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Mike Baird’s poll windfall: boom sets up surplus and Coalition’s re-election

Posted by on 29/06/2018

Good news for the government: Premier Mike Baird. Photo: Edwina Pickles Good news for the government: Premier Mike Baird. Photo: Edwina Pickles

Good news for the government: Premier Mike Baird. Photo: Edwina Pickles

Good news for the government: Premier Mike Baird. Photo: Edwina Pickles

Sydney’s  property boom has supercharged NSW government revenues, with stamp duty revenue jumping 50 per cent or $500 million over winter compared with last year,  potentially putting the government in a stronger fiscal position before the election next March.

The boom raises the possibility of returning to surplus a year early.

Figures published by the Office of State Revenue show that stamp duty paid on residential property sales from July to September surged compared with 2013-14, with $1.5 billion derived from nearly 50,500 sales. This compares with just under 48,000 transactions between July and September in 2013-14, which delivered $1 billion in tax receipts.

The revenue boost appears certain to continue into spring with  Saturday being the third weekend in a row of more than 700 auctions and the two to follow with more than 800. Low interest rates have fuelled Sydney’s property market with the median  house price rising 16 per cent over the past year and nearly 4per cent over the winter months.

New research from Domain Group shows some suburbs have surged more than 40 per cent over the last year, led by Artarmon  which jumped by nearly 50 per cent. Economists however warn that property price growth may have peaked. Domain Group senior economist Dr Andrew Wilson said Australia’s property prices will be “flat as a pancake” over the next decade.

The quarterly figures more than double the forecast $200 million increase in stamp duty revenue for the entire 2014-15 financial year contained in the June state budget.

Treasurer Andrew Constance warned the stamp duty bonanza may be offset by “softish” payroll tax receipts, while cooling of the mining boom meant there was also a downturn in royalties. “Everything is pointing to the economy remaining strong in NSW, but cautious optimism is key,” he  said.

In his June budget, Mr Constance announced a forecast $283 million deficit for 2014-15 followed by surpluses of $660 million in 2015-16, $2.1 billion in 2016-17 and $1.6 billion in 2017-18.

The  impact on the budget  of the stamp duty boost would be  clear in December.

The surge in stamp duty revenue offers hope for the government of announcing an improved 2014-15 budget position only months before the election on March 28.

The Baird government has made much of the way it has turned around the budget by cutting 15,000 public service jobs, imposing efficiency dividends on departments and capping public servant wage rises. Fiscal management is certain to be a key election platform.

The figures are also good news for the government on a weekend on which it is set to lose two seats in the Hunter region following resignations triggered by evidence at the Independent Commission Against Corruption.

Byelections for  Newcastle and Charlestown were triggered when MPs Tim Owen and Andrew Cornwell resigned  after admitting to taking thousands of dollars in illegal political donations before the 2011 election.

Labor is tipped to win Charlestown easily but faces a tougher contest in Newcastle against the Greens.

The new stamp duty figures follow this week’s “State of the States” report by CommSec which found construction of new residential housing had led NSW to be the best performing of all Australian state economies.

It is the first time NSW has been named No.1 by CommSec since it began ranking states in 2008.

This story Administrator ready to work first appeared on Nanjing Night Net.

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