A signature reform of the Perrottet government targeting first-home buyers is likely headed for the scrap heap as the NSW Labor government secures support from key members of the cross bench.
Labor will introduce laws on Tuesday to increase exemptions on stamp duty or first-home buyers, up from a previous cap of $650,000 to $800,000, and introduce concessions on homes up to $1 million.
The party will also scrap the former coalition government’s reforms which gave first-home buyers a choice between paying up front stamp duty or a yearly land tax, on properties valued up to $1.5 million.
The government has secured support from the Greens and independent MP Alex Greenwich, with the reforms likely to pass as soon as next week.
The government still requires support from two upper house crossbenchers.
Treasurer Daniel Mookhey says the former government’s reforms would have saddled home owners with a rising tax that would last forever.
“We took a clear policy to the election and we got a mandate to take more first-home buyers out of the tax system altogether,” Mr Mookhey told Sky News.
Some 4800 people have chosen the land tax since it passed the parliament late last year while more than 6000 had received a stamp duty waiver or reduced rate.
Premier Chris Minns said under the current scheme, more than half of the tax concessions went to 13 per cent of first-time buyers.
“We’ve made a deliberate decision to ensure that this benefit is applied to a vast greater number of people than the existing scheme,” he said.
It comes six months after both cross benches, with a very similar make-up, passed the Perrottet government’s reforms.
Greens spokeswoman Abigail Boyd says her party never endorsed the Perrottet government’s stamp duty reforms, saying it did little to address the state’s housing affordability crisis.
“It was a bad idea back then, and six months on it’s got no better,” she told AAP.
Labor’s bill would support people “doing it tough”, offering concessions to people trying to buy homes under $1 million.
Liberal shadow treasurer Damien Tudehope criticised Labor’s proposal, saying it would eliminate choice for first-home buyers and put them “two years behind” in saving for stamp duty.
UNSW Professor of Housing Research Hal Pawson says there is little evidence the government’s new scheme will help more people buy their own home.
“There really isn’t any difference between stamp duty concessions and first-home buyer cash grants which … are pretty widely understood to be inflationary,” he told ABC Radio National.
“(It is) making the problem that they’re trying to solve worse.”
The Victorian government on Tuesday moved to abolish stamp duty for commercial properties, which Premier Daniel Andrews said would boost the economy by up to $50 billion.
– AAP
