Wednesday, 30 August 2023

Economy and Infrastructure Committee

Inquiry into Land Transfer Duty Fees

David LIMBRICK (South-Eastern Metropolitan) (17:39): I rise to speak on the report on the inquiry into land transfer fees. In a world where people disagree on so many things, there is one thing that we can all agree on: stamp duty is garbage. In fact it is absolute garbage. I know this because that is what everyone told our inquiry. Renters, home owners, investors, young people, old people, economists, conservatives, libertarians, authoritarians, empty-nesters, first home buyers and people in the real estate industry – everybody hates stamp duty.

These days, though, you need to be rich just to pay the taxes. Stamp duty costs about $40,000 for a median house in Victoria, which is a huge hurdle for homebuyers. Most parents feel in their bones that their job is to make the world a better place for their kids – I know that I do. Yet our kids might be the first generation since colonial settlement to think they might never really call a place their own. When average married couples cannot buy an average house, something is broken.

Nearly 50 per cent of marriages in Victoria unfortunately end in divorce, so those who do buy a house and pay the tax might feel they cannot even afford to move out. This is a divorce tax that no doubt causes many people to stay in miserable marriages. There must be tens of thousands of stories out there of not just people who cannot get a foot in the market but also those who live in unsuitable houses who are discouraged from downsizing, who put up with neighbourhood disputes or noisy neighbours or who commute many more hours than they need to all because it makes no sense to pay tens of thousands of dollars for nothing.

So if everyone hates stamp duty, why do we still have it? We all know the answer: because the government wants the money. There we have it: the problem is the government. It is not young people ordering avocado on toast, it is not evil rich people or people using Airbnbs; the problem is big fat greedy governments, and allow me to give an example. Scrapping the Suburban Rail Loop, a project not many people asked for, would save $34 billion – and let us face it, much more than that once all the figures are actually tallied. But by my calculations the government could use this money to simply scrap the project and halve stamp duty for the next eight years or, even better, abolish it for four years. Then any person who bought a house could use the $40,000 left in their pocket to go anywhere they want or to stay put or to pay off their mortgage more quickly. I know this report presents many different options, but there is absolutely no reason why the government cannot do this now. There is absolutely no reason why they cannot find savings to get rid of stamp duty altogether.

Stamp duty is immoral. It creates untold misery for thousands of people in thousands of different ways. The reliance of the government on a tax everyone hates demonstrates that the government does not serve the people in this space. At the very least it must be indexed to stop the increases. But let us not pussyfoot around: to end stamp duty we must start by ending government greed. The major parties claim to be searching for ways to end the problem of housing affordability, but they must realise that government is the problem. My recommendation to this inquiry on behalf of the Libertarian Party was that this odious tax be taken out gradually to allow the government to balance its books, but you can take it out gradually or take it out immediately; either way it must go and we must replace it with absolutely nothing. Everyone agrees stamp duty is garbage, and if governments care about the people they are supposed to serve, it is time to take out the trash.