The economic impact of stamp duty has been saved
The economic impact of stamp duty
Three reform options
Stamp duties have traditionally been a significant revenue earner for state governments, but they also impose particularly high economic costs. The pursuit of an efficient tax system has led to calls for their replacement.
Commissioned by the Property Council of Australia this report investigates the economic impacts of removing stamp duties on conveyances in each of the states and territories in Australia. Stamp duties currently raise significant revenues for the states, and average around a quarter of total state tax revenues. Hence, while their removal would require replacement of state revenues, the efficiency costs of including them in the tax structure is also magnified by their size.
This work investigates several aspects of the impact of stamp duty abolition:
- The impact on the property market, with a particular focus on prices and transaction volumes
- The state government revenues to be replaced from a removal of all stamp duties on conveyances, from a removal of stamp duties on non-residential property transactions only, and from the removal of duties on new residential properties only
- The economic benefit (in terms of employment, GDP and welfare) from replacing stamp duties with a more efficient tax.