Opposition Leader Barry O'Farrel told media on Friday that the coalition in New South Wales will continue to contest the government's proposed property tax.

Mr. O'Farrel said the proposed ad valorem fee on property transfers, which was quietly slipped by Lands Minister Tony Kelly on Wednesday during an Upper House meeting, was “based on a lie.”

“Ms. Keneally's new tax is not only unfair, but it's also based on a lie,” he said.

He argued the measures were also introduced a year ago.

“We fight to stop its introduction and if Labor pushes it through, we will repeal it in government.”

Mr. Kelly said the tax is not an “ad valorem fee” but an “insurance policy” against property fraud.

Premier Kristina Keneally also defended the proposed government tax saying it would apply only to 30 per cent of all property transactions.
She added the tax will put a halt on property fraud practices.
Property Council NSW acting-executive director Glenn Byres said on Wednesday he was caught off guard with the proposal.

"We have an investment climate that is poor, a 50-year low in construction levels and this hits residential and has a big impact on commercial property investment."

The burdening additional tax is set on properties between $200 and $1000, including transfer fees for properties worth $500, 000.

Commercial investors will suffer as well as they will be paying $500,000 in extra taxes on typical CBD office space.
A 0.2 per cent and 0.25 tax will be added from the existing tax on properties between $500,000 and $1 million respectively.
The new charge will be imposed in July, the same time as the increase of electricity cost.