The Long Road Ahead for NSW Property Tax Reform

Commentary Dominic Perrottet’s elevation from Treasurer to Premier of New South Wales (NSW) has brought attention back to his long-term plan to replace the stamp duty on property transactions with an annual tax on land value. Perrottet wants to make his mark as a reformer, and this is one key reform idea he developed as Treasurer that is more likely to progress now that he is Premier—but the idea has a long way to travel and many obstacles to overcome before it becomes policy. There isn’t even a firm proposal from the government yet. They are still working on that. There is wide agreement among economists that a small annual tax on property value is more efficient than a much larger tax on property transactions. A transactions tax can strongly distort people’s decisions on buying and selling, whereas an annual tax on property value, if well designed, will have no …

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