The Property Council of Australia (PCA) says it is time for NSW to wind back a raft of new and higher taxes on the property sector and head down the path of broader reform.

Updated forecasts that paint a picture of wild volatility in revenue from property taxes only illustrate the case for reform, according to PCA's NSW Executive Director Glenn Byres.

"A higher band of land tax that was introduced in the 2008 mini-Budget is forecast to net an additional $200 million each year," he said.

The new ad valorem tax announced by the Government in this year's Budget is set to drag in $429 million over the next four years.

It will creep across the residential landscape as property values rise, and catch investors in the new office, retail and industrial projects that NSW needs, said Mr Byres who described these taxes as inefficient and that run counter to the need for NSW to foster a competitive investment climate.

According to him higher turnover in the property market is a good sign of improving economic health, but NSW faces its biggest challenge on the supply side.

"The rate of new housing production in Sydney alone is running at half the rate of demand identified in the Government's own Metropolitan Strategy.

"It is hoped the stamp duty concessions introduced in this year's Budget will help drive the supply of new apartments in particular.

"However, NSW needs to go further and wind back the raft of uncompetitive taxes it has introduced in recent years.

"The NSW Coalition's commitment to scrap the ad valorem tax is welcome and the

Government should rethink its position.

"Wholesale reform of property taxes - building a low, simple and efficient regime - should remain the ultimate goal."