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Stamp duty hot potato burns

SUBJECT to an overall 29 per cent increase in stamp duty and a widening land tax net, the property industry has often accused the Gallop Government of treating the industry like a cash cow. 

Treasurer Eric Ripper said the Government did not consider the property industry a soft touch and that a drop-off in the property market had been accounted for within the States budget. He said that market forces, not State charges, were the driving factor behind increasing property values.

Paul Sadleir, Cedar Woods Properties Limited chief executive: “I’m here in the property development sphere and my notes tell me that within 20 and 35 per cent of the purchase price of a new house and land package is now for State, local and Federal taxes.

“Whilst when property prices were lower people were able to accommodate that, we are seeing housing affordability really being questioned now. While it is certainly worse in Melbourne and Sydney, Perth is rapidly catching up so I think it is time we look at the overall tax take overall and look at the pressure points and relieve that pressure and perhaps pick up the slack in other areas.”

John Mair, Mair & Co chairman: “Going on specifically to my hot potato, which is the land tax issue, I think that everyone thinks the property industry is a soft touch.

“Stamp duty affects the property industry more than anything else; land tax is ridiculous. When you start bench-marking this against the CPI you really start to get things in perspective. 

“Our office building in the city had gone up by 60 per cent in land tax over the last five years; the CPI has gone up by only 13.9 per cent over the same period. How much further is this going to go? Enough is enough. 

So we’ve started this thing called the Land Tax Revolt. We’re going to make this a major election issue and I think that other people are going to latch onto the stamp duty issue, the payroll tax issue and all are going to be big rolling election issues leading in 18 months.

Gavan Forster, MBA director: “I ask myself why is housing affordability such a politically sensitive issue at the moment?  And it is because of the rate of increase that has occurred.

“The point that industry is making is that the property industry is not a bottomless pit and you can’t just keep endlessly relying on it as a source of revenue because eventually that will come to an end.”

Eric Ripper, Treasurer: “Let’s be realistic. Now the main problem first home owners have with affordability of housing is the demand for housing from others and the way in which housing prices have risen. This is a market forces issue, not mainly a taxation issue. Yes, there have been some stamp duty increases but they have been far outweighed by just the booming housing market.

“We do better in WA than nationally with the percentage of first home owners but we are still seeing a fall in the percentage of first home buyers.”

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