Stamp duty bills across Australia have blown out and have risen by almost three times average house prices since the 1980s as a lack of reform to thresholds has seen massive bracket creep and cash strapped state governments have become reliant upon the tax as a source of revenue, the latest report has found.
Released by Housing Industry Association, the latest Stamp Duty Watch report found that the typical stamp duty bill in Victoria has increase from 1.9 percent of the median dwelling price in 1982 to 5.2 percent of the median dwelling price in 2017.
Over that period, average stamp duty bills in the state have surged from $779 to $25,685.
Over that same period, average stamp duty in New South Wales rose from 1.6 percent to 3.8 percent of the median dwelling price whilst those in Western Australia and Queensland rose from 1.8 percent to 3.4 percent of average dwelling prices and from 1.0 percent to 1.6 percent of average dwelling prices respectively.
In NSW, average stamp duty bills have risen from $1,050 to $25,685 over that time.
This, according to HIA, is adding to the mortgage bill of home buyers.
Average annual mortgage payments, it says, are higher by anything ranging from $997 in South Australia to $1,833 in Victoria because of the tax.
The latest report comes amid ongoing concerns that state and territory governments are reliant upon stamp duty for revenue and are therefore reluctant to engage necessary reform of the tax.
At an annual slug to home buyers of $20.6 billion, stamp duty now accounts for 26.1 percent of overall state tax revenue – up from $21.8 billion in 2001/02.
Part of the problem, HIA says is that courtesy of bracket creep has seen stamp duty bills rise disproportionately relative to median house prices.
In New South Wales, for example, brackets for stamp duty calculation have not been adjusted since 1985, when average house prices stood at around $70,000.
The report also comes amid ongoing calls for stamp duty to be replaced with a broad-based land tax.
HIA Senior Economist Shane Garrett said governments were compounding the housing affordability crisis by failing to reform stamp duty.
“State governments are increasingly reliant on rising stamp duty revenues,” Garrett said.
“This situation is not sustainable.
“The stamp duty burden is increasing under every metric: nominal dollars, real dollars, as a proportion of dwelling prices and as a share of total state revenue. Without reform, this trend will continue.
“By draining the pockets of homebuyers to the tune of over $20 billion each year, stamp duty is a central pillar of the affordability crisis.
“A long plan to do away with the scourge of stamp duty would be a huge victory for housing affordability in this country.”