What is Stamp Duty?
Stamp duty or transfer duty is a tax required by the state or territory governments on transfers of property such as business or real estate, and usually it’s the purchaser or transferee who is accountable.
Stamp duty also varies between states and territories. In 2000, Victoria removed stamp duty for business. New South Wales, Australian Capital Territory, Tasmania, and South Australia all pursued the same decision over the last 20 years. Just three states including Western Australia, continued to collect stamp duty on the purchase of a business.
The WA government aims and has committed to reinforce the West Australian jobs and increase investment in our state. One of the key elements should then be promoting and encouraging people to purchase a feasible small business. More businesses mean more jobs!
However, stamp duty on business sales in Western Australia makes it financially more difficult for anyone looking to purchase a business in our state.
A buyer will be obliged to pay $251,415 when a business is sold at $5 million value. Imagine how useful that amount can be! That could cover extra 5 staff members or 10 additional trainees. Challenging enough with the COVID-19 situation, we don’t need this added burden on business Buyers willing to invest in our state.
According to the Australian Bureau of Statistics, businesses operating in WA kept on decreasing in the last five years. Elimination of stamp duty on business sales, will assist business owners in being able to sell their business when the time comes to exit. Being able to sell the business, maintains operations, keeps jobs, and sustains economic productivity.
Angela Williams – Chairperson of the REIWA Business Agents Committee, we at REIWA would like to urge the McGowan Government to eliminate the stamp duty for business. We want to help attract more investors and make WA more competitive to our eastern counterparts.