The region's peak business organisation, Illawarra Business Chamber, believes the NSW Government's Thodey Review needs to be a part of National Cabinet discussions.
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Executive director of the Illawarra Business Chamber Adam Zarth said that Illawarra businesses were struggling because of COVID-19.
"It is essential that tax reform comes out of the too-hard basket and is addressed through the National Cabinet," he said.
"We've been advocating for tax reform from a regional perspective for a long time, particularly to have job-killing payroll tax addressed.
"While it was heartening to have the payroll tax threshold lifted in the 2018 State Budget, transformative tax reform can't happen without a high level of buy-in from the Commonwealth Government, including making sure that 'nothing is off the table'."
Mr Zarth said that local businesses have consistently told the chamber they they could incur around $10,000 a year in tax administration costs associated with payroll tax alone.
"Looking at national reform options offers a better way forward," he said.
"Some estimates suggest that the cost of stamp duty is as high as 107 cents for every dollar collected, compared to only 8 cents for more efficient taxes. This means that we are unnecessarily destroying jobs, economic opportunity and restricting the natural movement of citizens through our over-reliance on stamp duty.
"In 2016, our parent organisation - Business NSW - released the report Taking on Tax: Reforming NSW Property Taxes, which demonstrated the large economy-wide benefits associated with abolishing stamp duty in favour of a land tax.
"Since this time we have consistently been calling for a review of state taxes and we are pleased that this review has outlined sensible ways to do away with stamp duty, NSW's most harmful tax."
