SA to phase out commercial property stamp duty

SA to phase out commercial property stamp duty
SA to phase out commercial property stamp duty

South Australia is moving to abolish stamp duty on commercial property sales over the next the three years.

Treasurer Tom Koutsantonis said he was deliberately seeking to stimulate the business sector in the state with the highest unemployment in the nation. 

The scrapping of stamp duty on the 6,000 commercial and industrial property transfers that happen annually in South Australia will cost the government about $389 million over the three years from July 1, 2016.

The first stage is a one-third cut in stamp duty in mid-2016. 

The Weatherill government has thrown down an unexpected tax reform challenge to other states as it phases out stamp duty on commercial property transactions.

It does not apply to farms.

By 2018-19, the state will have stripped a $48,830 duty from a $1 million South Australian commercial deal.

It will save $543,830 after a $10 million acquisition or a $2,589,915 million cost on a $10 million transaction.

But stamp duty expert, Joanne Seve, told the Australian Financial Review other mainland states were unlikely to follow as the cost of abolishing stamp duty on non-residential, non-primary production commercial property transfers would be at a much greater cost and likely require a replacement source of revenue.

 

Jonathan Chancellor

Jonathan Chancellor

Jonathan Chancellor is one of our authors. Jonathan has been writing about property since the early 1980s and is editor-at-large of Property Observer.

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Stamp Duty

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