Rising house prices in recent years mean the ACT government is losing nothing on stamp duty, which is now close to the pre-tax reform levels of 2011-12.
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In the past 12 months, the tax collected from house sales has soared to $193 million, which is a $28 million, or 17 per cent, increase on the year before.
In July 2012, the government embarked on a 20-year program to phase out stamp duty, a tax described by Treasurer Andrew Barr as bad, unfair and inefficient.
In the year leading up to then, the government collected $198 million in stamp duty on house sales. In the three years following, it collected between $162 million and $166 million. In 2015-16, it collected $193 million. The figures do not include stamp duty on commercial buildings.
Over the same period, the amount collected in rates (overall, commercial and residential combined) has increased precisely 100 per cent, from $209 million in 2011-12 to $419 million in 2015-16.
The government has been cutting stamp duty each year, with the amount paid on a $500,000 house cut from $20,500 in 2011-12, to $14,600 in 2015-16 – a saving of $5900.
But at the same time house prices have jumped. The median (or middle) house price, according to Allhomes, was $520,000 in 2011 and $565,000 in 2015. That means someone buying a house at the median price in 2011 paid $21,650 in stamp duty. Someone buying a house at the median price at the end of 2015 paid $17,850 – a saving of $3800.
Treasurer Andrew Barr promised the switch from stamp duty to rates would be revenue neutral. Whether that has been borne out depends also on taking account of insurance taxes, cut from $47 million in 2011-12 to nothing this year. And it must take account of the new and increased levies on ratepayers – including the fire and emergency services levy, now an overall $54.3 million and up 92 per cent over the four years, the utilities tax (passed through in utilities bills), up 42 per cent to $27.7 million, and a new domestic violence levy kicking in from July this year.
The ACT director of the Housing Industry Association Greg Weller said it was "obviously concerning" that the government's tax reform was not keeping track with the increase in house prices. But the ACT still led the country nationally in phasing out stamp duty, which he strongly supported.
ACT buyers paid among the higher stamp duties in the country in dollars terms because of house prices. On a median-priced house in Canberra in June this year, buyers paid about $16,500, with only NSW, Victoria and the Northern Territory paying more.
But calculated differently, as a proportion of the median house price, ACT stamp duty looked better, at 2.9 per cent of the median house price, with only Queenslanders paying less (1.5 per cent of the average house price). Mr Weller urged the ACT to "keep up the pace".
"Stamp duty is one of the most economically inefficient taxes around. If we're wanting to bring the brightest and the best to the ACT we've got to compete against other states, and stamp duty is a tax that inhibits geographic labour mobility, it's a tax that inhibits you moving to a new house."
A spokesman for Mr Barr said by 2021-22, the end of the second phase of tax reform, the stamp duty on a $500,000 home would be $10,000 – less than half the amount in 2011-12 when tax reform began.
"With more homes changing hands, more homes being built and the impact of inflation, the total revenue from stamp duty is forecast to increase modestly, even though there is a significant saving on every individual transaction," he said
The same document said tax reform accounts for an increase of $557 on the average rates since 2011-12. The remaining $190 increase would have happened anyway.