Not long after my book "Property & Conveyancing Made Easy" was released, both the New South Wales and Victorian state governments made similar announcements, at the same time, to review stamp duty with land tax during 2021. There has been an ongoing debate about stamp duty, once a small tax, and previous promises by opposition parties to abolish it if elected. This never happened. When the GST was introduced by the Howard Government in Canberra, their campaign was GST = Good-Bye Seven Taxes. The defunct Australian Democrats in the Senate demanded basic food grocery items, health and education to be exempt from GST as a trade-off. Those seven taxes, including stamp duty, remain.
Australians are the "brick and mortar" investors, where property is the king of investments, with tax benefits, such as negative gearing and tax depreciation allowances. It also attracts the most taxes, by all three levels of government, compared to other investment classes. In property, you have council rates at the local government level, water rates, stamp duty and land tax at the state government level. Then there are capital gains tax and GST (new residential and commercial/industrial) at the federal level. In other words, property is taxed, when you buy, hold, invest and sell out (sell off, when it's not the principal place of residence).
Taxation reform is a "hot potato" when it comes to Australian voters and taxpayers. After Paul Keating's famous "banana republic" speech, the GST took almost 20 years to bring in and implement, which occurred under John Howard and Peter Costello.
Since then, taxation reform at federal and state levels been contentious with Australian voters and taxpayers.
For example, in New South Wales, then Premier Bob Carr and Treasurer Michael Egan, brought in the Vendor Exit Tax and changed principal place of residence in land tax. This caused so much controversy that both bob Carr and Michael Egan then called media conferences on a lovely sunny day in Sydney during June and announced their exit/retirements out of government/parliament.
During 2019, on top of the opinion polls, then opposition Leader Bill Shorten announced changes to negative gearing and capital gains tax. This caused a federal election upset in 2019, with the return of the Morrison Government and the rejection of Bill Shorten, with his policies on negative gearing and capital gains tax.
Now in 2021, both the Victorian and New South State Governments are reviewing stamp duty and land tax, with the view of reducing/phasing out stamp duty and broadening the burden of land tax, which includes abolishing the exemption of principal place of residence. My gut feeling is that this is to test the waters before making an alternative type of reform, acceptable to voters and taxpayers. Land tax is already an unpopular tax, especially for property investors and owners of commercial property, who see the irregularities in land tax. The Valuer General's Office now uses a "scatter gun" approach to prop up land tax revenue for the state government. Experiences in United States of property taxes across the board, no principal place of resident exemptions, see their tax rates keep going up to cover US state government budget blow outs. In Victoria and New South Wales, it's possible that the state governments will abolish stamp duty and replace it with land tax across the board (with no principal place of residence exemptions). As Sir Humphrey Appleby once said to Minister Jim Hacker in the BBC Yes Minister series, "Minister, you about the make the most courageous decision on your political life!" Let's see what the reform ends up looking like in Victoria and NSW.