The Bracks government's abolition of stamp duty on mortgages threatens to turn into a mirage for Victorian businesses with interstate assets.
Steve Stevens, a partner with law firm Freehills, claims this is because duty savings in Victoria will be absorbed by other states, such as New South Wales (NSW), Queensland and Western Australia (WA).
By way of an example, he says a Victorian business which has 60% of its assets in its home state, 20% in NSW, and 10% in each of Queensland and WA, will end up saving 60% of the duty on a $10 million mortgage in Victoria – that is, a saving of $24,000 out of the $40,000 otherwise payable.
However, it will pay an additional mortgage duty in Queensland (70% - that is, 10% plus the 60% Victorian proportion), WA (70%) and NSW (50% - NSW calculates the anti-avoidance amount differently).
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