Fuelled by the housing boom in Sydney, the government collected a record $7.29 billion worth revenue from stamp duty over the year, with 75% of that coming from residential property transactions.
That amount has played a key role in the state recording a $2.1 billion surplus for the year.
For the previous year the government collected just over $6 billion through stamp duty, with this year’s increase driven by sales of properties valued at $1.2 million or greater.
"The $1.2 million plus market accounted for only a relatively small proportion of properties, but made a large contribution to the growth in revenue,” the budget papers said.
The budget papers predict NSW will receive more than $30 billion in revenue thanks to stamp duty from 2015-16 – 2018-19, but the growth of the duty is expected to cool.
“Residential transfer duty growth is expected to moderate to 11.8% in 2015-16 following growth rates of 21% in 2012-13, 39% in 2013-14 and an estimated 20% in 2014-15,” the papers said. +
“The current upswing in residential transfer duty has been supported by interest rate declines, strong population growth and pent-up demand following a long period of under-supply. Growth is expected to be supported over the forward
estimates by the continuation of historically low interest rates, growing population and the high level of investor demand.
“However, transfer duty is a large and highly cyclical revenue source which is inherently volatile and can be subject to sharp corrections. While there are a number of factors supporting growth, there are some risks. Growth in transfer duty
is now more narrowly based than at the beginning of the cycle.
“Recent moves by the Australian Prudential Regulation Authority outlining steps it plans to take to reinforce sound residential mortgage lending practices may also see a slowdown in activity.”
Land tax in the state contributed another $2.49 billion to government coffers over 2015-16.
