Hi Barg - Yes, I have mistakenly only looked at one side of the issue.
The long transition from stamp duty to land tax is necessary to limit the degree of double taxation on those who paid the full whack of stamp duty. It is not something that can just be turned on or off instantly without ending up with a huge compensation bill.
The other negative aspect of stamp duty is that when the property market declines, stamp duty revenue declines and state budgets go into the red. The job shedding and cost cutting (mainly new infrastructure) that follows from the decline in stamp duty revenue exacerbates the dip in the economy and reduces the speed of recovery. Land tax on the other hand is a stable source of revenue which will ride though any peaks or troughs allowing state governments to take a longer term view of planning and infrastructure provision.
