Tax re­form re­quired in WA

Pilbara News - - Property - Hayden Groves Hayden Groves is the pres­i­dent of the Real Es­tate In­sti­tute of Western Aus­tralia.

Elec­tions, es­pe­cially State elec­tions, are al­ways of par­tic­u­lar in­ter­est to the real es­tate in­dus­try as campaign prom­ises and pol­icy de­ci­sions can have sig­nif­i­cant im­pli­ca­tions for the buy­ing, sell­ing and in­vest­ing of prop­erty.

In the lead-up to the elec­tion, REIWA will be cam­paign­ing for the re­form of State prop­erty taxes. The cur­rent State tax ar­range­ments are a hin­drance to many peo­ple want­ing to get their foot in the door of the WA prop­erty mar­ket.

Trans­fer duty (for­merly stamp duty) is a mas­sive im­post on buy­ers mov­ing within the prop­erty mar­ket. It has been one of our key rec­om­men­da­tions for the past cou­ple of years that there be no in­crease to trans­fer duty or land tax rates and that there should be a trans­fer duty ex­emp­tion for pur­chases of off-the-plan prop­er­ties and a re­bate or ex­emp­tion for se­niors who wish to down­size or re­size.

We would also like to see the State Gov­ern­ment com­mit to a State tax re­view in 2017 to pro­vide long-term tax re­form in WA.

In our 2016-17 pre-Bud­get sub­mis­sion, we rec­om­mended that the Gov­ern­ment as­sess the vi­a­bil­ity of a shift to a broad-based land tax sys­tem that ul­ti­mately re­moves trans­fer duty from the WA tax sys­tem.

The re­moval of trans­fer duty would help im­prove hous­ing af­ford­abil­ity across the State as most house­holds need to bor­row funds to cover the cost of this duty. Once bor­rowed, that cost is then amor­tised across the life of their mort­gage and ul­ti­mately increases their to­tal re­pay­ment amounts ev­ery month.

I sin­cerely hope the Gov­ern­ment con­sid­ers im­ple­ment­ing a land-based tax regime as there would be a num­ber of ben­e­fits for the com­mu­nity. For ex­am­ple, it would al­low for greater hous­ing mo­bil­ity and pro­vide house­holds with more free­dom to lo­cate closer to em­ploy­ment and ac­tiv­ity cen­tres, which would help re­duce con­ges­tion. As the elec­tion draws closer, we look for­ward to hav­ing con­ver­sa­tions with all po­lit­i­cal par­ties and work­ing to­gether with them to help ad­dress prob­lems around af­ford­abil­ity, mo­bil­ity and choice in the hous­ing sec­tor that are af­fected by prop­erty taxes.

We want you to have your say on this is­sue. Look out for the sur­veys and polls REIWA will be run­ning on reiwa.com in the com­ing weeks. This is your chance to voice your opin­ion on the hous­ing is­sues and I hope you take this op­por­tu­nity to help shape the de­bate.

Newspapers in English

Newspapers from Australia

© PressReader. All rights reserved.