As we emerge from the global pandemic,
economists are looking for novel ways to stimulate the economy. According to experts, swapping stamp duty for land tax is a powerful way to make the taxation model more fair and effective. Not only would it be a more efficient financial measure, it could also have a positive impact on home ownership rates among young Australians and current renters. While every form of taxation hurts the economy in some way, pivoting away from stamp duty towards land tax and property tax could have a lasting positive impact for young and old Australians.
Swapping stamp duty for land tax is not as
novel as it sounds, with the ACT government already implementing such a plan
and the NSW government planning to do the same via a novel opt-in arrangement.
The ACT already has Australia’s most efficient tax base, with every dollar of
revenue raised costing the economy just 21.9 cents. In contrast, NSW has the
least efficient system, with every dollar of revenue raised costing the economy
29.7 cents. Part of this discrepancy is due to the replaceme [...]