Thursday, 11 September 2025

Stamp duty

David LIMBRICK (South-Eastern Metropolitan) (12:25): My question is for the Treasurer. Recently there was much reporting about this idea of an empty bedroom tax. Although it is an awful idea, it did highlight a real problem and a problem that was identified in the stamp duty inquiry, and this is around the idea that stamp duty distorts the market by disincentivising people to downsize to a smaller home. As an alternative proposal, what I would be interested in is: has the Treasurer received any advice or given any consideration to the idea of providing stamp duty exemptions to people moving into a house with fewer bedrooms than what they currently live in?

Jaclyn SYMES (Northern Victoria – Treasurer, Minister for Industrial Relations, Minister for Regional Development) (12:26): I thank Mr Limbrick for his question and the opportunity to potentially engage in a conversation around positive tax reform. I am always open to good ideas. I think what you have touched on is something that was a motivation for the stamp duty exemptions for off-the-plan apartments, townhouses and units, for instance, because we knew that that would hopefully incentivise downsizing to free up the larger homes for young families and the like, which is where some of the bottlenecks are.

To be specific to your question, I have not received formal advice in relation to the proposal as you have articulated it, but it certainly has been something that has been a topic of conversation before. I think some of the issues you have got to consider are that the cohort of people that would be downsizing are potentially, and quite often, those that already have equity and perhaps already have means, so therefore you are potentially putting them into a contest with those that would not benefit from a stamp duty proposal as you indicated. It might be an unfair contest between perhaps first home buyers and downsizers, so you would have to consider the impacts in relation to that.

I would also question the evidence of whether paying stamp duty is in fact a barrier to downsizing, or would people do it anyway, and therefore if you were to implement such a policy, would you not get a policy outcome and therefore you would just get a reduction in revenue? One of the criticisms of off-the-plan stamp duty is that it is applicable for luxury penthouse apartments and the like, and I think if you are downsizing from an outer-suburban two-storey house into a luxury apartment, is that something that would be fair, considering you might actually be buying a more expensive smaller home and the like? So I think there are a lot of things to think through for a policy like that, but it is certainly not without merit.

As you have indicated, there is a good policy basis for making sure that houses that are too large and not fit for purpose for potentially older people – I would put my parents in that category. They have a four-bedroom house and probably would look to downsize now or in the future. It is nice to go home and be able to stay with your parents, but I recognise that that house is where I grew up and no longer do they have two kids living with them. So I understand the policy intent that you are potentially looking for, and as always I am certainly open to further conversations. I am particularly happy to potentially see if there is any advice that I have got that I could provide to you if you want to give some greater thinking to the policy.

David LIMBRICK (South-Eastern Metropolitan) (12:29): I thank the Treasurer for that response, and I will proceed to try and get some more information on it.