When buying a house in Australia, you are levied a tax called Stamp Duty on houses depending on the purchase price.  The rate of stamp duty is calculated on the basis of the price of the property.  The rate of stamp duty is higher for high cost houses.  States levy different rates of stamp duty.  New South Wales, Queensland, Western Australia levy the highest rates of stamp duty and the first time home buyers are exempted from payment of stamp duty for buying houses costing less than $500,000.  In spite of the government’s grants for first time home buyers, they could not avail it because of the huge stamp duty levied on home purchase. Recent cuts in the stamp duty in some states like Victoria have resulted in houses becoming cheaper by thousands of dollars. The government uses the revenue from the stamp duty for funding public welfare services such as health, education, law and order and public safety.  Stamp duty concessions can be availed in case of certain property transfers residential or business.  You can find out which concession is applicable to your property from the Office of State Revenue in your state.

In the recent years the rise in taxes has affected residential property depriving thousands of people from home ownership.  The research report for the Residential Development Council has revealed that the combination of levies such as various taxes, charges, fees and levies on the purchase price of a new house has reached alarming levels by more than 300 percent.  The soaring stamp duty bill hinders the Australians from entering the housing market. The Bankwest Residential Stamp Duty report says that their research has found that the stamp duty on a typical Australian home has increased 59 percent during the past 5 years.  This is almost double the rise in the household income in that period.  The stamp duty bills amounted to $53 billion that has been collected by the State and Territory Governments in the past 5 years. The stamp duty revenues have grown by a 77 percent during the same period.  The rise in stamp duty in the past 5 years in Northern Territory is 145%, in Western Australia 127%, South Australia 102%, in ACT 111%, in Queensland 151% and in Tasmania it is 177%.

The rise in stamp duty rates has compelled the home buyers to reserve 20 percent of their annual household income merely for paying stamp duty in cities like Melbourne, Sydney and Adelaide.  Stamp duty cuts are being designed to encourage new entrants to the property market.  Victoria has the highest rates of stamp duty in Australia.  This levy is making the Melbourne houses expensive and makes the city of Melbourne the least affordable city in Australia.  Brisbane stamp duty bills are found to be lowest by the Bankwest research. Online stamp duty calculators can help in calculating the exact stamp duty on houses by taking into account the rate of stamp duty in the state where the property is located and other parameters.