STAMP DUTY AS A FISCAL TOOL TO REGULATE REAL ESTATE MARKETS

Abstract

Property Stamp Duty, a one-off duty levied on transaction documents, has its roots dating back to the 19th century. It had famously been implemented to finance wars and other Government expenses. Today, the property Stamp Duty regiments have evolved into taxes with sophisticated mechanisms aimed at regulating real estate markets. The motivations of Stamp Duty will be classified and examined in three main groups- Stamp Duty as a cooling measure, Stamp Duty as an anti-speculation measure, as well as Stamp Duty holiday as a demand booster. This study examines Stamp Duty regiments, that of Hong Kong, England, Western Australia and Singapore, to highlight learning points as well as successes of the various implementations that would then be able to form the basis of recommendations for better Stamp Duty regiments. A more progressive and broader tax-based Stamp Duty, as well as coordinated efforts in Stamp Duty implementations are recommended. Together, they will be able to better fulfill their objectives on top of generating quality revenue for Governments.