The Real Estate Institute of Western Australia has again called on the state government to reign in the state's runaway stamp duty, after new estimates reveal stamp duty on residential homes has blown out by 31 per cent this financial year.
Treasury had estimated it would rake in $1.7 billion in conveyancing taxes, but has now revised this with the expectation it will reach $2.25 billion.
President of the Real Estate Institute of Western Australia, Rob Druitt, said WA's stamp duty rates were among the most expensive in the country.
"Treasury has consistently failed to accurately estimate the level of tax revenue it would receive from the current high levels of economic growth with the result that it has overshot its estimated receipts of conveyance duty by an average of more than 40 per cent each year for the last five years.
"Instead of receiving $6 billion in revenues from stamp duty on conveyances for the financial year of 2003/04 through to today, treasury now estimates that receipts will top $8.5 billion for this period," Mr Druitt said.
Mr Druitt said homeowners in WA upgrading to a new property of around $500,000 are being hit with stamp duty of almost $21,000.
"In Brisbane stamp duty on the same priced house is only half that much, while even Sydney's stamp duty on such a home is $3,000 cheaper than in Perth," Mr Druitt said.
Mr Druitt said the government had declined to heed the advice of both the interim and final reports of the State Tax Review Committee which proposed that it could well afford to adjust the thresholds and rates for stamp duty to moderate the windfall revenues which were accruing.
"The government's own mid-year review clearly shows that it is affordable for the treasurer to look at real reform of conveyance duty thresholds which have not been adjusted since 1983.
"With house prices having grown so dramatically over the last five years, the old scale of stamp duty is completely out of kilter with current prices. The government must address the exceptional bracket creep in stamp duty that has resulted from a strong market trapped in a 25 year old tax scale," Mr Druitt said.
REIWA has recommended to the treasurer a package of reforms to property taxes which would cost in the order of $400m.
Mr Druitt said the institute's proposal is fiscally responsible and represents a return to property buyers for the over-taxation which has prevailed for the last five years.
