{"id":879060,"date":"2026-09-04T00:22:10","date_gmt":"2026-09-04T00:22:10","guid":{"rendered":"https:\/\/www.newsbeep.com\/au\/879060\/"},"modified":"2026-09-04T00:22:10","modified_gmt":"2026-09-04T00:22:10","slug":"government-addiction-to-property-tax-is-crushing-builders-and-housing-supply","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/au\/879060\/","title":{"rendered":"Government \u2018addiction\u2019 to property tax is crushing builders and housing supply"},"content":{"rendered":"

The building industry is in dire straits. Reports this week have varied, but in NSW alone, it\u2019s been revealed 1500 construction firms have gone bust in the last financial year.<\/p>\n

Nationally, there have been more than 7700 developers go under in the past two years.<\/p>\n

We need these failing businesses to survive and thrive, because they are the only ones that can build our way out of our worsening housing crisis.<\/p>\n

And unfortunately, our governments are only making things harder for them, by taxing them, and their potential customers, to their eyeballs.<\/p>\n

MORE:Man loses $650k as builder rips up all sales<\/a><\/p>\n

There\u2019s GST, developer contributions, windfall gains tax and betterment levies. There\u2019s stamp duty, capital gains tax, foreign investor surcharges, land tax, council rates, income tax on rental revenue and even absence or vacancy taxes.<\/p>\n

\"\"<\/p>\n

Builders are struggling as taxes and high costs bite hard.<\/p>\n

\"\"<\/p>\n

Bathla Group\u2019s future is in the balance as thousands of construction firms shut down.<\/p>\n

Labor also wants to tax trusts at a minimum of 30 per cent, which the building industry claims would affect family-owned and mid tier developers further.<\/p>\n

Governments are addicted to property tax. It doesn\u2019t just make them money, but it keeps their administration afloat.<\/p>\n

Just look at stamp duty. Back in 2014, the NSW government posted a $2.9 billion budget surplus. It was bragging at the time about its superior economic management as most other states and territories were in deficit. Of course, no need to mention that it coincided with a massive Sydney property boom; the first significant home price growth cycle in a decade. That surplus would have been a large deficit without the $7.2 billion it took in stamp duty revenue.<\/p>\n

MORE:Housing slump delivers $130k hit to household wealth<\/a><\/p>\n

\"Bush<\/p>\n

Prime Minister Anthony Albanese\u2019s Labor budget initiatives have been met with derision by the building industry. Picture: Jonathan Ng<\/p>\n

Fast forward to today, and the NSW government collected $14.3 billion in the 2025-26 financial year, up from $12.4 billion the year before.<\/p>\n

At a national level, the states and territories drew a total of $34.4 billion in stamp duty revenue in the most recent financial year. The national total has been hovering around the $30 billion mark each year since the Covid pandemic.<\/p>\n

Even now, with the market struggling, there will be tens of billions collected in tax from home sale transactions before July 2027.<\/p>\n

Governments have created a situation in which they rely on property tax to survive.<\/p>\n

Cutting taxes on real estate would be like taking 100 poker machines out of a suburban RSL that\u2019s struggling to stay afloat.<\/p>\n

MORE:Labor\u2019s negative gearing reforms cost tenants $24k a year<\/a><\/p>\n

\"Slot<\/p>\n

Governments need property tax, like some clubs need pokies.<\/p>\n

Australians love real estate. We live in it, we aspire towards owning it and we love to invest in it, whether it\u2019s as an income producing asset, or improvements to our own homes.<\/p>\n

It\u2019s so easy for governments to leverage all this and turn it into tax revenue.<\/p>\n

And when they\u2019ve exhausted all avenues for the creation of new types of tax, they turn to some of the existing offsets that were established in order to stimulate housing investment and that still made it a worthwhile pursuit. Things like negative gearing or the CGT discount. They\u2019re now gone.<\/p>\n

If you keep taking more pieces of the pie, the baker will eventually go out of business.<\/p>\n

And that\u2019s what\u2019s happening now. Who is supposed to build property? Who will invest in the supply of rental homes to a starving market of tenants?<\/p>\n

Don\u2019t worry about all the incentives, grants, guarantees, small deposit loans and other things the government \u201cdoes\u201d for real estate, most of which simply incentivise buyers and inflate prices \u2026 the best thing it could do would be to cut some tax. Let builders build and create supply. It\u2019s what we desperately need.<\/p>\n","protected":false},"excerpt":{"rendered":"The building industry is in dire straits. Reports this week have varied, but in NSW alone, it\u2019s been…\n","protected":false},"author":2,"featured_media":879061,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[64,63,99],"class_list":["post-879060","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-au","tag-australia","tag-business"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/879060","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=879060"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/879060\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/879061"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=879060"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=879060"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=879060"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}