NSW Government’s progress update on tax reform
Property Council of Australia has today welcomed NSW Treasurer Dominic Perrottet’s progress report on the NSW Government’s bold plan to reform the tax system, following the release of the ‘Buying in NSW, Building a Future’ consultation paper last year.
“We all know that stamp duty is an incredibly harmful tax, but tax reform is complex, so it is pleasing to see the Government clarify parts of the plan in today’s Progress Paper,” Property Council NSW Executive Director, Jane Fitzgerald said today.
“The reform model proposed by the Government last year had many strengths and aimed to avoid mistakes of other jurisdictions.
“Treasurer Perrottet should be congratulated for his personal commitment to taking this significant reform agenda forward whilst also battling the economic impacts of a global pandemic. His thoroughness and commitment to consultation have been exemplary.
“The opportunity to remove the stamp duty blight from the NSW tax landscape should be seized, but not at any cost, so it is vital that the final proposal works for both commercial and residential property.
“Today’s Progress Report confirms some important fundamentals such as full choice for purchasers and also addresses some important matters of concern for commercial and residential property investors.”
Ms Fitzgerald said the Progress Paper also included new proposed rates for property tax with residential and commercial investors to be subject to higher property tax rates than previously proposed.
“The threshold for residential owner occupiers has been lowered while residential investors are now proposed at a rate 0.1 percent higher than outlined in November. Landowners with holdings above $1.5 million (unimproved value) would be subjected to a new 0.3 percent surcharge,” Ms Fitzgerald said.
“The higher the reform model pushes tax rates on commercial properties, the less likely they will be to opt into this new system and the opportunity to deliver the broadest reform dividend will have been missed. Getting this balance right is a critical next step.
Ms Fitzgerald said the other key matter yet to be outlined was the thresholds at which purchasers would be able to opt into the system.
Ms Fitzgerald said it was pleasing to see property industry feedback taken on board in relation to matters such as pass-through rules for commercial property and for concessional rates for charities and retirement village operators.
“The Property Council looks forward to continuing working closely with the NSW Government on this initiative and appreciates the government’s commitment to strong consultation with the industry and community on this very important reform,” Ms Fitzgerald concluded.
Read the NSW Government’s Progress Paper on Tax Reform here.
Media contact: Michelle Guido | M 0437 315 198 | E [email protected]