Victoria’s major parties are being urged to follow New South Wales and swap stamp duty for a land tax system.
Key points:
- The state’s peak business group has suggested property buyers should be able to make smaller annual payments rather than a large one-off sum
- It argues the change would make Victoria more competitive with NSW
- The business group has also called for the creation of an “agriculture passport” to enable freer movement of farm labourers
The Victorian Chamber of Commerce and Industry (VCCI) released its 2022 state election policy platform on Wednesday, 73 days before voters head to the polls.
Its 61 recommendations include that Victoria replaces stamp duty with a broad-based land tax system, ahead of a planned tweak in NSW from next year.
The properties will not be locked into the tax if sold.
VCCI chief executive Paul Guerra said NSW’s move was a good first step and Victoria should adopt a similar model.
“We don’t have to be the first. We just have to be the best,” he said.
Business group says hit to state budget would be short-term
Mr Guerra argued significant stamp duty on property purchases was “limiting mobility” for workers.
He suggested an annual tax would help people sell and move houses more quickly.
“We know housing continues to be one of the biggest issues that we face at the moment, particularly in regional Victoria,” Mr Guerra told ABC Radio Melbourne.
“If there’s a way to increase mobility by enabling people to sell and move more readily, we think this will be one … stimulus.”
He said while the change might hurt the state budget in the short term, the reforms were about looking to the future.
“Any change is hard, but that shouldn’t be the reason for not doing it,” he said.
“We know it catches up, depending on which model you go, it catches up over about a decade or thereabouts anyway, so it’s a point in time.”
Earlier this year, the Andrews government dumped a suite of proposed property tax reforms after a backlash from the development industry.
Business also pushing to scrap regional payroll tax
Increasing Victoria’s payroll tax threshold from $750,000 to $1.2 million to match NSW would also deter businesses from moving across the Murray River, he said.
“We’ve got to be at least as competitive as NSW,” Mr Guerra said.
Victoria and NSW share the same payroll tax rate of 4.85 per cent.
It drops to 1.21 per cent for businesses in regional Victoria, but the VCCI is keen for it to be waived altogether.
Other pushes from the business group include:
- An “agriculture passport” to allow seasonal employees to work across growers and farms instead of being restricted to one employer
- A housing development scheme for regional Victoria
- A 10-year experience economy strategy focusing on tourism and events
- A 10-year manufacturing strategy to boost production in existing and emerging industries
- A zero youth unemployment goal by 2026
AAP/ABC
