A new taxes is being advocated by The Grattan Start - and also I’m telling you today, you’re not likely to like it!
The Grattan Institute, that is an independent think tank committed to developing high quality public coverage solutions for Australia’s future, is actually proposing a brand new tax about property owners.
Aimed at raising $7 billion a year, the house ‘levy’ they are promoting for would be charged with 0.2%, or $2 per $1,000, on the unimproved value of every residence in Australia.
It might be attached to the council prices valuation, and thus would essentially be due on your terrain value.
It’s believed that the once-a-year charge will be around $772 around the median-priced Sydney residence, $560 on the median-priced Melbourne home, and less in other cities and regional locations.
You can’t point out I didn’t warn you; I said you wouldn’t like this media!
Note that this really is by no means a sure thing; it’s not even technically on the table. It has simply been proposed through the Grattan Institute, but they have offered a number of tax initiatives to do with property over the years that have never come to being.
And on a good note, their particular working document argues the levy might be used to finance the reduction and eventual abolition of stamps duties, that they describe as getting “the most ineffective and inequitable state taxes”.
No-one likes the concept of a new house tax. It’s hard enough as an trader these days to create a 20% property deposit, let alone add late charges and costs to the equation. But when this is a calculate that paves the way for stamp duty to become eliminated, then I think that’s moving we can possibly get behind?
To you: an amount you prefer? A little property tax levy charged on an annual basis? Or is a large upfront cost in the form of stamps duty a simpler way for you to manage your property investing budget?
Til next time, pleased investing!
The fastest-growing household size, according to a new report, is single-person households. Click here to know more about Real Wealth Australia.