Australian Property News
WA and NT see greatest property tax drops
Posted on Friday, April 20 2012 at 10:55 AM
Despite a slump in the Australian property market and tax revenue over the 2010-11 period, property owners paid $3 billion in property-related taxes, according to RP Data’s Cameron Kusher.
The 47.3 per cent in tax revenue for state and local governments over the 2010-11 financial period was a drop from 48.2 per cent the year before, however the total property-related tax revenue across all governments increased by 4.6 per cent over the year, said Kusher.
The total value of residential property transactions in 2010-11 fell by 17 per cent, he said.
Capital city property values fell by 1.4 per cent and transactions were down by 20 per cent compared to the previous year.
The three big property tax hits representing 93 per cent of total property tax revenue to the local and state governments are through municipal rates (up by 6.9 per cent over the 2010-11 period), then land taxes (up by 4.1 per cent), and stamp duty on conveyances (up by 0.3 per cent).
Because of reduced property transactions in recent years it’s clear that the stamp duty tax revenue has seen a fall, said Kusher.
However the stamp duty has risen over the 2010-11 period due to increases in New South Wales and Victoria. In other states stamp duty revenue has fallen in the same period; 14.1 per cent lower than its record level of $14.3 billion in 2007-08.
“Considering that since the end of the 2010-11 financial year property values and transaction volumes have continued to fall, we would expect that in order to grow tax revenue, state and local governments may be looking to again increase land tax and municipal rates as there is likely to be limited (if any) growth in stamp duty revenue,” Kusher said.
Each state and territory saw varied changes over the 2010-11 period, with the Australian Capital Territory recording a 14.2 per cent increase and Victoria a 10.7 per cent increase.
However in the same period property tax revenue fell in Western Australia and the Northern Territory (both by 9.6 per cent), and in Tasmania by 1.9 per cent.
In regards to land tax and municipal rates, Victoria saw the greatest increases (18.7 per cent), followed by the ACT (12.5 per cent), while Tasmania saw the biggest decreases (-17.6 per cent), followed by Tasmania (-1.9 per cent).
Kusher said property-related tax growth is likely to remain minimal over the coming year and it’s likely the governments will attempt to make adjustments to inject artificial growth in tax revenue.
Follow us on Twitter.
Was this article helpful? Place a link to it from your website, or share it using the button below.
Are Brisbane auctions going the way of Sydney?
Sydney vacancy rates fall
Renovations rule, not holidays or weddings
Home reno costs are down in Queensland
Better news from the West, with Albany on top
Renters could feel APRA backlash