The Real Estate Institute of Western Australia (REIWA) has called on the State Government to introduce stamp duty reforms to help first-home buyers and seniors, off-the-plan purchasers and small businesses.
The proposed reforms would include a $10,000 residential stamp duty concession for over 65s, increasing the stamp duty free threshold for first-home buyers, permanently locking in the Off-the-Plan Duty Rebate Scheme and cutting stamp duty on the sale of small business assets.
“These reforms would pose minimal risk for the WA Government, deliver significant benefits to the economy and housing market, and ease the unfair financial burden placed on everyday West Aussies by these inefficient taxes,” Mr Collins said.
Mr Collins said stamp duty was a major disincentive for downsizers and kept them stuck in unsuitable accommodation.
“Stamp duty concessions for seniors is not a radical idea,” he said.
“Victoria, Tasmania, Australian Capital Territory and Northern Territory all offer seniors stamp duty concessions, there is no reason WA can’t do the same.
“Introducing a one-off, $10,000 stamp duty concessions for seniors would ease the burden of these upfront costs and help people aged over 65 right-size into more suitable accommodation.
“This would free up housing stock and assist with mobility across the entire market.”
With house prices in WA growing in value over the past 18 months, Mr Collins wants to see the First Home Owner Rate of Duty (FHOR) duty-free threshold increased from $430,000 to $530,000, with the concessional rate threshold lifted accordingly.
“It is important that the WA market remains accessible for first-home buyers,” he said.
“We need to ensure that the duty-free thresholds and concessional rates for first-home buyers is reflective of where the market is at.
“We have seen strong price growth across the state over the last 18 months, so it is time to adjust the thresholds to ensure the dream of home ownership remains achievable for West Australians.”
The Off-the-Plan Duty Rebate Scheme was introduced in 2019 to incentivise the development of multi-unit dwellings. The program was set to expire on 23 October 2021, however, the scheme was extended until 24 October 2023.
“We were pleased the WA Government decided to extend the scheme in its 2021-22 Budget, but now it is time to make this a permanent fixture of the WA taxation system,” Mr Collins said.
“If this scheme is removed, the demand for apartments will soften, which will impact the steady supply of diverse housing and reduce the creation of construction jobs in the state in the medium to longer term.
“The Off-the-Plan Duty Rebate Scheme has been very effective in promoting infill and is precisely the policy measure that our property market needs to reduce urban sprawl.”
Mr Collins said it was also time for WA to fall into line with the other states and remove stamp duty taxes on small businesses.
“Victoria, New South Wales, Tasmanian, South Australia and the Australian Capital Territory have all removed stamp duty from small business sales, it is high time WA did too,” he said.
“We are creating a business environment that is less competitive than the eastern states and placing a cost burden on small businesses which discourages productivity and the entrepreneurial spirit.
“Small businesses need support now more than ever as WA adjusts to living with COVID-19. It is essential that the WA Government remove this obstacle and implement policies that boost productivity.”