Perrottet pledges to overhaul ‘terrible’ stamp duty

Phoebe Loomes | February 26, 2023

The Perrottet government will expand its signature reforms to stamp duty if it wins the upcoming election as the NSW opposition calls the changes a “forever tax” that will follow home owners from property to property.

Under the coalition plan, home buyers will be able to eschew paying a lump sum in stamp duty on their first and second homes, instead paying an annual tax calculated from the land value of their property.

“Stamp duty is a terrible tax,” Premier Dominic Perrottet said on Sunday.

“It prohibits and stops many people across NSW getting the keys to the great Australian dream.”

First home buyers are already eligible to choose to pay either an annual land tax or a larger, one-off stamp duty when buying a house under $1.5 million after the state government passed key legislation last year.

After the proposed expansion of the scheme, home owners would also be able to skip stamp duty payments on their second property, instead paying the yearly land tax.

Stamp duty would only be imposed when a buyer picked up a third property.

The cap of $1.5 million for those wanting to opt in to land tax will also be raised by $50,000 every year from 2023-24.

Close to 1500 first home buyers have chosen to pay land tax over stamp duty since the changes were introduced three months ago.

Labor treasury spokesman Daniel Mookhey accused the premier of conducting an ideological experiment on first home buyers as interest rates and the cost of living surged.

“It’s clear that under Dominic Perrottet, his forever tax will now follow you around forever,” he said.

“Under this proposal, the tax follows the person. As they change their properties, the tax comes along with them.”

The premier has long eyed reform of stamp duty, proposing as treasurer in 2020 to phase it out entirely in favour of land tax.

He has since softened his approach, saying he supports reforms that give home buyers a choice.

But Mr Mookhey said Mr Perrottet had a record of campaigning for a broad-based introduction of land taxes.

“It’s no secret that Dominic Perrottet wants to go further,” he said.

“He’s refused to rule out extending this land tax beyond first home buyers.”

Labor’s competing policy proposes a stamp duty concession for first home buyers buying property up to $800,000 and a discounted rate for homes up to $1 million.

Meanwhile, the opposition on Sunday unveiled plans to push forward with a circular public transport link from western Sydney business centres to the new Western Sydney Airport.

The Labor pledge included $155 million co-funded by the Commonwealth to expand an existing business case for the metro line from the airport to Leppington and Glenfield to include an extension through to Bradfield and Macarthur in the southwest.

Another $40 million will be spent to investigate extending the Western Sydney Airport line from St Mary’s in the west to Tallawong in the northwest.

Expanding public transport in western Sydney is a key plank of the party’s election pitch as Labor says transport services are unfairly divided up across the city.

The party would also invest $3.3 million in world-leading natural disaster detection technology after an independent inquiry warned current disaster systems are not up to scratch.

The Liberal Party on Sunday announced lawyer Craig Chung would contest the south Sydney seat of Kogarah, currently held by Labor leader Chris Minns on a margin of just 0.1 per cent.

While his endorsement from the Liberal Party came less than four weeks out from polling day, Mr Chung told reporters on Sunday his campaign would hit the ground running. 

“We’re ready to take this fight up to the opposition leader,” he said.