The federal Parliament’s standing committee on taxes turned its attention towards the property sector last week, announcing a formal inquiry into housing affordability and supply.
The inquiry, to be led by committee chair and Liberal MP Jason Falinski, will examine the impact of tax and regulatory regimes on price, affordability and supply of housing in Australia, in the present and into the future.
The House of Representatives standing committee on tax and revenue has said that it will be taking submissions from stakeholders, interested individuals and organisations until 13 September.
However, less than 24 hours after a the inquiry was announced, a real estate industry body responded with potential tax and regulatory reforms.
The Real Estate Institute of Australia (REIA) welcomed the move, with REIA president Adrian Kelly calling out stamp duty, transfer duties and land tax as the biggest barriers to housing affordability.
“Families across all the states and territories, except the ACT, are paying more stamp duty today than 20 years ago, and [it is] time to get serious about stamp duty reform.”
According to Mr Kelly, “Politicians cannot on one hand gripe about housing affordability, and then on the other say we need this income from home buyers and owners to fund public sector operations.”
The REIA called on the Council of Federal Financial Relations to take these issues more seriously, accusing them of shifting responsibility on to each of Australia’s state and territory governments.
“The lack of national coordination has led to limited supply of both new and existing listings across the board. Now more than ever, we need fact-based and bipartisan support on policy issues for home buyers and home owners,” he said.
Speaking of the need for the review, Mr Falinski echoed statements from the Reserve Bank and other organisations that regulatory settings are “directly responsible for the unresponsive nature of housing supply in Australia”.
“Arguments about the impact of increased subsidies and tax concessions on housing have continued for some time,” Mr Falinski said.
“There is ample evidence that points to the small effect such measures have on supply, indeed the research points to limitations on land and restrictive planning laws as the major causes of shortages in supply.”
Public hearings for the inquiry will be held in due course.
The National Housing Finance and Investment Corporation also backed a stamp duty scrap in July.
[Related: Home buying sentiment slides: NAB]