The review comes amid rising concern about growing reliance on stamp duty – a highly inefficient and much-maligned tax blamed for exacerbating the state’s housing affordability crisis and discouraging people from moving.
Last financial year,stamp duty raised about $10.4 billion – equivalent to a record 33.9 per cent of the total tax haul. That was well up on the long-term annual average of about 23 per cent over the past 25 years. After adding in land taxes paid by investors,property taxes accounted for almost half,or 47.5 per cent,of Victoria’s tax take in 2021-22.
Government sources not authorised to speak on the record said reliance on stamp duty as a single revenue had left the state’s financial position increasingly vulnerable to fluctuations of the housing market,with cyclical downturns leading to the loss of billions of dollars of revenue.
According to Treasury’s latest predictions,the government will collect an annual average of $8.4 billion in stamp duty over the next four years,down about 19 per cent from the record stamp duty haul in 2021-22.
Asked about the existence of a Department of Treasury and Finance tax review,a spokesman for Treasurer Tim Pallas said:“We constantly review our revenue system to ensure it is appropriate to fund the services and infrastructure that Victorians rely on.”
As revealed inThe Age,a suite of planning reforms,including potentially a reduced role for local councillors in statutory planning decisions,is also being developed as part of a wider housing package,likely to be unveiled later this year.