Friday, December 19, 2003

Stamp duty must go says housing study, replace with land tax (or payroll tax??): "The housing boom delivered a stamp duty windfall for the states of nearly $8 billion last financial year, but the commission said this was an impediment to the market that could 'heighten price pressures within metropolitan areas over time'. It recommended that stamp duty be replaced by alternatives including land tax and payroll tax."

"By contrast, the commission said that Mr Costello had no need to address controversial federal taxes, including negative gearing. The interaction between negative gearing, capital gains tax provisions and income tax rates had helped fuel house price rises, but it recommended against any changes that were specific to housing. Instead, the commission suggested a broader review of the way in which all investments are taxed, not just housing. But the Australian Council of Social Service said the commission's failure to canvass changes to negative gearing was "like saying that we can't put out the fire in the housing market until we have a policy on fighting fires in general"."

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