The South Australian Government has today floated the idea of abolishing or reducing stamp duties (aka conveyance duties) on property in exchange for a broad-based land tax.
In a discussion paper canvasing various reform options, the Government notes that stamp duties are “generally considered to be one of the least efficient taxes levied by the state, as it is a tax on transactions rather than value. Replacing conveyance duty with another tax on property is generally considered most equitable as it would balance any impacts on asset prices associated with tax reform”. The paper also notes that moving towards a broad-based land tax would mean that “all owners of property pay an annual tax, not just when they purchase”, with a median value home likely to attract a tax of around $1,200 a year.