Yahoo Finance Stamp duty axed for these Aussies in 'biggest tax reduction in state's history'
South Australian first home buyers will no longer need to pay stamp duty after a value cap was lifted.
The South Australian government will axe stamp duty for all first-home buyers purchasing new properties. The move - along with extending the $15,000 first homeowner grant - was announced as part of the State Budget.
A near-immediate $243 cost-of-living payment has also been announced for concession card holders, along with the doubling of relief for some low-income renters and seniors.
Premier Peter Malinauskas abolished stamp duty for first-home buyers purchasing new homes up to $650,000 last year. But said removing the cap and retaining a focus on new builds would help increase supply to address the current housing crisis.
Malinauskas described the $30 million policy as “one of the biggest shakeups and tax reductions that we’ve seen when it comes to the cost of building and land in our state in its history”.
“The only serious way that you address a housing crisis is by increasing housing supply,” he said.
“We’re going to abolish a tax that holds up the building of more supply.”
Treasurer Stephen Mullighan said a focus of the budget was a $266.2 million cost-of-living package targeted at families and concession card holders.
Families with school-aged children will benefit from a $200 cut in school fees and an expanded sports voucher program, with the number of $100 vouchers increasing from one to two per year (which will also include music programs for the first time).
Who is eligible for South Australia's stamp duty exemption?
A first-home buyer who purchases or builds a new home will be eligible to avoid stamp duty.
With the abolition of property value limits, a first homebuyer who purchases a new dwelling broadly in line with the median house price of $750,000 will receive a benefit of over $50,000, including the First Home Owner Grant of $15,000, the government said.
Eligible properties and land include:
House
Flat
Unit
Townhouse
Apartment
Off-the-plan apartment, house and land package
Vacant land to build a new home
What is stamp duty?
Stamp duty is a one-off fee levied by state and territory governments on certain purchases, including buying a home, land or investment property.
The value of the property and where the purchase was made will impact how much a buyer is expected to pay given differing rates, price brackets and exemptions.
RELATED
Outrage as migrant tradies vital to solving Aussie housing crisis sidelined for yoga instructors
Centrelink, Tax, Superannuation: All the major law changes coming from July 1
Doctors demand Aussie bosses scrap 'pointless' sickie rule: 'Costs $50
It is considered by many as a major upfront barrier to those looking to enter the property market.
Recent research from e61 institute and PropTrack revealed the heavy burden stamp duty costs put on today’s homebuyers, costing up to six times more than a generation ago in some parts of Australia.
In Sydney, stamp duty on a median-priced home is now $44,500 - or six months of the average full-time income after tax. That’s 5.4 times higher than it was in the early-to-mid 1980s, relative to incomes.
“Stamp duty is an inefficient tax because it discourages people from moving to homes that suit them,” PropTrack senior economist Angus Moore said.
“While the rise has largely been incidental, rather than an intentional increase in tax rates, stamp duty reform is critically needed to allow the property market to operate more efficiently.”
There are different schemes across Australia to alleviate the burden, particularly on first-home buyers and pensioners.
What stamp duty exemptions are there in Australia?
New South Wales
Under the First Home Buyers Assistance Scheme, full exemptions are offered on new or existing homes valued up to $800,000 or vacant land below $350,000. The threshold for concessions is $1 million. Find out more here.
Queensland
Concessions are offered to first-home buyers who meet certain requirements through the first home concession. Full exemptions are offered for properties valued up to $500,000, while concessional rates are available for those valued up to $550,000. Find out more here.
South Australia
The Stamp Duty Relief for first-home buyers had the $650,000 cap lifted, but properties must be new or be for a new build. Find out more here.
Victoria
You can get a concession or exemption only once in Victoria if you meet certain requirements.
An exemption is available if your property is worth $600,000 or less, and a concession for those between $600,001 and $750,000. There are also temporary offers. Find out more here.
Tasmania
First-home buyers can get a 50 per cent discount on stamp duty of an established home valued at $600,000 or less up until June 30. Find out more here.
Western Australia
First-home buyers in WA may be eligible for exemptions on homes and land valued below $450,000 and a concessional rate up to $600,000 Find out more here.
Northern Territory
There are limited offers to reduce stamp duty in the NT, but you could be eligible if you buy a house and land package. Find out more information here.
Australian Capital Territory
Under the home buyer concession scheme, you can get stamp duty relief under certain circumstances on new or established homes, at any price. Find out more about the income thresholds here.
Get the latest Yahoo Finance news - follow us on Facebook, LinkedIn and Instagram.
