The South Australian Liberal Party has proposed a bold plan to phase out stamp duty by 2041 if they secure the next election victory. This ambitious policy, unveiled by Opposition Leader Vincent Tarzia, aims to provide immediate relief to first-time homebuyers by waiving stamp duty on existing homes valued up to $1 million. Over five years, the Liberals plan to adjust stamp duty brackets, ultimately abolishing the tax within 15 years.
Tarzia argues that stamp duty is an inefficient tax, hindering young people's homeownership and making it challenging for older individuals to downsize. He believes that this gradual change will benefit the economy in the long run, making South Australia one of the most competitive jurisdictions in the country.
However, Premier Peter Malinauskas has criticized the proposal as 'reckless and dangerous.' He warns that the abolition of stamp duty would result in a significant revenue loss of $2.3 billion annually, equivalent to the entire South Australian police force budget. Malinauskas argues that this policy could exacerbate the housing crisis by reducing the supply of homes, making it even more challenging for young people to enter the market.
The Liberal Party's costings remain unclear, with Tarzia promising to reveal the details before the election. He refutes the idea of cutting frontline services and emphasizes the need to grow the economic pie, not just reduce costs. The debate over this policy highlights the differing views on taxation and its impact on the housing market and the economy.
