Voting Results: (40k+ votes!)
The NSW Government is considering giving home buyers the choice to pay either stamp duty and land tax (where applicable) OR a new annual property tax. If this scheme is successful other states may consider the same move as well.
21/06/2022 Update: NSW Premier announced First Home Buyer Choice scheme today which allows eligible first home buyers to choose stamp duty OR annual property tax on purchases of new or existing homes above $650,000 and below $1.5 million.
A first home buyer purchasing vacant land on which they intend to build a home for up to $800,000 will also have the choice of either stamp duty or an annual property tax.
First home buyers will continue to be eligible for first home buyer stamp duty exemptions and concessions. Because first home buyers purchasing a new or existing home for up to $650,000 are exempt from stamp duty, they are not expected to choose the property tax.
The property tax option will become available on 16 January 2023. For contracts signed in the period between enactment of the legislation and 15 January 2023, eligible first home buyers will be able to apply to choose the property tax, but they will still need to pay stamp duty and then apply for a refund of stamp duty from 16 January 2023.
Stamp duty is triggered by a property transaction and levied on the sale price. Because it increases the up-front costs of home purchase, it is a major barrier to anyone saving for their first home or wanting to upgrade.
If property tax is implemented, the proposed changes could give people the freedom to choose between paying stamp duty upfront or paying a much smaller annual property tax, when they buy the next home.
Unless you are buying a property, there would be no change. If you have already paid stamp duty on your existing property, you would not be subject to an annual property tax. There would be no double taxation.
Property Tax Reform At A Glance
- Annual property tax would be based on unimproved land values and NOT the market value.
- Property tax would apply to each individual property and NOT on an owner’s aggregate value of landholdings.
- People who are about to buy a property could choose between paying stamp duty upfront, or paying an annual property tax. (21-06-2022: First Home Buyers only so far)
- For people who have already bought a property and paid stamp duty, there would be no change. There would be no double taxation.
- Under the proposal, residential owner occupiers and farmers would pay lower rates than residential investors, who would pay lower rates than commercial property owners.
- A potential policy option is to abolish first home buyer stamp duty exemptions and concessions, but provide short-term financial support via a cash grant.
Calculate your potential property tax
To calculate your potential property tax you will need to know the value of unimproved land of the property. You can find it here. You need to have your property number which can be find on your Notice of Valuation or can search the property number by the address. After you have the unimproved land value of the property please launch our property tax calculator: