Land tax would cut housing costs
A senior researcher at the University of Sydney has claimed that replacing stamp duty on property transactions with a broad-based land tax would increase the supply of housing in New South Wales and make home ownership more affordable.
Associate professor of finance at the University of Sydney Business School Jamie Alcock said such a move would increase supply, “which would in turn reduce the cost of housing”.
“For example, empty nesters would have an extra incentive to downsize to a home that meets their current needs, rather than their historical needs, in order to reduce their taxes.
“This would reduce the cost of housing and make the use of existing housing stock more efficient,” Mr Alcock said.
According to the university, research conducted by KPMG on behalf of the NSW Business Chamber and NSW Council of Social Service found that the tax switch would have a significant impact on the state’s economy.
“The single most important impact would be on house prices, which would benefit many people currently locked out of the market,” Mr Alcock said.