With a Victorian State Election coming up this weekend both Labor and the Coalition are promising to slash stamp duty in the latest attempt to garner votes.
Labor says it will cut stamp duty for first home buyers building a house in regional and rural areas, and the Coalition will make a $750 million cut to stamp duty across Victoria.
Labor’s cuts would cost more than $115 million over four years and would begin in March next year.
The Coalition is planning to reduce rates for first-home buyers by 50 per cent.
Labor has also announced it would extend the first home owners grants through the next financial year.
Treasurer John Lenders says cutting stamp duty in the regions is not neglecting first home buyers in Melbourne.
“These are affordable tax cuts, you can’t do an across-the-board one and it will take pressure off prices in Melbourne by seeing stronger growth in the regional cities,” he said.
“There is a $20,000 assistance package for those building their own home.
“But what we’re seeing here is that this will take pressure off the Melbourne housing market – of course we’ve already seen a record number of people move to regional Victoria and that will be important.”
Opposition Leader Ted Baillieu says the Coalition will introduce the new tax rates over four years with a 20 per cent cut in 2011, with a 10 per cent to follow each year.
The Liberal Party has previously announced it will cut stamp duty for farmers under the age of 35 who are buying their first property.
Victoria’s Real Estate Institute says it favours the Coalition’s election pledge on stamp duty.
The Institute’s chief executive, Enzo Raimondo, says Labor’s promise does not appear to be as generous as the Coalition’s.
“After 11 years in government, the fact that stamp duty and affordability is a serious problem in Victoria, I would have thought that a little more than that [would have been done],” he said.
“In contrast, the Liberal Party’s policy announced this morning gives broader, much more generous tax cuts to everyone.”
He says most first home-buyers prefer to live in established metropolitan areas.
“Whilst it’s good to provide some benefits to regional Victorians, if you’re looking at tax cuts, you’d want to make sure that they were equitable and that they applied to everyone, not just a group that falls into a particular category,” he said.
Source: ABC Online news http://www.abc.net.au/news/stories/2010/11/21/3072172.htm
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