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REIWA is disappointed that the Federal and State Government’s Building Bonus Schemes failed to address the biggest impediment to job creation and hurts those who can afford it the least.
REIWA President Damian Collins said the Institute understands that this scheme is aimed at providing short-term jobs at a crucial time, however both the Federal and State Governments have missed an ideal opportunity to undertake critical tax reform.
“While the scheme will create short-term jobs and help people get into homes in WA, the remaining 99 per cent of West Australians who won’t get to utilise the scheme, are still potentially lumbered with stamp duty if they want buy a property,” Mr Collins
Yesterday’s state package was better than the federal scheme as it is available to more people, but it does not address the barriers to moving that many people encounter.
Numerous studies have shown that removal of stamp duty creates significant economic activity and the benefit to the WA economy could be as much as $1 billion per annum.
“While the scheme will have a short-term boost to the economy, post 31 December 2020 we will be back in the same position, with stamp duty blocking upwards of a billion dollars of activity and thousands of jobs annually,” Mr Collins said.
“With Victoria and New South Wales focused on getting rid of stamp duty, there has never been a better time for WA to also consider its removal to help boost jobs and the economy.”
The impact of the building boost schemes is unlikely to have much effect on most of the established market, it will hurt those who can afford it the least.
“Perth outer suburbs such as Ellenbrook and Baldivis suffered the most during the downturn, with many people who purchased house-and-land packages in these areas now in negative equity and suffering mortgage stress.
“Just when things were picking back up, home sellers in the outer suburban areas will find themselves potentially at another $45,000 disadvantage compared to a new build.
“This could have serious ramifications for their financial position and at the very least, the State Government should consider providing stamp duty relief in the short-term for buyers in these suburbs, so that the financial impact is minimized.”
REIWA will continue to call for the introduction of initiatives that will create jobs and make the housing market more accessible for all West Australians. For more information on REIWA's advocacy efforts, view our advocacy page.
Want to know more about stamp duty in WA? Read State tax reform is officially on the agenda for the 2021 State Election.
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