Foreign buyers to cop extra property taxation: NSW state budget

Foreign buyers to cop extra property taxation: NSW state budget
Foreign buyers to cop extra property taxation: NSW state budget

Foreign property investors - individuals and corporations - in NSW will be hit with a 4 percent stamp duty surcharge when buying homes and apartments, the state budget confirmed.

Overseas investors will also cop an extra 0.75 per cent land tax surcharge on residential property.

Treasurer Gladys Berejiklian said she was confident the extra costs would not deter foreign buyers given other states had similiar measure.

NSW land tax revenues from investors are forecast to rise at a faster rate than stamp duty revenues over the next four years.

Land tax on investors will rise 8.1 percent higher revenue every year for the next four years, taking revenues from $3,136 million this year to $3,761 million in 2019-20..

The NSW Treasury suggested price growth was "moderating."

The New South Wales budget was released at midday on Tuesday, with much information pre-released. 

The State Government is not tipping any Sydney property market correction, just a likely easing.

The state budget didn't raise or lower property taxes, other than the previously canvassed new taxes on foreign investors.

 The NSW Treasurer Gladys Berejiklian's second state budget anticipates a slowing in stamp duty revenues from home sales.

They will still get $8,777 million in the next financial year, then $9,124 million in 2017-2018.

Residential transfer duties are tipped to rise at 4.4 percent annually over the next four years, "significantly more subdued than the pace see in recent years."

There was 13.6 percent growth in the current budget year, and a stunning 40 percent growth when the boom was its most robust in 2013.

The NSW State Budget officially revealed an extra $835 million extra stamp duty purchasing revenue will come from foreign buyers over the next four years.

It also expects $166 million is over the next four years from the new land tax on foreign investors.. 

NSW has not adjusted its stamp duty rates for three decades.

Transfer duty represents 29 percent of state government revenue. Land tax represents 11 percent.

The State Government revealed it is on track to deliver a record $3.4 billion surplus this financial year - and a $3.7 million in the next financial year.

Jonathan Chancellor

Jonathan Chancellor

Jonathan Chancellor is one of our authors. Jonathan has been writing about property since the early 1980s and is editor-at-large of Property Observer.

Tags: 
Property market Nsw Budget

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