Parliamentary Secretary for the Central Coast Adam Crouch says criticism by Member for Gosford Liesl Tesch of the State Government’s new land tax scheme shows a “total lack of understanding”.
The scheme, passed recently in the NSW Parliament, allows first home buyers to choose between paying an annual land tax or an upfront stamp duty on their property.
It covers all properties bought by first home buyers worth up to $1.5M.
Tesch said the scheme would potentially force many out of their homes with the taxes calculated based on the value of their property and property prices rising.
“(This) land tax is incredibly short-sighted and instead of supposedly helping young people into homes this will impose a forever tax that many simply will not be able to afford,” she said.
“You do not need to major in economics to understand the overwhelming issue with the land tax.
“As it is based off the value of the home, people who buy homes today will find it increasingly difficult to keep a roof over their heads as historically the increase in the value of our homes has far outstripped the value of our wages.
“It will be future retirees who will pay the price.
“The Liberals have planted the seeds of another housing crisis decades into the future.”
The new tax allows first home buyers to opt into an annual fee of $400 and a tax of 0.3 per cent of the property’s value and will be fully operational from January 16, 2023.
“Stamp-duty is a one-off upfront cost, while this land tax is a forever cost and the total paid by a household has no clear limit as no one can tell how long someone will stay in their own property,” Tesch said.
“If the Liberals were serious about improving levels of home ownership without sacrificing future generations, they would invest in social housing, they would not introduce regressive taxes, and they would be able to come up with policies that don’t simply kick an issue down the road for future leaders to grapple with.”
But Crouch said Tesch’s comments were “gobsmacking”.
“Why would (Ms Tesch) want to deny first homebuyers the choice of an annual fee over a large upfront fee?” he said.
“This just goes to confirm that Labor and in particular the Member for Gosford have no understanding of the most basic economic principals.
“This provides choice and I and the Government have faith in individuals that they are able to make the choice for themselves.
“It’s great to see over 63,000 people have checked the online calculator so far across NSW.”
Terry Collins
First Home Buyer Choice is making home ownership in NSW easier by providing first home buyers the option between paying a smaller annual property tax, instead of stamp duty.
If you’re an eligible first home buyer looking for a property up to $1.5 million, First Home Buyer Choice can lower the upfront costs of your purchase and cut up to 2 years off the time needed to save for a deposit, fast tracking your way to a new home.
Existing stamp duty exemptions and concessions for first home buyers will continue to apply for eligible purchases of up to $800,000.
Use the First Home Buyer Choice calculator to help you compare the estimated property tax and stamp duty.
Is the property value based on the Valuer General’s determination of what it’s worth or is it based on actual market value? If it’s AMV then there are going to be a lot more property valuers required around the whole state of NSW. But if it’s based on the unimproved value then the annual tax would be worthwhile as it would take 30-40 years to reach the current upfront stamp duty cost… just saying