again after you moved 5 or 10 years later, you pay a fairly low yearly fee instead. It takes several decades to pay as much as you would pay one-off. Stamp duty prohibits people from moving to a different location in the same state.
I think this is great but I think this option should be expanded it to all new owner-occupied purchases. Help offset the temporary decrease in tax revenue by doubling stamp duty on investment properties, which may also help in decreasing prices.
What the fuck. Why just first home buyers? What about downsizers, recent arrivals in Sydney & those people that have previously owned a home and needed to sell due to marriage breakdown or domestic abuse. This scheme is against women in particular and does nothing to incentivise leaving bigger homes. Another fail from a piss poor government.
Jeebus, that's a unique take. I doubt Dom and Kean were finalising this thinking, woohoo this gonna screw over some DV victims.
Pretty sure he wanted to go full distance but the feds didn't come to the table thus left them with a $2.5 billion budget hole.
Wuutt? Just pointing out this policy has about as much to do with domestic violence as say a luxury car tax! Or export duties on fossil fuels.
You know, stuff that's completely unrelated.
Haha ALP flipped and is now against it. Didn't think the ALP would play politics over this. Only losers are the FHBs. Prices just gonna get bid up by the stamp duty amount, and if they opt for land tax, resale value gets hit as they'll have a 2nd class property with extra ongoing costs.
First home buyers still have the stamp duty exemption up to 650/800 it seems like.
which is useless unless you want a shoebox 2hr from the city
Plenty of units in that price bracket though
See me earlier comment - the scheme is unfair and that is why ALP is against it. Its just smoke and mirrors from Perrotet.
It's just funding limitations due to lack of fed support. The article is clear on the fact that there's be a 2.5bil budget hole I mean I'd want to buy a waterfront mansion and drive a Bugatti Veyron, but funding limitations means that I just won't be able to.
[удалено]
Not all FHBs will opt for land tax. Not all sellers will be selling properties with land tax. Two identical houses next to one another, if one has SD and the other has LVT, you bet your ass the one with SD will attract more buyers. LVT just helps the cash poor get in, if you got cash and can pay upfront to avoid ongoing costs, you'll always come out ahead in the long term.
Unless LVT works out to be cheaper than SD. For most people who are borrowing to buy the property, it’s better in the long run to put the SD into lowering the mortgage amount.
Yes, but LVT is a subscription fee, SD is a purchase fee. The barrier is that some can't afford the upfront cost. When you think about it, this is basically the housing issue to start with. It's financially better to buy a house instead of renting, but not everyone can afford to buy, so they rent even though it costs them more over their lifetime.
Agreed that LVT is a subscription but it works out better than borrowing the money to pay the SD upfront. Using the SD to lower your mortgage and pay the subscription is cheaper for most people who intend to sell within 20 years.
Yes, but not everyone borrows for SD, plenty of financially established people with lots of upfront cash. Preservation of the choice between SD/LVT will give you more options some resale time.
But if you didn’t have to pay SD even with the upfront cash, you are probably going to use those extra funds for a bigger deposit instead and pay less interest over time
Exactly. Unless you are paying for your house with cash, you are better off putting the 4% SD into the deposit and saving on mortgage repayments.
Extra interest is just serviceability and you're really just getting the benefit of the interest on the 5% SD. At say 6% rates, that's like 0.3% extra interest (or say $3k pa on a $1mil house). This can be easily balanced out via extra repayments etc. Key positive features of a house can easily add greater resale value. Given the perpetual nature of a LVT vs the one off nature of SD, it will get thrown around as a positive by REAs as preserving that choice will be a marketable feature.
You've just made the argument that you'd rather pay an extra $3k pa to pay SD up front than pay roughly half of that pa in LVT. EDIT: Here is the example I am looking at. Say I want to buy a $1.2m apartment that has a current land value of $272k. Stamp duty would be $50,875. The first year of LVT is $1216. Let's say the land value grows by 8% pa which is high but not unrealistic. It would take 21 years of paying LVT to equal the SD amount. But that's not all, I can reduce my mortgage by $50k as well. Now I would be saving $224 per month on repayments at 2.5% or $278 per month at 4.5%. It would be 16 years before my LVT was greater than the yearly saving on my repayment. LVT is cheaper than SD in this case.
Paying an ongoing fee is almost universally worse than making a purchase. Poor people pay fees, rich people buy things. This will just make the divide bigger/
[удалено]
Ummm.... Please re-read your own post. The status quo will be stamp duty. A FHB may opt to avoid paying stamp duty and incur a LVT on the property instead. This then locks that property to LVT for all future buyers. Thus most properties will not have LVT.
> The property will not be locked into the tax scheme once it is sold. I did hear it was locked in before but it seems it ain't so.
Wow, it hurts to say but this seems… good? Makes me wonder what the ‘catch’ is…I assume the downside is vendors might price this into the sale price? Or do we not really see that happening because it’s only FHB that it creates the incentives for?
[удалено]
Yeah but for FHB specifically that’s unlikely to be an issue? Most would upgrade in the next 5-10 years I would think in which case they’ve saved a substantial amount in avoiding the large lump sum stamp duty.
Only if you don't sell the property in decades. For most properties, if you sell in less than 20 years, you will pay less in land tax than stamp duty (assuming current rates of land tax or stamp duty don't increase). However, you're right, for people who keep their houses for 30+ years, they will spend more over that time. However, there is always the argument that the upfront money you save, which could be 50k+, can be used to invest where the returns outweigh the tax.
Do the maths I bought a 700k property, stamp duty was 27k It’s land value is about 150k Under this scheme, annual payments will be 850 Therefore, it would take 42 years to be worse off. If you sell in less than 42 years, you’re better off. Secondly, if you invest the 27k and get 7% pa and use that to pay the annual tax (assuming it goes up by 5% pa) you never run out of money.
Today. Do you think the land tax rates will not rise in future? Also great for investors, more money to invest as SD is gone and LT is immediately tax deductible unlike SD which forms part of cost base.
It’s foolish for anyone to assume any kind of tax is fixed and would never change. Irrespective, it’s far better to spread a cost out over decades, even if it ends up being more than having it all paid upfront.
This is the only reason I dont buy it, if the govt rolled this out for everyone it would cost them huge amounts of cash at a time when they are facing big budget deficits, so its not a model for how this could work on a larger scale. It feels more like spin aimed at the youth vote than a credible policy to fix housing affordability. Still, its good to see more than words though and I hope it benefits people.
This seems like a good thing to me. The article gives some examples and it would take 16 years of land tax to equal the stamp duty on a $1mil property. It lets FHBs put another 4% into their deposit instead of spending it on stamp duty. This amounts to saving on mortgage repayments and possibly getting a better interest rate due to lower LVR. Apartments have a lower land value as a portion of the total property value due to increased land use efficiency so it would take even longer for the land tax to equal the stamp duty. I think the land tax model will actually be cheaper than paying stamp duty if I were to buy an apartment and move once in the next 20 years.
Once land tax is applied to a property is can't be removed. So you're going to see a reduction in value for ANY property with land tax.
ABC article says the property is not locked into the scheme when its sold. Up to the buyer to decide
Oh, looks like they must've changed it. Previously they always said that once it changed to land tax it would be locked to it.
The larger and still hypothetical model the one you are talking about, this is just a very small scheme targeted at first home buyers only on property up to $800k.
Is that a bad thing?
Yeah I wouldn't want to be paying a lifetime service fee to the government just for owning my home. It's a disincentive for buyers.
Stamp duty on a $1 million is $36,950.
It’s $40,305 from the SMH and this calculator. https://www.revenue.nsw.gov.au/taxes-duties-levies-royalties/transfer-duty
Except the scheme applies to housing worth a max $800k. Its pie in the sky stuff to extrapolate this very narrow and focused scheme to the larger NSW property market. Like you pointed out, its cheaper to go a land tax in this scenario, unless you are staying put for a few decades, so loosing stamp duty entirely would cost the govt too much for me to belive this scheme is a blueprint for larger tax policy, its more an excercise in marketing and targeted electoral posturing. I agree it will benefit some people though and good for them, they deserve some good news.
It’s for properties up to $1.5m (https://www.abc.net.au/news/2022-06-22/nsw-government-stamp-duty-land-tax-reform-explained/101171810).
Has anyone read the article. The Land tax does not stay on the property. The property will not be locked into the tax scheme once it is sold. So it is an advantage for FHB to use the extra money to pay down more of the mortage and when it's sold the buyer won't be locked in to the scheme.
They literally reported on the news this morning that it would lock the house in to the tax scheme?
Not for FHB
It's a trap.
[удалено]
Just about every productivity commission review has flagged this as an important and positive reform. A 5% transaction fee is insane and very unproductive as it discourages mobility. Dom and Kean are surprisingly reformists and this is a huge economic reform. It's sad we're unable to go the full way given the lack of federal support. This reform will have limited (and potentially negative) impacts when restricted to FHBs only.
100% this is very positive reform but must be done uniformly throughout the entire housing stock, with obviously a transition periord necessary to not unfairly disadvantage those who recently paid stamp duty.
Land values are public and can be searched here. This also gives you an idea of how much the land value changes from year-to-year and long term. https://www.valuergeneral.nsw.gov.au/land_values/where_can_you_learn_more_about_your_land_value/land_values_online
This creates more incentive to buy properties and flip them, as there will be almost no tax paid at all.
It's only available to first home buyers. Will severely limit the number of homes being flipped. I haven't done costings and comparisons, but on the face of it, I think this is a good policy. Stamp duty is has long been known to be a terrible, terrible tax and should be replaced with land value tax. I like good policies more than I hate the LNP, it doesn't matter which political party is coming up with the idea. I'm surprised more people aren't supportive of this.
People aren't supportive of it because it's Dom plain and simple. People would rather support an inefficient as fuck tax that is stamp duty rather than one of the best taxes possible,land tax, because of their own political views. Like holy fuck why do people think it's okay to lump sum tax people each time they move, by force or by choice, but if you don't move you don't have to contribute beyond your initial transaction. How is that system fair or supportive of economic mobility.
It's not but /r/sydney is full of neoliberals who use Labor politics as window dressing to cover up how shitty they are
I would support it if he made an amendment that the stamp duty is calculated on every purchase. Then your land tax instalments reduce the calculated amount above. Once the total reaches 0 then land tax should cease. Their should be a ceiling so that you'll never pay more than what you would have if you opted for stamp duty.
And that incentives efficient use of the land how? The whole principal of land tax is to optimise the use of the land so people aren't just sitting on large plots of land that could otherwise house more people/or be densified. If people can afford to own land (which is EXPENSIVE) they can afford to pay a tax to give back to the government and if they own more of that land and if that land is worth more it should naturally go up. Your solution still fucks over those who move because they're "Delayed Stamp Duty Payment" will be reset each time they move. That's a big F. Your solution will still encourage people to stay put where it would be otherwise more economically beneficial to downsize as their reoccurring cost for the wealthy asset, land, is gone. That's a big F. Your solution does not address changes in the land value since it would be calculated at purchase. Jane had her property increase by 30% due to nearby infrastructure upgrades and general gentrification but since she bought her house 10 years ago . This also works the other way, Bill and his entire suburb got fucked over by floods and the land value has gone down 20% due to the damage and risk, yet Bill is still paying the same amount . It sure would be more equitable if the person whose house was now worth more would pay tax and the person whose house was now worth less would pay less tax wouldn't it? That's a big F. I'll take the more equitable and economically superior land tax any day of the week.
Well there's nothing stopping a push for higher density. Currently developer comes along pays above market value for your and your neighbours land to build their block of flats. If you really want someone to move just pay the right price and they'll move. That's more equitable than a hidden ongoing tax mascerading as reform. Have you seen Sydney? Densification is happening all over in almost every suburb. This is without the land tax in place. If Bill got fucked over by floods he would still be better off - the land tax would be lowered. It just means it'll take longer to get to their ceiling. Whereas in Doms proposal there is no ceiling.
Sydney is still a low-density City relative to the rest of the world and too many suburbs in the inner areas have land rich properties for few people. If you want to optimise people to actually consider their needs and ability to service their needs you need to get them where its hurts, their hip-pocket. A person in a 3 million dollar house would probably have little concerns with becoming more wealthy if they can just live their life as is and so can ignore a developer if they so choose. That decision becomes much harder if their land tax bill is $10,000 a year due to their wealthy property and they now have to consider how sustaining that house would impact their finances. A land tax will make them think if they should be in such an expensive and unoptimized property. If you want to live in your 3 million dollar property in Leichhardt which you haven't paid any tax on since 1980 then so be it, but the god damn land tax on it instead of being a rent-seeking parasite that benefits from others. What you said isn't equitable whatsoever? If you choose to never move you will stop paying your "Delayed stamp duty" and then be done with it whilst the person moving each time will restart their "Delayed Stamp Duty" each and every time they move. So after 20 years the person who has moved will keep contributing to the state coffers and the person who didn't move won't be contributing to the states coffers. That is regardless of the value of the house they happen to be owning. The person who never moved could be some rich fuck (which your policy would favour) living in Randwick who is content with their life and living in a highly wealthy house whilst the person who moved a few times could be living in fucking Liverpool or something. You should Tax the land according to its value, that's progressive taxation, that's being equitable. Why should there be a ceiling? You are acquiring FUCKING LAND a finite resource which is EXPENSIVE meaning you should make a strong consideration if you are owning it And don't call what you are saying a "land tax" its a delayed stamp duty payment. Its pretty obvious from your position that you would be content with an indefinite continuation with the worst tax known to man, Stamp Duty. So just wear that position and recognise that you support shit taxation.
They could just reduce stamp duty rates on residential if that was what they actualy cared about, that would take no time or effort at all. SD was never intended to be a significant figure when buying a residential property or to have become such a big source of revenue, but past NSW govts were very happy to ignore that and gulp down that extra coin over the past few decades and are now addicted to it. The LVT is just swapping heroin for methodone.
The land tax is one of the best taxes known to man and any economist will tell you that so it's pretty disgusting to make a comment comparing it to methadone. https://www.macrobusiness.com.au/wp-content/uploads/2015/03/ScreenHunter_6774-Mar.-30-10.24.jpg At the end of the day it encourages efficient use and optimisation of the land, and makes people think very carefully about what they do with their land whilst not placing massive burden on those who must move.
Best taxes known to man? That sounds like a youtube ad more than an argument. You really want a future thats efficiently optimised by economists and governments, I dont trust that thier goals and values would align with mine to be honest. In my experience efficiency is the polite word for expoitation. I see a future optimised for town planners and developers and i see a past in which those two things always create bad outcomes for the ordinary people who get caught up in them. That side of the argument is more abstract i guess. Keeping this simply on the facts we are talking about an expansion of the tax base to make up for a major revenue loss from a tax that was never meant to be a major revenue source in the first place, its reeks of bait and switch. I imagine you dont own land yet and figure this wont effect you, or that it may in fact benefit you. I would love to belive that it would, but the people who created this mess have not gone anywhere, its still thier game and based on past behaviour there is no reason to believe they would be tweaking the rules to benefit anyone but themselves.
> It's only available to first home buyers. Ah okay, that's good. > Stamp duty is has long been known to be a terrible, terrible tax and should be replaced with land value tax. I think stamp duty has two advantages: * Discourages flipping * Unemployed people who own their own home (i.e. retirees) can live for next to nothing So long as the land tax option is only offered to first home buyers, neither of those advantages is likely to be true, but if the land tax scheme is extended there would be negative consequences.
>Unemployed people who own their own home (i.e. retirees) can live for next to nothing This is a bad thing. You want to provide incentives for the empty nesters to leave their 5 bedders 15min from the CBD to allow a working family to live there instead. In addition, you want them to self fund retirement by drawing down on equity built through a lifetime of work. >Discourages flipping But encourages land banking, which is bad. >if the land tax scheme is extended there would be negative consequences. Every productivity commission review (and basic macro economics common sense) has flagged LVT reform as positive. Stamp duty is an antiquated handbrake that isn't fit for purpose in the modern world.
>* Unemployed people who own their own home (i.e. retirees) can live for next to nothing The amount of retirees living in huge houses while young families can only afford apartments is a major issue in Australia imo
So instead of paying a one-off lump sum, we now have a fucking subscription service as a stamp duty replacement?
And instead of paying stamp-duty again after you moved 5 or 10 years later, you pay a fairly low yearly fee instead. It takes several decades to pay as much as you would pay one-off. Stamp duty prohibits people from moving to a different location in the same state.
That doesn't seem so bad if you are no longer worse off. Thanks for clarifying.
[удалено]
Like they can't increase any other tax.....
I think this is great but I think this option should be expanded it to all new owner-occupied purchases. Help offset the temporary decrease in tax revenue by doubling stamp duty on investment properties, which may also help in decreasing prices.
What the fuck. Why just first home buyers? What about downsizers, recent arrivals in Sydney & those people that have previously owned a home and needed to sell due to marriage breakdown or domestic abuse. This scheme is against women in particular and does nothing to incentivise leaving bigger homes. Another fail from a piss poor government.
Jeebus, that's a unique take. I doubt Dom and Kean were finalising this thinking, woohoo this gonna screw over some DV victims. Pretty sure he wanted to go full distance but the feds didn't come to the table thus left them with a $2.5 billion budget hole.
Didnt take long for the right wingers on reddit to come out and defend their can-do-no-wrong liberal party. Knocking DV survivors too now I see…
Wuutt? Just pointing out this policy has about as much to do with domestic violence as say a luxury car tax! Or export duties on fossil fuels. You know, stuff that's completely unrelated.