An inquiry has revealed that the biggest source of tax revenue in Victoria is not very efficient and restricts property investment. This indicates that the federal government should support Victoria’s ongoing need for replacement of the land transfer duty fees, commonly referred to as “stamp duty.” Stamp duty, which is paid by property purchasers, generates around $10.4 billion dollars of Victoria’s state tax revenue for 2021/22 financial year, but ultimately demands individual and investor decisions. It may discourage individuals from relocating for better opportunities such as a new job or moving to a property that suits their needs better. Additionally, business owners may choose not to expand or take advantage of opportunities in growth areas but rather continue with business operations as usual. The inquiry revealed that stamp duty is one of the least efficient taxes in Australia, resulting in a higher value of welfare loss to the economy for each dollar of revenue raised compared to other taxes. The key factor is to replace it with something more efficient, and it cannot be done without some support and guidance from the Commonwealth level. The Australian Capital Territory (ACT) is the only state transitioning from property transfer duties. The former Liberal New South Wales (NSW) government permitted its residents to pay stamp duty in one hit or annualised land tax. Despite this, Southern metropolitan Liberal MP David Davis expressed concern that Victorians could end up paying a stamp duty alongside whatever far-reaching replacement it is replaced with. He added that the other risk is that the government may keep both taxes. Thus, it seems that replacing the $100,000 (US$66,200) lump sum payment with something that averages a much lower amount spread over the lifespan of that property will immediately impact the budget.