Recent Changes to Stamp Duty Exemptions in NSW

As a result of 2017 NSW State Government Budget a number of changes have been made to stamp duty which will have a positive impact for our clients.

Insurance policies are about to become more affordable for hundreds of thousands of NSW small businesses, as the state government prepares to introduce stamp duty exemptions across certain insurance products.

According to the Insurance Council of Australia (ICA) approximately 677,000 organisations in the state will benefit from the changes. Stamp duty can add up to 9 per cent to the cost of premiums, which is a considerable expense for many businesses.

Exempt insurance includes:
• Lenders mortgage insurance taken out on or after 1 July 2017
• Crop insurance that is effected or renewed on or after 1 January 2018
• Livestock insurance that is effected or renewed on or after 1 January 2018
• Workers Compensation
• Compulsory Third Party for Motor Vehicles
• Policies of life insurance, being group superannuation investment policies, owned by the trustee of a superannuation plan for the benefit of more than one member of the plan.
• Insurance taken out on or after 1 January 2018 by small business with an annual turnover of $2 million or less will not have to pay duty on:
  • Commercial vehicle insurance for motor vehicles used primarily for business purposes;
  • Product and public liability insurance;
  • Commercial aviation insurance for an aircraft used primarily for business purposes; 
  • Occupational indemnity insurance.
Taxes on insurance are not only regressive and inefficient, they also can contribute to underinsurance and non-insurance by discouraging business owners from buying sufficient cover to suit their needs. Insurance stamp duties can add thousands of dollars to business expenses each year.