Page 2835 - Week 09 - Tuesday, 11 October 2022
This year’s budget only transfers $10 million worth of stamp duty to rates, a trajectory that means stamp duty cannot ever be abolished.
Chief Minister, the ACT is now halfway through the tax reform program. Will residential conveyance duty be abolished 2032?
MR BARR: I thank Ms Lee for the question. There was indeed a pretty grievous factual error in that AFR article. I will give the journalist the benefit of the doubt that he is not familiar with reading ACT budget papers. But the amount that Ms Lee referred to in the question was in fact an additional amount of stamp duty deduction on top of the already announced scheduled amount that is part of each step of stage 3 of the tax reforms.
So the answer to the question is yes. The current policy intent of the government is to eliminate stamp duty over a 20-year period. We are halfway through that period. That period has another decade to run.
MS LEE: Chief Minister, I ask what your response is to the statement in the same AFR article that said:
Restricting dwelling supply has artificially propped up government revenue by pushing up the price of land that the ACT sells to developers, while also inflating stamp duties and land taxes on homes.
MR BARR: I do not believe that there is any factual basis for that particular claim. Were that to be true, then the ACT’s position would be unique in Australia. But, in fact, house prices and land values have increased more in other parts of Australia.
MR CAIN: Chief Minister, how will the ACT address your budget deficits if you can no longer rely on residential conveyancing duty revenue?
MR BARR: The tax reform program sees a substitution from transaction-based taxes to broad-based land taxes over a 20-year period. The revenue base, Mr Cain, is more stable as a result, because transaction-based taxes fluctuate year by year depending on the volume of the transactions and at what part of the housing market they occur; whereas, if—
Mr Cain: So more revenue from rates? Is that what you are saying?
MADAM SPEAKER: Mr Cain, you have had your question; now hush.
MR BARR: The most efficient form of taxation available to this level of government are broad-based land taxes. They have the least distortionary impact on economic activity.
There are three things that can be taxed, Mr Cain: land, labour and capital. We tax capital as lightly as possible because it is highly mobile. Labour is taxed at a state and territory level in this country through payroll taxes, but we exclude most businesses that operate in the territory from paying payroll tax, focusing our payroll tax on large