The residential building industry is being weighed down by excessive and inefficient taxation,
beyond just stamp duty, according to the Housing Industry Association (HIA).
“In some states the total tax bill amounts to over 40 per cent of the final price of a new home,”
said HIA Chief Executive Industry Policy and Media, Graham Wolfe.
“Taxes on new housing are a brake on economic activity, and represent a constraint on housing affordability and labour productivity.
“There is no question that Stamp Duty is one of the key offenders, with research undertaken
last year for HIA by Independent Economics identifying it as the most inefficient tax in
Australia’s entire taxation system.
ALSO SEE: ‘Stamp Duty Out Of Control': Homebuyers Plied With 800% Tax Increase
“As a tax on moving, it discourages households from relocation when this decision may better
suit their needs in terms of size, location or employment opportunities. Unfortunately, the
economy and the community do not get the best use out of the available housing stock.”
The HIA said that infrastructure charges, GST and stamp duty add $140,000 and more to the cost of a new home in Sydney, while a plethora of other taxes, levies, fees, charges, rates and duties take the total tax grab to over 40 per cent of a new house and land package.
“Taxes add more than $250,000 to the price of a new home in Sydney, accounting for 40 per
cent ($1,350 per month) of repayments for the life of a home mortgage,” Mr Wolfe said.
“Incredibly, in supplying shelter for Australians, residential building contributes 13 per cent of
all GST revenue collected by the Commonwealth. Sadly, that taxation revenue drives up the
cost of housing.”